Contrary to popular belief, credit unions aren’t just for unions, governments or Fortune 500 companies.
Laws do place some limits on the people credit unions may serve, but thanks to an expansion of the definitions in recent years, the financial institutions’ reach is wider today. A credit union’s charter defines its “field of membership,” which could be an employer, church, school or community as well.
Example: To help employees strengthen their financial resources, Livonia, Mich.-based Virginia Tile Co. started offering membership in USA Federal Credit Union as a new benefit. Now, nearly half of its 200 employees participate.
The appeal: Credit union memberships are free to employers yet offer employees tangible benefits such as higher interest rates on savings and better loan terms. In some cases, they also provide contemporary financial service options that many consumers associate only with large banks.
“If an employee can get a very fast response on an auto loan application when a car has to be replaced quickly,” says Virginia Tile’s HR manager, “I know that has a positive impact from a work and productivity standpoint.”
Advice: Look for a credit union that will provide internal promotions, presentations and materials that inform your employees about its membership and services. A credit union with an active promotion program makes the membership benefit truly “free” to you as an employer by not requiring large time commitments from your HR staff.
Tip: Visit the National Credit Union Association Web site at www.ncua.gov and the Credit Union National Association at www.cuna.org for directories listing credit unions by state, which is a helpful starting point. By contacting an individual credit union, you can learn more about the terms of its charter and whether it can potentially accept your employees as members.
Contact: email@example.com or (734)762-2400, extension 2410.