Credit Union vs Banks?

http://www.cbc.ca/news/world/story/2011/11/05/bank-transfer-day.html

International "Bank Transfer Day" day happened and around 650 000 customers moved around 4.5 billion USD from major banks to credit union institutions.

So I ask, which do you think is better and why?

Credit Unions hands down. Cooperatives are not driven by profit margins and actually cares about their customers, because they are the owners anyway. They don't pull stunts like charging for debit card usage. That, and customer-owned banks like the USAA.

Going to vote for the Credit Unions as well. They've always treated me fair. Contrast this with the bank that tried to steal my house.

Am I biased? Yes. So are a lot of other Americans. One wonders if there's a good reason for it.

I've just applied for membership of a local credit union. They don't try to screw you over just to keep shareholders happy and, to be honest, I have grave doubts about the future viability of Santander (who I moved to from the Bank of Scotland just after the latter changed the conditions of my account without notice and just before they went bust) given their exposure to the Spanish property market.

Since I am like the treasurer dude of my local credit union, my opinion is biased in favour of credit unions

Credit unions are great. I remember my best friend being happy with his local one when he was younger and lived here. And the only reason I'm not using that same one is because the single branch in my area is too awkward to get to without a car.

(I guess that's the only ding I can think of... they often don't have as widespread a presence, making it potentially awkward to do anything that requires a teller or a bank-owned ATM.)

I have a debit card with 74 dollars on it with Citibank, I don't think I stand to gain much from switching to a credit union...

Don't you get fined for having less then a set amount in your account? That seems like reason enough.

Wouldn't know about that.

That's why I switched to my current bank; my other bank introduced a fee where if you had less than a certain amount in the bank you had to pay $5 each month. (And ironically the whole reason I switched to that bank is because the first bank I was with did the same thing first.)

I'm hoping that since my current bank is a locally-owned smaller regional one that's had free checking and savings at least for the past few decades, that they won't ever spring the same thing on me. Otherwise I guess it's the credit union after all, even with the branch availability inconvenience.

edited 6th Nov '11 8:27:16 AM by Jeysie

from what I can see, Citibank doesn't charge anything at all for a regular debit card.

^ Neither does Wells Fargo. (They thought of something similar to what B of A were going to do but dropped it.)

So generally, for those of you who have switched, what were the main differences in services and policy differences that you noted make you feel better for being at a credit union?

I have an account in each type- one in a credit union, and one in a bank. In general, the credit union offers me better terms for services- lower fees, better interest rates, etc. On the other hand, I get much better customer service at the commercial bank. The staff there just seem more professional.

My own reasons for switching from a bank to a credit union...

• The local credit union made far, far less mistakes. I'd spend at least ten hours a month on the phone with the commercial bank, trying to get them to correct this month's latest account SNAFU. The one time the local credit union made an error, it was fixed after fifteen minutes of talking to a teller.
• I can talk to a real human person when I have a problem, face-to-face. I don't know how other banks are but Bank of America is notorious for this. The staff at any branch basically can't help you; they call the same numbers you are given and then put you in touch with the same people. Contrast this with my credit union, where the branch employees are actually useful.
• No bullshit fees. I was getting charged left and right to do things through Bof A, whereas I've yet to see a fee from the local CU (except the one time I accidentally overdrew my account, which was my own damn fault anyway).
• Better service. The credit union employees are always friendly, polite and most of all actually helpful.
• Better hours. They call 'em "Banker's Hours" not "Credit Union Hours" for a reason...my local CU is open till 7pm, instead of 5:30 like the Bof A branches. This is important when you can't get to the branch until 5:45 to deposit your paycheck.

So yeah, Credit Unions > Commercial Banks in every measurable sense, as far as I'm concerned.

@ De Marquis

I was thinking of doing the same thing. See how my accounts at a local Credit Union fare versus my accounts at a major bank.

@ Drunk

Huh, that's actually strange. I was under the impression American banks were nicer than Canadian banks.

• I've had one mistake recently, which was instantly corrected (they charged for me something they shouldn't have). That is the first mistake in all the years I've been at major banks. I was credited back the money instantly. I just had to call the branch and fix it up in a few minutes (ie. the time it took for a person to walk over to the phone and pick it up and say I'm sorry)
• I can always talk to a real human being at my major bank and I've not seen any such issue at any of the other major banks. They usually try pretty hard to get my business. I think I've had maybe one financial advisor be annoying out of like a dozen or so I've had in the past year.
• I don't get charged fees but there's minimum balances, so that's not fun.
• I'll have to open an account with a credit union to see if customer service there is any better. I have no idea at this point. But my banks are open until 7 or 8, I kinda forget (probably 7). Also you still have to deposit pay cheques? How backwards is America? What happened to electronic banking? :P It costs more money in Canada to run a business by actually handing out pay cheques rather than just depositing money electronically.

It depends greatly on the business. Some smaller businesses or franchises may not offer direct deposit, while almost all chains and larger businesses do.

Credit union. The terms for using them are much more agreeable. You have a direct say in how the bank is run and how your money gets used. No board of share holders to kowtow to. My money is just that. My money.

As others have noted credit unions are a lot easier to deal with then the banks.

Honestly I've never been with a bank. I do have a USAA account though.

Given how you people have described credit unions versus banks, I'm not sure why the Canadian per capita rate of using credit unions is higher than that of Americans. It sounds like American banks treat their customers far worse than Canadian banks.

Breadloaf: Far fewer Americans are aware of Credit Unions, is what it boils down to. They don't have huge advertising budgets, and most have far fewer locations. The other sticking point is that some (but by no means all) CUs are sort of 'closed communities', although that's changing. By that I mean, it's a credit union for the employees of a particular company or group of companies, rather than being open to anyone who wants to join.

When I was a kid, I had accounts at two different credit unions — the one for the company my mother had been employed at before she married Dad, and the one Dad worked for. In both cases, the only reason I had an account was because I was the child of a member.

In the town I live in now, there are three — one started out as two different company-based CUs which later merged when one of the companies bought the other, and then still later opened their membership to any one living in the area. The other two, as far as I know, were open membership from the beginning.

Or college.

I haven't really been disappointed with my service from Wells Fargo (who does both credit and banking). While the banking hours is annoying, they have facilities that are open longer in grocery stores around here (and these are actually easier to get to).

I bank at First National, and the service there is great. I don't know if there's a minimum balance, but I'm not charged for having a debit card. Of course, I'm only 21 and not yet financially independent, but having worked since age 16, I can at least offer something.

Closed community sounds like the primary reason they aren't used. I think most of the Credit Unions in Canada switched to open membership application although I'm not particularly sure when that happened.

Also I noticed that the US requires Credit Unions to be not-for-profit but Canada does not have that requirement for Credit Unions.

I've never had a problem with banks, but then I've always done my business with super small community banks and the ones I've worked for were super small community banks. Granted, there's just been a merger now so it's no longer a super small community bank. We'll see how that goes...