Credit unions were built with the philosophy of people helping people. For that and several other reasons, taking your business banking to a credit union instead of a commercial bank might be the best financial decision you could make.
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A credit union has a significant edge over big banks when it comes to both personal and business banking. Since their inception in Germany in the 1850s, credit unions have embraced a business model of serving the working class. As more credit unions emerged during the turn of the century, they became known for their cooperative identity — based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity.
By the time the credit union model spread to North America in the early 1900s, those values had gained popularity among working people on both sides of the Atlantic. US families in need of an inexpensive source of credit to buy household appliances and automobiles embraced the credit union in the 1920s, while commercial banks remained hesitant to offer these types of consumer loans.
Today, the credit union model has not only grown, but continues to expand internationally. According to the 2021 World Council of Credit Unions', there are over 87,000 credit unions in 118 countries serving 393 million members. Members consistently trust their money with credit unions because of the same core ideals on which they were founded.
All of this is great news for your business banking needs. Why? Here are five reasons:
1. Low rates, few fees. Credit unions are not-for-profit financial cooperatives. They don't make money off extraneous fees and high rates on loans and credit to pay shareholders. Instead, having this flexibility allows them to return money back to their members in the form of low loan rates, high deposit interest rates and low fees for both personal and business accounts.
2. Community advocates. Being entrenched in the local community allows credit unions to see your small business through likeminded eyes. Commercial banks often don't have that perspective. For a small business member at a credit union, that's a big plus.
3. Going digital. More and more credit unions (including BECU) have embraced digital banking. Big banks relying on brick-and-mortar branches still carry a lot of overhead, which often results in account fees and high rates to make up for the operating costs. Having low overhead with a remote banking model is part of how credit unions keep fees minimal and rates competitively low.
4. Top-notch support. Going digital is great, but it's the personal touch that makes technology complete. Whether it's a product that could save you a few steps during a transaction or personalized advice for the direction of your business, credit unions have the resources as well as products and services to help.
5. A tilting market. According to the most recent data from the National Credit Union Administration, total U.S. credit union loans grew to $1.50 trillion in 2022. Also worth noting is an increase in total membership to 135.3 million during that stretch. Both gains are evidence that the credit union trend is picking up steam and shows no signs of slowing down. As more members make the switch, more businesses are being funded by low-rate loans from their friendly neighborhood credit union.
With no shareholders to appease or a bottom line to prioritize, credit unions put people first. This puts credit unions in a unique position to offer the best advice, products, and solutions to personal and business banking members without focusing on making a profit.