Membership Benefits What is a Credit Union?

What is a Credit Union?

Credit unions are not-for-profit, member-owned financial institutions that exist to serve the financial needs of their member-owners. You become a member-owner the moment your account is opened at METRO!

Credit unions serve a common field of membership based on specific characteristics (like a geographical area, employee groups, or membership in an organization). METRO serves employee groups, certain organizations, and direct family members. So becoming a member is simple and easy!

Credit unions are owned by their members and governed in a democratic way by a volunteer board of directors who are also members of the credit union. METRO’s board is elected by METRO members. Board members are responsible for determining policy, services, loan rates, and dividend rates.

As a member of METRO, you’re not just another account number. You are an individual with unique financial needs, and we will keep your best interest in mind. That’s just another benefit of being a credit union: our staff will get to know you and help you achieve your goals by utilizing our many products and services. As a credit union member, you will see competitive savings rates, lower loan rates and fewer service fees.

Learn about Credit Unions at mycreditunion.gov

What is the Credit Union Difference?

New federal laws and regulations are changing the structure and face of the financial services industry. In this time of accelerating change, it is important to truly understand how credit unions are unique and different, and why we remain a necessary and extremely popular financial alternative for millions of Americans.

Not-for-profit. Credit unions are not-for-profit financial cooperatives. We exist to serve our members, not to make a profit. Unlike most other financial institutions, credit unions do not issue stock or pay dividends to outside stockholders. Instead, earnings are returned to our members in the form of lower loan rates, higher interest on deposits, and lower fees.

Taxation. Credit unions do pay taxes – payroll taxes, sales taxes, and property taxes. Congress exempts credit unions from federal income taxes. The exemption was established in 1937, affirmed by statute in 1951, and re-affirmed in 1998 in H.R. 1151, the Credit Union Membership Access Act, which states:

Credit unions, unlike many other participants in the financial services market, are exempt from Federal and most State taxes because credit unions are member-owned, democratically operated, not-for- profit organizations generally managed by volunteer boards of directors and because they have the specified mission of meeting the credit and savings needs of consumers, especially persons of modest means.”

Ownership. Credit unions are economic democracy. Each credit union member has equal ownership and one vote — regardless of how much money a member has on deposit. At a credit union, every customer is both a member and an owner.

Volunteer Boards. Each credit union is governed by a board of directors, elected by and from the credit union’s membership. Board members serve voluntarily.

Membership Eligibility. By current federal statute, credit unions cannot serve the general public. People qualify for a credit union membership through their employer, organizational affiliations like churches or social groups, or a community-chartered credit union.

Social Purpose: People Helping People. Credit unions exist to help people, not make a profit. Our goal is to serve all of our members well, including those of modest means – every member counts. Our members are fiercely loyal for this reason. They know their credit union will be there for them in bad times, as well as good. The same people-first philosophy causes credit unions and our employees to get involved in community charitable activities and worthwhile causes – just ask us.

CREDIT UNION VS. BANK