Credit unions are member-owned, not-for-profit financial institutions. They operate by pooling the assets of their members in order to provide loans and other financial services to those members. While credit unions offer many of the same services as banks, the two kinds of financial institutions are fundamentally different. Credit unions serve a primarily non-profit purpose and are regulated by a unique set of laws and regulatory agencies. According the Credit Union National Association (CUNA) website, more than 90 million Americans belong to credit unions.

Is the Money Invested in Credit Unions Safe During These Unstable Economic Times?

With the recent collapse of major banks and financial institutions such as Washington Mutual, AIG, and Merrill Lynch, the fall 2008 stock market decline, and the growing mortgage and foreclosure crisis, credit union members and those looking for alternatives to traditional banking are asking about the solvency of America’s credit union movement.

In a press release issued by the Credit Union National Association on September 25, 2008 and reported on by CNBC, CUNA President and CEO Dan Mica stated that funds held in credit union accounts are as safe as deposits in FDIC insured banks. This is because credit unions have their own federal deposit insurance.