Home > Uncategorized > It’s Not That Obvious

It’s Not That Obvious

I came across this post on the SC Federal “Simple Cents” blog the other day.  In the article, they were giving reasons for why a business customer should pick their credit union over a big bank in the area.  Now, I’m a fan of credit unions, well…people at credit unions.  But the reasons they gave just didn’t sit well with me.  Here’s the list, along with my comments:

Member owned – sense of ownership – one share one vote!
We have the same.  You too can purchase a share of stock and get one vote for each owned share.

Shareholders, not stockholders – bank’s charge fees to pay their stockholders!
From Dictionary.com
shareholder – Any person, company, or other institution that owns at least 1 share in a company. A shareholder may also be referred to as a stockholder.
And actually, we charge fees to make a profit.  We also charge interest on our loans.  Last I checked, credit unions charge fees and interest also. But no profit, no dividend (payment to stockholders).

Our Board of Directors are unpaid volunteers – they volunteer because they believe in the credit union movement!
Our Board of Directors are paid.  They are also stockholders in the bank.  Basically, they put their money where their mouth is.

Personalized service – you’re not just a number!
Hey, we know your name also.  We also know all of your family and wave and speak to you when we see you outside the bank.

Local decisions – your account or loan applications don’t go to a headquarters somewhere across the nation!
Since we have branches along the coast, the farthest branch is 4 hours away. But loan/account decisions are made in each market.

Call our contact center or visit a branch as many times as you want – some banks charge after a certain amount of visits/calls for service you deserve anyway!
Ok, the only bank that I know that did this was Wachovia, which is now Wells Fargo, which doesn’t charge for teller transactions.  (If I’m wrong, someone please point me to the correct fee schedule)

Typically lower fees, lower loan rates, and higher dividend rates!
Glad they said typically, their fee schedule would make Bank of America blush.  Yeah, some rates are lower, especially for cars. As for dividends, I don’t know how that works at a credit union.

Convenience – ATMs, Online Banking, CURewards points, Financial Education seminars, and the list goes on!
Yep, we have all that also.  You can even earn cash back with our Dollars4Debits promotion.  We also have remote deposit capture for businesses and balance/transactions alerts in mobile banking.

Honestly, if this is how credit unions sell themselves as being better than banks (especially community banks), it’s no wonder people aren’t beating down their doors.  A credit union can’t “out bank” a bank.  If I were the business owner, I’d be thinking “so, what’s the difference?”  I know that there are better reasons to join a credit union.  These just aren’t them.

Photo by Laurel714

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  1. April 7, 2010 at 4:18 pm

    George: Great points here. It isn’t just this credit union, or even credit unions in general, that are guilty of this. It’s an example of marketing what’s important to the institution, and not what’s important to the customer.

  2. April 7, 2010 at 8:03 pm

    Yep, not that obvious. I had previously read the SimpleCents post as well, thinking about which of these subtleties may be persuasive to a prospective member. Really not that obvious.

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