Definition

Noun: A credit union is a member-owned financial cooperative that provides traditional banking services. Unlike commercial banks, credit unions are not-for-profit organizations created and operated by their members. Profits are returned to members in the form of lower fees, better interest rates on savings, and lower interest rates on loans.

Usage

Credit unions are formed by groups of people with a "common bond," such as working for the same employer, belonging to the same church, or living in the same community. Members pool their money (savings) to provide loans and other financial services to each other.

Examples

• Noun:
  • I got a car loan from my local credit union at a much lower rate than the bank offered.
  • Members of the teachers' credit union can access their accounts online.
  • The primary goal of a credit union is to serve its members, not to maximize profits.

Advanced Usage

• "to be a member of a credit union": to have an account and ownership in one.
  • She has been a member of the federal credit union for twenty years.
• "credit union membership": the state of being a member, or the collective body of members.
  • Credit union membership is restricted to employees of the company and their families.

Variants and Related Words

• Financial Cooperative (n): Another term for a credit union, emphasizing its cooperative structure.
  • A financial cooperative operates on the principle of people helping people.
• Member-Owned Institution (n): A descriptive phrase highlighting that the users own the credit union.
  • As a member-owned institution, our priorities are different from a large bank.

Synonyms

• Cooperative Bank (n): A similar member-focused financial institution.
• Savings and Loan Association (S&L) (n): A type of financial institution that also focuses on savings and home loans, though structurally different.

Related Phrases

• Share Account (n): The term commonly used for a savings account at a credit union, as members purchase "shares."
  • Your initial deposit purchases a share account, making you an owner.
• Common Bond (n): The shared characteristic that defines eligibility for membership.
  • The common bond for this credit union is residence within the county.

Noun

1. a cooperative depository financial institution whose members can obtain loans from their combined savings