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What’s a Credit Union?

The Beginning of the Credit Union Movement

Credit unions emerged in the 1800’s because of a void created when reputable leaders showed little interest in serving the financial needs of the wage earner. The birth of credit unions was founded under one simple idea- people working together and pooling their savings can create a valuable credit resource not otherwise available to them.

The first credit union was organized in Germany in 1848 by Friedrich Raiffeisen, mayor of a rural village. That anniversary is recognized throughout the world in annual celebrations of Credit Union Day (the third Wednesday in October) and Credit Union Week which encompasses that day.

Credit Unions in North America

Alphonse Desjardins, a Canadian, first organized a credit union in Levis, Quebec and also organized the first U.S. credit union in a New Hampshire parish in 1909. Edward Filene, a Boston merchant and philanthropist later spent a million dollars to further promote the idea in America.

The credit union idea emerged in Ohio in the early 1930’s. In 1931, the Ohio Credit Union Law was enacted. The first charter in Ohio was issued to Farm Bureau Employees Credit Union of Columbus. By 1932, Ohio had 18 credit unions with 4,102 members and combined assets of $184,059. Today, more than 2.7 million Ohioans (about 20% of the state’s population) belong to credit unions through associations with their employers, communities, churches, or occupations.

Who Can Join a Credit Union?

The members of each credit union must share a “common bond”, such as being employed at the same workplace, belonging to the same church, or living in the same neighborhood. According to the bylaws of most credit unions, all of those in the immediate family of a member are also eligible to join. This may include parents, children, spouses, or others related by blood or marriage.

Why are Credit Unions Unique?

Because credit unions are not-for-profit financial cooperatives, they can operate solely to meet the needs of their members. Credit unions offer a variety of savings and lending services based on membership needs.

Credit unions are governed by their members, for the benefit of the members, each having an equal voice in the operation of the credit union. The membership annually elects unpaid, volunteer officers and directors who establish the policies under which the credit union will operate. Officials must be from within the membership. Voting is under democratic principles, with each member having one vote, regardless of how much money a member has in shares (savings).

How to Join a Credit Union

A person must be within a field of membership to join a credit union. To become a member of Commodore Perry Federal Credit Union, you need to live or work in Ottawa County, or be a family member of an existing member.