When it comes to financial management, you are free to decide where to open accounts in the bank. The two major options are conventional banks or credit unions. While the banks are business companies that operate for the benefit of their shareholders, credit unions are cooperative societies that are owned by members. While both credit unions and banks are related to the provision of financial services, it is imperative to understand that they operate with different business models, and as such, there are differences in the way they charge their fees and interest, the technology and services they have in place. In this article, I will rank the top 10 credit unions against banks to aid your decision when choosing where to do business.
Lower Fees
The major disparity between credit unions and banks is charges. Credit unions which are not-for-profit organisations that aim at providing for the members rather than profits normally charge much lower fees than banks. It’s interesting to note that some of the best credit unions have no checking and savings accounts that come with no fees at all and no minimum balance. It is even observed that with options such as overdraft fees or charges for using an ATM, a credit union will be cheaper than a bank. This can lead to significant over time savings for the credit union members.
Higher Interest Rates
However, the most significant advantages of the best credit unions are the comparatively lower fees than most conventional banks and the possibility of receiving higher interest rates on saving accounts and or certificates of deposits. Many credit unions also have competitive rates for automobile loans and mortgages and credit cards. This enables members to retain as much of their cash as possible while at the same time earning more on their deposits. Credit unions can afford to offer better rates since they are more obsessed with giving back to members rather than making profits.
Better Customer Service
Credit unions are owned by their members and thus work towards delivering first-rate service and a more individualized experience. Research studies reveal that credit union members are more satisfied with the banking services they receive as compared to the satisfaction levels of bank customers. Some credit unions are still regional, making it easier for them to interact with members more personally. The fact that they are not-for-profit organizations means that they do not have the pressure of shareholders, and member service quality is emphasized more than sales targets that are characteristic of large-scale commercial banks.
Latest Technology
Though small community banks and credit unions have traditionally lacked technology, many of the leading national credit union organizations provide competitive and cutting-edge digital offerings that match those of giant organizations. From remarkable mobile applications to the payment systems, including Apple Pay and Google Pay, to the advanced tools for budgeting, the best credit unions incorporate the most progressive fintech. This makes banking easy and fast irrespective of whether one has a branch in his or her locality or not. Credit unions also do not suffer from burdensome legacy technology challenges that hinder innovation in some large banks.
Convenience and Accessibility
For example, the number of outlets is always a problem in a credit union and has been confined to a few branches compared to the large network of banks or other credit-union bank institutions across the country or region. However, compared to this disadvantage, the ability of members to access 30,000+ shared credit union branches through cooperative networks, together with the advanced digital banking technologies have reduced this problem. In addition to shared branches, credit union consumers have an array of fee-free ATM locations to make face-to-face transactions in addition to online and mobile banking. This means the geographic constraints have been eliminated as a factor affecting the top credit unions members.
CU Locating Rankings: Top 10
Taking into account criteria like fees, rates, service, technology and accessibility, here are 10 top-rated credit unions when comparing the pros and cons of banks vs credit unions:Taking into account criteria like fees, rates, service, technology and accessibility, here are 10 top-rated credit unions when comparing the pros and cons of banks vs credit unions:
1. PenFed Credit Union
As a credit union with more than 2. 3 million members across the world, PenFed Credit Union provides competitive high-interest checking and saving accounts and some of the lowest auto loan and mortgage rates. Digital banking and low-fee banking are two features that make PenFed attractive.
2. Alliant Credit Union
Alliant Credit Union is based in Chicago and offers checking and savings accounts with no monthly fees or minimum balance. They have some of the highest interest rates on savings in the country and have a large customer base.
3. Pentagon Federal Credit Union
Pentagon Federal Credit Union, PenFed’s sister organization, delivers the best car loan rates as well as low-fee checking accounts available via a strong online banking system.
4. Digital Federal Credit Union
Being one of the biggest credit unions in the United States of America with more than 9 million members, DCU or Digital Federal Credit Union, uses affiliations with banks to provide one of the biggest networks of free ATMs together with strong interest rates on savings.
5. State Employees’ Credit Union
State Employees’ Credit Union, North Carolina’s second largest based in Raleigh, offers reasonable loan rates and an extensive branch network with digital banking, including Apple Pay.
6. Golden 1 Credit Union
Mainly operating in California, Golden 1 Credit Union offers advanced mobile banking services and the largest number of branches among CU with many of them being opened on Sundays to ensure the ultimate convenience.
7. America First Credit Union
Of the 25 firms under analysis, one of the Utah-based America First Credit Union stands out for its ability to post competitive rates for auto loans and mortgages. Functionality of mobile and online banking is at the level of technology of the leading national banks.
8. Suncoast Credit Union
Having the most branches in Florida, Suncoast Credit Union provides extensive face-to-face services in the state and has the most self-service points in the form of ATMs among Florida-based competitors. Suncoast has very competitive mortgage loans, low auto loan interest rates and high dividends on savings.
9. SchoolsFirst Federal Credit Union
SchoolsFirst Federal Credit Union is among the five biggest credit unions across the United States of America, offering excellent mobile and digital banking solutions, as well as numerous branches across California. It offers membership with reasonable fees and good saving rates.
10. Boeing Employee Credit Union
Despite the fact that it is more difficult to become a member of the Boeing Employee Credit Union compared to some other credit unions, the interest rates on the loans and deposit accounts are very competitive, and the member service is designed with a focus on the financial health of its members. The digital banking services provided are almost on par with those of standard banking institutions.
Evaluate Your Individual Needs
If you are trying to decide where to put your personal finance, there is no clear difference between banks and credit unions. Every person has to compare things such as account charges, interest for saving and loaning, technology requirements, and accessibility issues. However, credit unions do offer comparable products at reasonable costs, and more importantly, they focus on member satisfaction rather than bank gains in some instances. It is thus possible to get affordable convenience by accessing the offerings of the best national and regional credit unions.
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