You may be better off banking with a credit union. Here's why.
The retail banking industry in Australia is dominated by the ‘big four’ — Westpac, Commonwealth Bank, ANZ and National Australia Bank — and a host of other banks. Australian banks offer a huge range of financial products and services to help you manage all of your banking needs.
But regardless of whether you’re looking to open a transaction account, a savings account or any other type of bank account, you don’t necessarily need to open it with a bank. Australia’s credit unions offer all the same products that you would find from your bank, including savings and transaction accounts, and in many cases they may even help you find a better deal.
Compare credit union bank accounts in the table below
What is a credit union?
A credit union is an authorised deposit-taking institution. They are regulated the same as banks. Although they offer many of the same products as banks, credit unions are actually structured in quite a different way. Whereas banks are run with the aim of generating profits for shareholders, credit unions are set up to focus on their members, who are also their customers. Each credit union customer owns a share in the organisation they belong to, and each has a vote in how the credit union is managed or governed.
While banks pass any profits on to their external shareholders, a credit union’s profits are put back into the products and services they offer. This means that members can enjoy their share of profits through better customer service, lower home loan interest rates, fewer fees and better banking products.
There are more than 65 credit unions in Australia, many of which consistently outperform the major banks in customer satisfaction surveys. According to the Customer Owned Banking Association, Australia’s credit unions, building societies and mutual banks serve more than four million customers and hold $97 billion in assets. Collectively, they are the fifth largest holders of deposits in Australia.
What are the benefits of credit union bank accounts?
It's run to benefit members
- Credit unions are focused on delivering the best products and services to its customers, not on generating profits for shareholders. The profits are returned to it's members, who are usually the account holders.
- Since credit unions are smaller and more community-based than banks, credit unions can focus on offering personalised customer service and financial advice.
Generally offer more competitive products
- Credit unions aim to pass profits on to their customers in the form of improved products, fewer fees, better interest rates and superior customer service.
You get a say
- When you’re a credit union customer, you become a member of that organisation and get a say in how the credit union is governed.
It's properly regulated
- All Australian credit unions, mutual building societies and mutual banks are Authorised Deposit-taking Institutions (ADIs) that are regulated by the Australian Securities and Investment Commission and the Australian Prudential Regulation Authority.
It's covered by the Government guarantee
- Deposits of up to $250,000 with Australian credit unions are guaranteed by the Federal Government.
How do I compare credit union bank accounts?
Make sure you keep the following features in mind when weighing up the pros and cons of different credit union bank accounts:
Little to no account keeping fees
It’s always essential to check what fees and charges apply to your account. These include ongoing account-keeping fees, annual fees, transaction fees, ATM withdrawal fees and foreign transaction fees. Read the fine print closely to familiarise yourself with all penalties that may apply.
Compare the options you have for accessing your funds: can you manage your money online, via your mobile, over the phone and/or by popping into a branch? If you ever need fast access to your funds in an emergency, can you withdraw money from your account without incurring any fees? If you regularly use ATMs, how large is the credit union’s ATM network?
The credit union’s internet and mobile banking portals
In the modern world, more and more of our everyday banking transactions are carried out online or via your smartphone. With this in mind, read reviews and testimonials to find out how easy to use the credit union’s internet banking portal is, and whether its mobile banking app also has a reputation for being user-friendly.
Credit union bank accounts offer all the features you’d expect from an ordinary bank account but often with fewer fees and better features. Compare credit union bank accounts at finder.com.au today to find the ideal account for your banking needs.