What is a federal credit union?

How can I become a credit union member?
How is a credit union founded?
Glossary of terms

A federal credit union is a cooperative, not-for-profit financial institution organized to promote thrift and provide credit to its members. Federal credit union members are provided with a safe, convenient place to save and borrow at reasonable rates, with savings insured to at least $250,000 (under a temporary increase in effect through Dec. 31, 2013) by the National Credit Union Share Insurance Fund (NCUSIF).

A federal credit union is member-owned and controlled through the election of a board of directors drawn from membership. Board members serve on a volunteer basis; one board member may be compensated.

Federal credit unions have been serving the nation's consumers for about 76 years. As of Dec. 31, 2009, there were 4,714 federal credit unions with $482.7 billion in assets and serving more than 49.6 million people.

Membership in federal credit unions is not open to the general public. Instead, it is limited to persons sharing a common bond of occupation, community or association. Examples are employees of corporations, members of associations (such as Knights of Columbus) and residents of a defined area (such as a town or a neighborhood).

To join a credit union, a potential member must be first eligible under the common bond provisions, and submit a membership application. Upon submittal of the application, and the purchase of at least one share (typically $5), a person becomes a member with full voting rights.

Many credits unions have a "once a member, always a member" policy, and most also permit members of the immediate family or household of a member to join.