U.S. News & World Report recently posted a blog article by MyBankTracker attempting to list some of the “shortcomings” of America’s credit unions.
The blogger first addresses the number of locations that credit unions operate versus banks—over 95,000 bank branches versus only over 7,000 credit union branches. The blog post fails to mention however that credit unions operate the fourth largest branch network in the world with their shared branching platform (being able to use a variety of credit union branches as if you were at your home credit union). While credit unions may operate fewer branches than the nation’s banks, their shared network of branches only falls short of Wells Fargo, Bank of America and Chase/WaMu. I would say that this makes them just as convenient as many of the country’s regional banks.
The second disadvantage: while credit unions offer more personal service, they don’t have the ability to provide as much reach as the nation’s banks. Call centers are commonplace for banks, but aren’t necessarily standard practice for credit unions. While many credit unions are utilizing outside companies to handle off-hour communications, some still operate on “bankers’ hours”. When choosing a credit union, it is important to consider the availability of member service reps, but the issue should not push to you the arms of a bank. Most credit unions have an array of technology offerings that give you account access 24 hours a day. How often are you calling a member service representative after hours with all that you can get done online today? If it is vital to you, simply choose a credit union that offers a more robust member service hours, or an off-hours call center. They are certainly out there.
Thirdly, the blog points out the technological ineptness of credit unions. An article on Bankrate.com from 2002 outlines how far ahead technologically credit unions are from banks, “leading the way” in advancements. The road to online banking and electronic tellers was paved by credit unions, banks did not adopt much of this technology until recently. The Bankrate article highlights that because credit unions can't afford the large staffs that banks can, technology becomes more important to them to create efficiencies for their members.
The final disadvantage highlighted in the article is the lack of financial advice provided by credit unions. With all the financial literacy education credit unions provide to not just members, but their communities at-large, as well as the loan counseling provided to members and the overall philosophy of “people helping people”, how could anyone claim that credit unions don’t provide enough financial advice?
These days many credit unions have on-staff certified financial counselors and those that don’t often have staff members who can provide advice and informal counsel on particular issues. Still others work with outside consultants that offer advice on insurance products, investing and more.
The article culminates with the idea that two financial institutions are better than one and that for many consumers having both a credit union and a bank account might be the “best of both worlds”. We say, join two different credit unions and enjoy better rates and lower fees.