Did you know more than 112 million Americans use credit unions? While credit unions continue to gain popularity, persistent myths prevent some people from making the switch. Here’s a look at the seven most common misconceptions and the answers that debunk them.
Myth: Credit Unions Have Limited Membership Eligibility
Many people mistakenly believe that strict membership requirements will prevent them from joining a credit union, so they don’t even try. The fact is, you’re probably eligible to join more credit unions than you think.
Some credit unions, including Connexus, have members all across the country. For example, if you don’t meet the workplace, community, or family requirements, you can join Connexus by becoming a member of the Connexus Association, which requires a one-time $5 donation1.
Myth: Credit Unions are Only Good for Local Banking
While it’s true that most credit unions are based locally, it doesn’t mean you can’t access your accounts while on the road.
There are two easy ways to access your money with a credit union:
Online Banking: Many credit unions offer 24/7 online banking access from anywhere in the world. And as you’ll see below, Connexus Digital Banking is one of the best available.
Shared Branching: If your credit union is a part of a shared branch network, that means you can walk into the branch of any other in-network credit union and make certain transactions.
Let’s say you typically bank at the Connexus branch in New Hampshire, but you’re traveling with your family in Texas. If you forgot to make a loan payment, you could find an in-network credit union in Texas, walk into their branch and make your loan payment like you would at Connexus in New Hampshire.
Credit unions are about working together, not competing against each other. You won’t find a service like that at a bank. See more information on Shared Branching.
Myth: Credit Unions Aren’t as High-Tech as Banks
It’s a common misconception that banks are more innovative than credit unions. This couldn’t be further from the truth! In fact, the Connexus App is rated 4.7 on the Apple App Store and 4.5 on Google Play, placing it among the highest rated banking apps available today.
In addition, we offer the same (or more!) online features as many national banks, including:
Myth: Credit Unions are Small and Can’t Offer as Much
In terms of asset size, yes — corporate banks are bigger than even the largest credit unions. But bigger doesn’t mean better. After all, both banks and credit unions federally insure your money up to $250,000. Credit unions also have the same security standards as banks.
As far as product and service offerings go, some large corporate banks may have specialty services that are unavailable elsewhere, but today’s credit unions offer all the same popular services that banks provide. This includes checking and savings accounts, credit cards, loans, mortgages, online banking, investment services, ATM cards, and more.
Myth: Credit Unions Aren’t as Regulated as Banks
Actually, the opposite is true! Credit unions are actually regulated based on the same standards as conventional banks.
Myth: Credit Unions Don’t Offer Rewards Programs
Many banks win over customers by offering airline miles, cash-back rewards, hotel discounts, and other perks. The problem is that many of those banks require you to pay a fee to join their rewards programs. As it turns out, the better loan rates, higher yields on deposit accounts, and lower fees usually make banking with a credit union more advantageous.
Myth: Credit Unions Don’t Pay Taxes
While it’s true that their not-for-profit status allows credit unions to be exempt from paying federal corporate income taxes, they still pay local, property, and employer taxes. Then, the money they save from not paying income taxes goes right back into the organization, which is why credit unions can offer fewer fees, lower rates, and higher yields. Credit unions also use that money to give back to local charities.
Now that you know the truth about credit unions, you might be interested in joining one. If you still have questions, or you’re ready to change the way you bank, we’re here for you.