What Is The Difference Between A Credit Union And A Bank

What Is The Difference Between A Credit Union And A Bank, From the outside, banks and credit unions seem very similar. They both offer checking and savings accounts, financial products like CDs and specialized accounts, and the rest of the services we’ve come to expect. You drive through teller windows or stop in at a branch, deposit your checks or withdraw money, and occasionally meet with personnel to discuss your financial needs. ATMs, debit and credit cards, loans and mortgages are all on the menu at most banks and credit unions. You give them your money, and they give it back. Right?

But under the surface, the two types of financial institutions couldn’t be more different. You may have noticed how excited and involved credit union (CU) members tend to be with their institutions, or the reputation CUs have for being small, regional or community-oriented. Perhaps you’ve heard about the intense lobbying the banking industry regularly levels against credit unions and wondered why it’s so aggressive.

There are benefits and costs to both operations, of course. But learning about the way credit unions work — and what sets them apart from banks — gives some interesting insights into the way we deal with money in this country. Most of us don’t use half the opportunities our financial institutions offer because it can be so overwhelming to make decisions about these things. For many of us, it’s hard enough just making sure our checks don’t bounce at the end of the month!

In this article, we’ll look at the basic business structure of banks and credit unions, the reason they do the things they do and the ways we use their services. Read on to learn how to choose between the two!

Dodd Frank Act Of 2010

Dodd Frank Act Of 2010, The Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub.L. 111-203, H.R. 4173) is a federal statute in the United States that was signed into law by President Barack Obama on July 21, 2010. The Act implements financial regulatory reform sponsored by the Democratically controlled 111th United States Congress and the Obama administration.

Passed as a response to the late-2000s recession, the Act brought the most significant changes to financial regulation in the United States since the regulatory reform that followed the Great Depression, representing a significant change in the American financial regulatory environment affecting all Federal financial regulatory agencies and almost every aspect of the nation’s financial services industry.

As with other major financial reforms, some legal and financial scholars on both sides of the political spectrum have criticized the law, arguing on the one hand that the reforms were insufficient to prevent another financial crisis or additional “bail outs” of financial institutions, and on the other hand that the reforms went too far and would unduly restrict the ability of banks and other financial institutions to make loans.

In addition to the headline regulatory changes covering capital investment by banks and insurance companies, the Act introduces new regulation of hedge funds and private equity funds, alters the definition of accredited investors, requires reporting by all public companies on CEO to median employee pay ratios and other compensation data, enforces equitable access to credit for consumers, and provides incentives to promote banking among low- and medium-income residents.