On the surface, credit unions and other financial institutions look very similar, offering deposits in the form of savings accounts, certificates of deposit, and checking accounts. They lend money in the form of mortgages, home equity loans, auto loans, and credit cards. They also provide electronic banking and many of the services that facilitate the savings, transfer, and lending of money.

But a deeper look reveals profound differences that influence rates and services provided.

Credit unions promote the financial well-being of members, including those of modest means, through a system that is cooperative, member-owned, volunteer-directed and not-for-profit.

Credit unions are voluntary, cooperative organizations, offering services to people willing to accept the responsibilities and benefits of membership, without gender, social, racial, political or religious discrimination. Many cooperatives, such as credit unions, operate as not-for-profit institutions with volunteer board of directors. In the case of credit unions, members are drawn from defined fields of membership or common bonds.

Cooperatives are democratic organizations owned and controlled by their members, one member one vote, with equal opportunity for participation in setting policies and making decisions.

Members are the owners of the credit union and contribute to, and democratically control, the capital of the cooperative. For credit unions, which typically offer better rates, fees and service than for-profit financial institutions, members recognize benefits in proportion to the extent of their financial transactions and general usage.

Credit unions are autonomous, self-help organizations controlled by their members. If the cooperative enters into agreements with other organizations or raises capital from external sources, it is done so based on terms that ensure democratic control by the members and maintains the cooperative’s autonomy.

Credit unions provide education and training for members, elected representatives, managers and employees so they can contribute effectively to the development of the cooperative.

Credit unions place particular importance on educational opportunities for their volunteer directors, and financial education for their members and the public, especially the nation’s youth. Credit unions also recognize the importance of ensuring the general public and policy makers are informed about the nature, structure and benefits of cooperatives.

Credit unions serve their members most effectively and strengthen the cooperative movement by working together through local, state, regional, national, and international structures.

While focusing on member needs, credit unions work for the sustainable development of communities, including people of modest means, through policies developed and accepted by the members.