credit union It is a cooperative institution with unilateral business in terms of savings and loans for core businesses. Therefore, it is often referred to as a credit cooperative (Gobbit). However, some people are confused whether this credit cooperative is the same as a Savings and Credit Cooperative (KSP) and a bank. This will be the main topic for this discussion.
credit cooperatives or credit union It first came about because a group of people or members with the same needs set up a financial institution that aimed to run venture capital. More information Let’s talk more through the reading below to know the difference between the two.
Definition of credit union
credit union It is a type of cooperative financial institution consisting of people who have the same needs and goals in running a joint venture. Ownership of this institution comes from its members. Therefore, not by external or non-member shareholders like banks do.
what to do by credit union It is a savings and loan service for money and other financial needs. However, credit cooperatives are certainly different from savings and loan cooperatives (KSPs) and banks. Considering the membership Ownership, fees, etc.
actually before Credit Union (CU) It was established with the aim of making it easier for people when the economic crisis hit Germany. Inspired by Raiffeisen, it wasn’t limited to giving money and sharing things, while it continued to empower the poor there so they could improve their welfare in the future.
credit union function
work credit union is to provide loans to people in the form of grants Check out the full explanation through the following description.
1. Providing loans in the form of capital
It is a type of cooperative. CU acts as a financial institution that can provide credit assistance in the form of business capital for business development. Therefore, the loan will not be recorded and used for personal gain. Just like in KSP and other general banks.
Principles of financial institutions credit union is to make the community or its members more prosperous The trick is to control their use of money. So that later there will be choices regarding the borrower’s background as well as their name assignment. under this system Both the borrower and the CU will benefit.
Provide business loan facility credit union It is maintained by OJK (Financial Services Authority), so customers don’t have to worry when saving and borrowing money there.
2. Organize training for members
According to the principles of Chula or Kodit, the goal is to improve the welfare of the community by controlling the use of money while helping to finance business operations. Therefore, it is not surprising that credit cooperatives Competency training is often provided to the community so that they can meet the needs of a good and prosperous life.
Training provided by the cooperative can be arranged to meet the needs of many members. Not just individuals. Examples include training on organic fertilizers. Management of household waste, handicrafts, etc. according to the needs of the community.
3. Education management for members
Other functions of credit union is to educate members to become a more prosperous society. Some examples of basic education provided by CUs include managing household finances. Information on organic fertilizers for farmers Hydroponics techniques and more
4. Providing financial services according to the needs of the community
Although it offers similar services to other banks, CU or credit cooperatives (GOD), not a banking institution It is distinguished by its ownership.
Customers can give credit or credit, savings, current account. and other financial services However, it should be noted that the ownership of a savings account is “Share Account” since becoming a member
Difference Between Credit Union and Savings Cooperative and Loan
is a type of financial institution credit union is different with Savings and Credit Cooperatives (NBTC) so as not to misunderstand again Here we will explain the difference between credit union with savings and loan cooperatives
1. Savings and Loan Service System
The services of CMU and savings and credit cooperatives are not much different, namely savings and credit, but the systems are different. However, cooperatives provide training and education to enable them to manage credit products and promote independence.
At the same time, KSP for savings and credit services can also be made available to citizens. The form of a loan can be in the form of money or goods.
2. Purposes of Members and Institutions
credit union It focuses on the welfare of its members by improving moral and physical values. In addition, this credit cooperative institute places emphasis on the independence of its members in order to be more prosperous.
meanwhile Savings and credit cooperatives tend to focus on business processes, finance, and finance. KSP sells various financial products. funded by members
Difference Between Credit Union and Bank
Although it provides financial products that are almost similar to banking institutions. but know the difference between credit union with the following general banks
1. Profit and Non-Profit
The differences between the two are pretty basic. This is evident from its purpose, that is, to be a profitable or non-profit institution. Profit institutions use it to seek maximum profit. meanwhile The main goal of a non-profit is not for profit. Instead, it focuses on empowering members.
Credit cooperatives place more emphasis on empowering or developing members. Therefore, it can be said that Chula pays more attention to meeting the needs of members in order to develop more.
In contrast to the more profit-oriented banks Benefit from the turnover of customers’ money, such as loans or installments
In the previous description Chulalongkorn University focuses on empowerment as well as member interests based on economic aspects. Therefore, it can be said that the solidarity between the members tends to be higher. Indeed, the relationships and interactions therein seem familiar and close.
while the membership of the bank is much wider. But the relationship is not close or limited to investors, shareholders, customers and customers only. Of course, it’s because the bank’s goal is to make a profit. It’s not empowering like cooperatives do.
technologically The bank is far superior to CU .. The network is also widespread, not limited to certain areas. This greatly facilitates the community in meeting their financial needs.
credit union Although the technology is not as complex as banking. However, its existence is limited to certain areas.
4. Processing fee
Benefits of being a member at credit union That is, when cash withdrawals or transactions are not subject to administrative fees. meanwhile If you transact through a bank An additional management fee is usually charged. Especially if the transfer is from another bank.
5. Types of financial services and services
when looking from Of course, banks have more comprehensive financial products and services than credit cooperatives. It’s also backed by technology that has grown from time to time.
Considering the number of branches that are less than general banks The financial product and service scope of credit cooperatives is not yet complete. The facility is even easier depending on the member.
6. Regulations and Insurance
Banks, as a rule, are regulated by federal agencies, such as government or broadly private. on the contrary credit union The rules come only from local leaders. Therefore, the insurance received by the bank is worth more than the cooperative.
7. Customer satisfaction
If judged by customer satisfaction, of course. credit union Beyond banking because CU is more focused on customers
From this description, it can be concluded that credit union Or credit cooperatives have advantages and disadvantages. It can be used as an attractive alternative to applying for a loan.