The Credit Union Difference What's the difference between a credit union and a bank? The Credit Union Difference What's the difference between a credit union and a bank? Credit Union   Bank Member owned   Stockholders Volunteer board of directors   Paid board of directors Members   customers Not for profit   for profit Dividends paid to members   dividends paid to stockholders Each member gets one vote   Stockholders vote by shares owned People who belong to a credit union usually have something in common, such as their place of work or where they live. When you open an account in a credit union, you become a member of it. That means you are more than just a customer! Your savings are called shares and they represent your ownership in the credit union. The credit union keeps your money safe. Not only do we have fireproof locked vaults we have insurance from an agency of the federal government, called the National Credit Union Administration (NCUA). We also purchased additional insurance through American Share Insurance -- so your account is insured up to $350,000. No matter what, we won't lose your money! Besides that we don't keep all the money at the credit union, that would take up way too much space. You also make money by having your money in the credit union. You receive money from the credit union in the form of dividends. Why can we pay interest?? People take out loans from the credit union to help them buy expensive things they could not afford otherwise, like a car or house. A loan is a sum of money lent for a certain amount of time. It will have to be paid back to the credit union along with a fee, known as interest. The credit union can use the money you save to make these loans. The interest we receive from the loans lets us pay you for saving your money. The money you receive from saving your money is called a dividend.