Credit Union Difference

A credit union is a financial cooperative that encourages savings and aims to educate their members to enhance their social and economic well-being. Once overheads and other expenses are paid, any income is returned to customers in the form of interest on savings, increased reserves and improved or additional services.

Credit unions are registered under the Friendly Societies and Credit Unions Act 1982 and are not registered banks. They are locally owned by their customers, not-for-profit and are a trusted alternative to banks. Members are able to both save and borrow at reasonable rates of interest and with a sensible approach to fees and other charges.

Being 100% New Zealand-owned and operated, members' funds are retained in New Zealand and are not used to fund any offshore investments.

Under the Securities Act 1978, credit unions are subject to a regulatory regime, where an independent trustee company acts as their prudential supervisor. Credit union deposits are shares secured by a first ranking registered Trust Deed. Credit unions are also regulated by the Reserve Bank of New Zealand as deposit takers. This provides an additional layer of protection and comfort that each credit union is being strictly regulated and their performance monitored.

The International Credit Union Principles are the foundation for how credit unions differ from other financial institutions. The principles provide frameworks for credit union operations, governance, safety and soundness.

> learn more about the International Credit Union Operating Principles.