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The Credit Union Difference

Credit Unions Vs. Banks

You’ve probably heard it before from family and friends, or even from Clark Howard – “You should join a credit union!” But why? What’s the difference between a credit union and a bank, and why should you choose one over the other? Hopefully the information below will answer those questions and more.

Philosophy

Credit Union

A not-for-profit financial cooperative aimed at promoting thrift, savings and sound credit use to improve the lives of its member-owners.

Bank

A for-profit financial institution aimed at maximizing profits for stockholders.


Account Holders

Credit Union

Every member of the credit union is an equal owner, not just a customer.

Bank

Banks have customers. Only stockholders are considered owners of a bank, and they are not required to have an open account at the bank they invest in.


Leadership

Credit Union

Credit unions have a Board of Directors who are elected by the credit union’s members.

Bank

A bank’s Board of Directors is elected by stockholders. They are legally bound to make decisions that benefit stockholders, not the bank’s customers.


Mission

Credit Union

Credit union profits, in excess of expenses, are returned to members in the form of lower loan rates, higher savings rates and lower fees.

Bank

Banks maximize profits for stockholders, often offering little to no return to customers for their investment.


Taxation

Credit Union

Credit unions are exempt from corporate income tax since they are not-for-profit cooperatives that return profits to their members.

Bank

Banks are taxed because they are designated as for-profit corporations who only return profits to their stockholders.


Credit Union Cooperative Principles

  • Democratic Control: One Member, one vote.
  • Open Membership: Membership fosters community.
  • Non-discrimination: All are welcome at a credit union.
  • Service to Members: Credit Union services are intended to improve the economic and social well-being of members.
  • Distribution to Members: Profits are returned to members not shareholders.
  • Building Financial Stability: Credit Unions are reliable and build their reserves to ensure continued service to members.
  • Cooperation Among Cooperatives: Credit Unions cooperate with each other to best serve the interest of their members and communities.
  • Social Responsibility: Credit Unions seek to bring about human and social development. 1/3 of American credit unions are designated low-income.
  • Ongoing Education: Credit Unions provide financial literacy education.

Corporate Office

1505 Lakes Parkway, Suite 100
Lawrenceville, GA 30043
No branch onsite.

Routing Number: 261174759

Copyright © 2019 Peach State Federal Credit Union
All Rights Reserved. This credit union is federally insured by the National Credit Union Administration.
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