What’s a Credit Union?
A credit union by definition a not-for-profit banking organization designed to provide financial services and loans to its members. These organizations by their nature are member-owned, with even the directors of the board being voted on by credit union members. This board, elected by and steered in essence by members, sets policies such as dividend and loan rates. That’s one of the reasons credit unions are considered to be one of the safest institutions to do business with. It’s owned by its members and it’s not for profit, meaning it will offer reasonable rates for the benefit of the members/owners, not for the bottom line.
If you’re not in the business of profit, what’s the goal?
Many credit unions were established nearly a century ago by various communities, oftentimes by groups of employees of a company. In KEMBA’s case, it was the Kroger Employees Mutual Benefits Association. You could almost look at us as a pooling of resources in a local banking institution as opposed to larger national organizations that don’t necessarily benefit the community. Because membership was exclusive to a specific group, only people within that group were able to obtain loans from us, as it still is today. That’s also why there is a latent incentive to have policies that are in the interest of the members and investors, like keeping rates low and dividends high.
Are my deposits at KEMBA insured?
Yes. Each account is insured up to $250,000 by American Share Insurance, the nation’s largest private deposit insurer.
Whose bright idea was the credit union?
The earliest credit unions trace their roots back to more than 100 years ago. In this country, the first one was the St. Mary’s Cooperative Credit Association, which was in essence a church-run credit union.
If you’re a KEMBA member, you’re in good company. It’s estimated that one in three Americans is a member of a credit union.