As of 2021, as many as 6,293 credit unions are operational in the US. The annualized business growth of these financial institutions has been at a CAGR of 2.7% from 2016 to 2021. This was possible because more and more people joined these establishments. In fact, the number of credit union members in the US rose from 98.4 million in 2013 to 126.6 million by 2020.
Credit union members come from all walks of life, including business owners, since these financial institutions offer a wide range of advanced banking services for all sizes of businesses. Here are the top facilities offered by a credit union that makes it ideal for a business account.
All-Round Business Services
Did you think that a credit union could not offer as many services as a traditional bank? Well, that isn’t true. From business checking accounts to commercial lending, credit unions offer a complete set of business facilities. Moreover, you can smoothly manage your banking and even track the inflow and outflow of funds for your business with ease. All these facilities are available, regardless of whether your business is a budding startup or a well-established company.
Perks of Membership
A bank needs to share profits with its shareholders in the form of dividends. But a credit union shares its profits with you as a customer and a member of this financial establishment. This means that if you join a credit union, you can expect to get higher rates on your business checking, money market and other accounts. In addition, since such a financial institution usually offers loans at low interest rates, loan repayment does not become a burden.
Lower Fees
The fee structure makes all the difference when you compare a credit union to a bank. Banks usually levy charges based on each item. So, they may charge a fee every time they process a different item. Also, the permitted number of free transactions often differ according to the kind of account you hold in the bank. On the other hand, a credit union lets you carry out various transactions with levying separate charges for every item. This is applicable until you exhaust the transaction limit on your account. Such savings can be highly beneficial in preserving cash flow.
Local Support
A small business works towards the welfare of its local community, providing jobs. Similarly, a credit union works to benefit the community with diverse offerings, such as small business loans, scholarships, donations, and sponsorships.
Another advantage of working with a credit union is the low risk of loan denial, since decisions to grant loans are taken locally. Also, the eligibility criteria tend to be less stringent than those of traditional banks.
Accessibility
A common misconception is that a credit union does not offer easy and fast online banking. However, in reality, it embraces advanced technology to provide a great banking experience. So, you can gain access to the entire gamut of online and mobile-friendly banking services, such as account activities, direct deposits, bill payments and fund transfers.
For start-ups and SMEs, credit unions could prove to be a better financial services provider than traditional banks, since they are focused on fulfilling specific business needs.
