It’s official: 100 million Americans are credit union members. That’s more than AARP, AAA and the AFL-CIO combined. And while credit unions exist in over 100 countries around the world, there’s definitely an American flavor to financial institutions democratically run for member benefits rather than shareholder profits.
So why are 100 million Americans — nearly half of all economically active adults — using credit unions instead of traditional, for-profit banks? The increased activity goes beyond mere membership numbers: Credit unions’ share of the mortgage market rose from 3 to 10 percent in a single year, and business lending is up a whopping 21 percent.
This increase is at least partially attributable to the fact that credit unions generally put fewer hurdles in front of consumers. Navy Federal Credit Union, with a membership of over 4.5 million, offers interest-only loans to members, which most lenders have abandoned. Members at credit unions generally find lower closing costs than customers at banks, as well as lower interest rates on most kinds of loans. Likewise, overdraft fees are lower.
Some areas where credit unions offer more? Members can typically access broader ATM networks like the CO-OP network, which has almost 30,000 ATMs, because credit unions have banded together to share branch locations and other resources. What’s more, 80 percent of credit unions offer free checking, compared to 50 percent of banks.
This all means extra money saved and extra time gained, indispensable resources that over 100 million people are using to their advantage. Whether you’re building a college fund for your kids like Raymond Shuck or traveling the world like Ashley Mengwasser, America’s credit unions are there to help you turn dreams into reality.
Editor’s Note: This post previously published on October 26, 2014.