Strong credit unions help business, consumers
To the editor:
It's disappointing to see Mountain One Financial President/CEO Robert J. Fraser attack the not-for-profit status of credit unions. (Letter, May 31.)
To set the record straight, the PolEcon study was bought and paid for by the bankers. They have used the same, tired approach in states like Vermont and New Hampshire and consumers have seen through their weak attempt to paint credit unions as bad actors.
Credit unions were created to provide consumers and small businesses with high-quality, low-cost financial services. We do that in a very tangible way in the form of better rates, lower fees, and exemplary service to our member owners.
In 2015, Massachusetts credit unions delivered $328 million in direct financial benefits to the commonwealth's 2.6 million members in the form of better rates and lower fees compared to other financial providers. That $328 million may not mean a lot to the high-profit banking sector, but it means a lot to the members we serve — especially in these tough economic times.
Let's take a few everyday examples of the credit union difference. In 2015, the average late credit card fee was just $24 at a credit union compared to $34 at a bank; the average mortgage closing costs were $1,151 at a credit union compared to $1,361 at a bank; and the average rate on $1,000 savings account was .46 at a credit union compared to just .14 at a bank. These are tangible benefits that help consumers struggling to make ends meet.
It's hard to feel sorry for the banking sector. It has near record profits and a dominant market share. While state credit unions have 6.7 percent of deposits, the 25 largest state banking institutions account for nearly 80 percent of total deposits in the state. Do they not believe in competition?
Credit unions do not waste members' resources attacking banks. In fact, we believe in a strong banking system and a strong, dynamic credit union system. When credit unions and banks compete, consumers and small businesses win.
Let's stop the rhetoric and let's find ways to help people meet their financial goals. Rather than shooting at the credit union system, banks should look to partner with us on things like financial education, elder financial abuse and other pressing issues facing consumers.
Paul Gentile, Marlborough, Mass. The writer is president/CEO, Cooperative Credit Union Association.