not-for-profit financial institution typically formed by employees of a company, a labor union, or a religious group and operated as a cooperative. Credit unions may offer a full range of financial services and pay higher rates on deposits and charge lower rates on loans than commercial banks. Federally chartered credit unions are regulated and insured by the National Credit Union Administration.

not-for-profit financial cooperative that makes personal loans and offers other consumer banking services to persons sharing a common bond, typically employment at the same firm. Deregulation in the banking industry since the late 1970s has allowed credit unions to offer many of the same banking services as commercial banks, savings banks, and savings and loan associations. Federally chartered credit unions can write residential mortgages and issue credit cards. Many credit unions also offer interest-bearing transaction accounts (called a share draft account ). Credit unions can charge below-market rates on loans while paying higher rates to savers, as they are exempt from federal and state taxes. The Credit Union Membership Access Act of 1998 permits credit unions to expand their potential membership by soliciting members from more than one occupational group, as long as each member group is limited to 3,000 individuals. Credit unions get their operating funds from shares purchased by individual owners, who are called members, and pay dividends (representing the payment of interest) out of earnings.

The National Credit Union Administration (NCUA) , an independent federal agency chartered in 1970, is the primary regulator of national (federally chartered) credit unions. It also operates the National Credit Union Share Insurance Fund, which offers share deposit insurance up to $100,000 per account for qualifying federal and state credit unions, and the Central Liquidity Facility (CLF) , a lender-of-last resort for credit unions.

not-for-profit financial institution, typically formed by employees of a company, a labor union, or a religious group and operated as a cooperative. Credit unions may offer a full range of financial services and may pay higher rates on deposits and charge lower rates on loans than commercial banks. Credit unions are regulated by the Federal Credit Union Administration.