Pewaukee, Wis. – Credit unions, which are member-owned financial institutions that do not have stockholders, saved 2.2 million Wisconsin consumers $201 million through competitive rates on savings and loans and lower and fewer fees for financial services, according to the REAL Solutions Scorecard for Wisconsin Credit Unions, a report by the Wisconsin Credit Union League.
Members of credit unions, the report says, saved more than $128 million on loans, earned more than $36.6 million on savings products and paid $36.5 million less in fees than if they had used a for-profit bank. Most credit unions still offer free checking, a member of any credit union can save almost $1,000 on a five-year new car loan, and the average household saves $164 a year by using their credit union’s services, the report said.
The report also cited additional value from credit unions via services like almost 30,000 hours of free financial counseling that have prevented home foreclosures and improved borrowers’ creditworthiness, free tax preparation for low-income filers, outreach to new Americans, financial education within schools and more. Those services are part of a voluntary – not mandated – effort by credit unions called REAL Solutions to help families and small businesses in ways that for-profit financial institutions typically won’t extend themselves.
Since the start of the recession in 2007, the report says, credit unions increased their lending to small businesses 51.8% to compensate for a lack of available business credit from banks. A whopping $44 million of the savings on financial product usage accrued to lower-income consumers; credit unions, in fact, operated 40% of all the financial institution branches in low-income areas.
The vast majority of credit unions offered loans of $500 or less at modest interest rates – an alternative to costly payday loans. And credit unions also outperformed non-credit union lenders by approving 65.2% of home loans for low-income borrowers and 71.1% of home loans for minority borrowers, compared to a 56.6% and 57.2% approval rate by others, respectively.
Credit unions also run 97 branches inside schools to teach young people to save; students statewide stashed $3 million in their in-school accounts. Credit unions delivered 5,460 presentations to 34,104 consumers to improve their financial savvy, sponsored Wisconsin teachers to attend summer workshops that help them improve financial lessons offered in classrooms, and purchased 49,700 copies of a personal finance magazine to help 405 teachers at 350 high schools teach money management in line with state teaching standards.
Additionally, credit unions engaged close to 15,000 students in financial decision-making through reality fairs and the online game Money Mission®, supported close to 3,000 charities, granted $114,150 in scholarships and delivered 60,000 hours of online training to 5,476 employees from credit unions and Wisconsin firms to encourage investing.
Because of credit unions’ member-ownership – which centers credit unions’ values on people, not profits – every credit union is fundamentally different from every bank. Learn more at http://www.theleague.coop/scorecard.
