Frequently Asked Questions
Q. We hear a lot about banks these days but what about credit unions? Are credit unions growing in size and importance?
A. Very much so. Membership and assets are increasing steadily. Let's look at KCCU as an example.
Since the current CEO Jon Dessau began working for KCCU in 2000, the local credit union had approximately $40 Million in assets with 7,700 members and reserves of $2.5 Million and 27 employees. We are now approaching 10,000 members with capital and reserves of over $16.9 million and assets under administration of over $270 million employing over 42 people in the local community.
As of the CCUA 2021-22 Report, and the CCUA National System Results Q2 2022, nationally, there are over 10 million Canadians who have more than $540 billion invested in 424 Credit Unions and Caisses Populaires across Canada, with 2,219 locations in over 400 communities. In Ontario alone, there are 60 credit unions serving 1.6 million members, employing over 6,000 people, and holding over $87 billion in assets.
Q. Banks also emphasize personal service in national advertising campaigns. When it comes to service, what is the difference between the Credit Union and the Bank?
A. The people to whom we provide service -- our members -- are our owners.
Working for the Credit Union, we work directly for the people who own the business. We are in business to provide a fair and equitable return to all of our members. A very personal bond is established. Our personal service goes beyond that of other financial institutions. We sit down with people and show them how to manage their budgets. Here is an illustration of the differences between credit unions and banks.
Often, we work in a personal way to help people get out of debt. When we talk about loans, we don't employ any impersonal point system. To us, the character of the individual is more important than judging a person by the number of points scored on a test.
Banks exist strictly to maximize profits for a few shareholders. We exist to provide service and a fair return to all our members; they are our owners. We operate using the seven co-operative principles.
Q. Are there any more differences between credit unions and other financial institutions -- when it comes to service?
A. The biggest difference is that while everybody talks about personal service, we actually provide it. For instance, our staff is stable with very little turnover, year-to-year. We have a staff who really care about the people they serve.
Our members and staff likely know one another on a first-name basis. If a member loses a job, he or she knows that advice and friendship are available. Staff can help the member budget and help determine the best method to invest.
Beyond being good listeners, our staff are professionals and are constantly taking courses to renew their knowledge of financial services.
Q. Speaking about financial services, does the Credit Union offer a wide range?
A. We provide access to all the services that a person expects from a financial institution.
All of the typical services are available -- such as Chequing and Saving Accounts, Term Deposits/GICs, Mutual funds*, Stocks*, Bonds*, ETFs*, Loans, RRSPs, RRIFs, TFSAs, Mortgages, Lines of Credit, Automated Teller Machines (ATMs), MemberCard® debit cards, Interac®, and Mastercard.
Credit unions have been innovators in the services offered. Because members wanted mortgage arrangements that best suited them, we developed weekly and bi-weekly payment options.
Many are surprised at the diverse range of services we offer -- from financial advice to budget counseling and planning, from credit insurance products to low-rate financing for dealers' customers, for home repairs, renovations, automobiles, boats and just about anything that might require financing. We are a one-stop financial service center. We offer consumer (member) advocacy and education. An example of this is "It's a Money Thing". This is a series of videos and graphics which explain as in this example, the differences between credit unions and banks. Other topics include understanding how to improve your credit score, budgeting basics, the power of compound interest, identity theft, co-operative principles, comparing payment cards, and more.
Q. What is the appeal of Credit Unions that have led to this increase in membership and assets?
A. Most people see us as a full-service banking alternative.
We are no longer just the place to borrow fifty dollars until payday. People have discovered that we can provide the financial services that they need. For our members, we are their primary financial institution.
Many people do business with us because they see us, the Credit Union, as compatible with their way of thinking. For instance, they appreciate that their dollars stay in the community and that our investments are always ethical.
People like the personal nature of the credit union. They like the fact that we treat our members and staff with the respect they deserve. People deal with us because we are not tied to some head office who are detached from the day-to-day operation. If they want to talk to the top, the top is right here and always accessible.
In addition to local, personal appeal we are able, through international connections with MasterCard, Interac®, Plus, and many others to provide our members access to financial facilities around the world. Credit unions' focus on their members has been recognized by Ipsos who ranked credit unions as #1 in service and in online banking for the past eighteen consecutive years.
Q. How can I find extra money to put away for my kids' education?
A. We encourage you to go over your financial situation with one of our financial advisers.
If you owe money on credit cards, it's good to consolidate and not only save money with a lower interest rate but also improve your cash flow which you can then place in an RESP.
Q. How can I save money with weekly or bi-weekly payments?
A. Because you pay more often, you pay the principal down faster. Because the principal is paid down faster, you pay less interest.
Q. What is the Credit Union Rates for LOANS, MORTGAGES, and INVESTMENTS (RRSPs and GICs)?
A. In most cases, we will match or beat the rates available at the big banks for all mortgages, loans, and investments at your Credit Union. Please give us a call and see what a difference it can make dealing with your local community credit union.
**Mutual funds are offered through Credential Asset Management Inc. Mutual funds and other securities are offered through Credential Securities, a division of Credential QTrade Securities Inc. Commissions, trailing commissions, management fees and expenses may all be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual funds and other securities are not guaranteed, their values change frequently and past performance may not be repeated. Credential and Credential Securities are registered marks owned by Aviso Wealth Inc.