The Federal Credit Union Act describes the basic structure governing federal credit unions.
Generally, credit unions have the following key characteristics:
- Membership is limited to a group, or multiple groups, each defined in the credit union’s charter, each of which has a common bond of occupation or association, or is located within a well-defined local community, neighborhood or rural district.
- Member deposits into the credit union — otherwise known as shares — allow the members to become owners of the credit union with a right to run for election to become a credit union official, as well as vote for the credit union’s officials and certain other credit union matters.
- Members exercise democratic control: one member, one vote, regardless of shares owned.
- Shares provide primary funding for the lending and investment activities of the credit union.
- The credit union is governed by a board of directors elected by and from the credit union’s membership. Board and other committee members serve on a volunteer basis and are charged with acting in the best interests of all members.
Source: ncua.gov
This item was originally featured in the SAG-AFTRA summer 2023 magazine.