Minnesota Credit Unions provide $117 million in direct financial benefits to the state in 2017
Friday, March 16, 2018
ST. PAUL, Minn. (March 16, 2018) - In 2017, Minnesotans received over $117 million in direct financial benefits by being members of credit unions. Per their unique business model, credit unions are required to return earnings back to members. They do so with higher interest rates on savings accounts, lower interest rates on loans and lower fees. Over 1.7 million Minnesotans who belong to a credit union realize an average annual benefit of $69 as individuals or $132 per household.
Minnesota Credit Unions have a $2.6 billion impact on Minnesota’s economy and are trusted with $22.3 billion in assets from Minnesota families and business. This includes:
- Over $94 million in lower interest in loans
- Over $13 million in lower or non-existent fees
- Over $8 million in higher interest rates on savings products
- Over $1.8 billion in loans to small businesses
Credit unions are financial cooperatives owned and controlled by the people, or members, who use their services. This is an entirely different business model from banks and other financial corporations, who are controlled by a paid Board of Directors, elected by shareholders. Credit unions are not for profit, existing for the financial betterment of their members. Earnings are passed on to members via better rates and lower fees. Banks on the other hand are for profit, operating on a profit motive to make money for shareholders. This cooperative business model is attracting more and more members every year. Membership in Minnesota Credit Unions has grown 11% in the past five years.
Congress exempted credit unions from federal income tax because of their structure as not-for-profit financial cooperatives and their mission to promote thrift and provide access to credit for provident purposes. Credit unions do pay a wide variety of taxes, including employment and property taxes.
Credit unions that take pride in their “People Helping People” philosophy. In addition to the direct financial benefits, credit unions have major community give-back initiatives including:
- CU Forward Day, where 37 credit unions and partners volunteered over 12,000 hours in 80 communities impacting over 33,000 Minnesotans.
- CU4Kids raise and donate over $200,000 annually to Gillette Children’s Specialty Healthcare
- Credit unions operate 10 school credit union branches, provided free financial education classroom presentations, and donate thousands of dollars in scholarship programs
“Credit Unions continue to provide high value to Minnesota consumers,” said Minnesota Credit Union Network CEO Mark Cummins. “The cooperative model is well-aligned with the financial choices of today’s families throughout Minnesota. Our members have continued to prove that the direct and indirect advantages of healthy credit unions offer a triple bottom line return for members and communities throughout the state.”
The Minnesota Credit Union Network is the statewide trade association that works to ensure the success, growth and vitality of Minnesota credit unions. With nearly $20 billion in assets, Minnesota credit unions are local, trusted financial cooperatives that serve more than 1.7 million members at almost 400 branch locations around the state. As not-for-profit institutions, credit unions give back to the communities they serve. For more information, visit mncun.org.