Which type of financial institution typically has membership requirements?

Which type of financial institution typically has membership requirements?

a) credit union
b) online commercial bank
c) commercial bank
d) federal reserve bank

[bg_collapse_level2 view=”button-orange” color=”#4a4949″ icon=”arrow” expand_text=”Show Answer” collapse_text=”Hide Answer” ]

The Correct Answer for the given question is option a) credit union



Credit Union are the type of financial institution that typically has membership requirements

Unlike banks, credit unions must have a defined field of membership, so you can only access their services if you belong to that group. There are many types of memberships, including employer, church, school, community and employee groups. To join a credit union, members must share something in common. In order to join most credit unions, you have to work for a certain employer, live in a specific area, be a part of a particular group (such as a school or a labor union), or have a family member who is already a credit union member. The easiest way to join is through your employer, however many communities have their own credit unions as well.

Credit unions differ from banks not only in their membership requirements, but also in their ownership and operations. All members of the unions can also vote for the board of directors and volunteers who make up the board. A union that adopts this approach will provide greater transparency and accountability, making it a safe place to save and borrow. As another noteworthy difference, credit unions are not-for-profit organizations, unlike banks.

Due to the fact that the owner and client of a credit union are the same, this type of financial institution is committed directly to improving the well-being of its members. A credit union’s profits increase savings rates, lower loan rates, and reduce fees for members as a result. Thus, the simple fact that membership is required reveals the differences in ownership, functions, and ultimately motivation that exist between credit unions and banks.

Who elects the governing body of a mutual insurance company

Leave a Comment