The document provides an overview of credit unions as an alternative to banks, highlighting their advantages such as being member-owned and non-profit, which allows for lower fees and better interest rates. It also addresses disadvantages like limited services and fewer branch locations. Furthermore, trends indicate that more consumers are shifting to credit unions for their financial needs, particularly due to rising dissatisfaction with traditional banks.

1. Financial Services Industry Training
Overview of
Credit Unions
The Alternative to Banks
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Saunders Learning Group, LLC, Andover, KS

2. Training from Saunders Learning Group
Saunders Learning Group provides a variety
of training programs, workshops and
seminars targeted to the financial services
industry.
Programs are available in a wide range of
topics, and we are specialists in developing
custom programs that are targeted to your
needs.
Contact the founder, Floyd Saunders at
316-680-6482 or at
floyd@floydsaunders.com for more
information.
Saunders Learning Group, LLC, Andover, KS
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3. Advantages of Credit Unions
 Customers are owners
 The owners and customers are one in the
same. Any decisions about fees, products
and services benefit everyone.
 Credit unions are non-profit
 Any profits from operations are returned
to the owners/members in the form of
dividends.
 Lower fees and higher savings rates
 Free accounts with no or low minimum balance requirements
 Interest rates on savings, certificates of deposit etc. are typically better
than at a bank
 Interest rates on loans and credit are often lower
 Because a credit union does not have to make a profit like a bank, it can
typically offer lower rates on loans and credit cards.
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4. Disadvantages of Credit Unions
 Limited Branch Locations and ATMs.
 Many credit unions only operate in one location.
 But may be part of an ATM network
 Most Are Insured, but Not All.
 Like banks and the FDIC, a federal credit union is also insured by the U.S.
government. The National Credit Union Administration, but not credit unions
are insured. Look for the name “Federal” as this would indicate they are
chartered by the NCUA and insured. When in doubt, ask.
 Fewer Services.
 Credit unions don’t offer the wide array of services that full-service banks do.
 If you need a large commercial mortgage loan, for example, your local credit
union may not be able to provide you with one.
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5. Credit Unions
 Credit Unions are similar to banks, except for the
following differences:
 Credit Unions are member owned. Each
depositor is issued shares of ownership based
on deposits held
 Profits are returned to the members in the
form of dividends to their savings account
 Interest rates at credit unions are typically less
than at banks for loans, due to their non-
profit, member owned status.
 Credit Unions offer customers many of the
same products and services as retail banks.
 Credit Unions are formed by the members
having a common interest (working at the
same company for example).
 Credit Unions are chartered and regulated by
the National Credit Union Administration.
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6. Trends in the Credit Union Market
While the number of credit unions have declined in the financial crisis, they are a force that serves the needs of its
members. Loan growth has started to increase as the financial crisis of 2008-09 fades.
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7. More Consumers are Turning to Credit Unions
 Year over year growth in core deposits at credit unions came in at 14.6% in
2011
 Consumers voted with their feet as they left banks set on charging even more fees to their
customers and moved money to credit unions.
 Credit unions first mortgage market share is at a high point with 6% of market share in 2011.
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8. Credit Unions
Function Provides consumers with a wide range of banking products and services designed
to meet the needs of a varied customer base.
 Acceptance of deposits in to checking and savings accounts
 Transaction processing for deposit accounts
 Issues credit cards and processes merchant transactions, payment processing
 Arranges safe deposit boxes for customers
Example  Sells certificates of deposit, retirement accounts
Activities  Provides for transfer of funds
 Provides banking via ATM machines and mobile devices
 Arranges a variety of personal loans
 May also process applications for mortgage loans
Example Credit Unions perform similar functions, provide most of the same
Companies products and services as banks. The largest include the Navy Federal and
Pentagon Federal Credit Unions, State Employees (North Carolina) and The
Golden 1 Credit Union in Calif.
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9. Credit Unions Products and Services
Checking & Savings, ATM cards
Online Banking
Mobile Banking
Payment Processing
Loan Products – Home, Auto, Personal, Credit Cards
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10. Types of Accounts
1. Checking accounts are a type of deposit account for the purpose of
securely providing access to funds on demand, via checks, ATM
transactions, and transfers of funds.
2. A deposit account is a savings account, money market or time deposit at
a bank that allows money to be deposited and withdrawn by the account
owner (s).
Also referred to a Savings Deposit Account (SDA).
3. Money market accounts is a deposit account with a higher rate of
interest paid for higher balances.
4. Time Deposit Account (TDA) is a deposit account that cannot be
withdrawn for a fixed period of time, unless an early withdraw fee is
paid. In most cases the longer the term of deposit the better the yield
on the deposit.
5. Transactions are recorded on the bank’s books and the resulting balance
is reflected as a liability for a bank on it’s books.
6. Some credit unions may charge fees for services, and in most cases the
credit unions will pay the customer interest on funds deposited.
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11. Automatic Teller Machines or ATMs
 An automated teller machine (ATM),is a telecommunications devices used to store and dispense
cash, allow account holders access to accounts and to perform a variety of financial transactions
including transfer of funds, payments, and cash advances on credit cards.
 Many credit union-issued ATM cards are linked to the Credit Union 24 or Co-Op ATM network,
which eliminates surcharge fees for credit union members. These ATMs are located frequently
traveled locations such as 7-Eleven, Costco and Walgreens across the country.
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12. Online Banking
 Consumers use online banking to check balances, pay bills and transfer funds.
 Credit Unions that provide online banking can reduce processing costs and provide a wide
range of services to customers 24 hours day from anywhere.
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13. Online Banking
Online banking is more than 1/3 of the transaction volume at most banks and credit unions.
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14. Mobile Banking – Growing Rapidly
 Customers do banking on their mobile devices
 87% of Americans have a mobile phone, half of those are smart
phones
 21% of mobile phones users have done mobile banking in 2012,
double the rate from 2011
 30% of banking customers will use mobile banking by 2013
 The Fed pulled together all the survey numbers and concludes
that at least one in three American banking customers who own a
smartphone will engage in mobile banking by 2013.
 The most common use of mobile banking is to check account
balances or recent transactions (90% of mobile banking users).
 Transferring money between accounts is the second-most
common use of mobile banking (42% of mobile banking users).
 The primary reason why mobile phone users had not yet adopted
mobile banking was that they felt their banking needs were being
met without the use of mobile banking (58%).
 62% of the under banked who use mobile payments have used it
to pay bills.
Saunders Learning Group, LLC, Andover, KS

15. Typical loan decision process
Customer Bank
Loan application performs Yes Loan docs
requests a Credit prepared
is completed credit
loan (could be online)
Decision
analysis
Credit No
Report inform customer
Employment
Verification
Customer Bank Bank
prepares Bank
signs verifies Loan systems
accounting funds loan Loan serves
loans documents entries updated
This generalized process is followed for all loan types, with different loans requiring more documentation
or verification. For example a loan secured by real estate needs an appraisal to set the value of the
property. Inventory financing might need to be secured by a lien on the inventory. Title to an auto would
be retained by the bank until the loan is paid off etc.
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16. Questions
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17. Post Workshop Action Plan
 Complete the Post Workshop Action Plan
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18. Thank You !
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Saunders Learning Group, LLC, Andover, KS

19. About the Author/Presenter
 Floyd Saunders has worked on Wall Street
with both Bank of America and JPMorgan,
where is was a vice president in global
financial systems. He has worked across the
industry in retail, commercial, and
investment banking.
 He has taught courses in Money and Banking
and extensively for the American Institute of
Banking and various colleges.
 As a consultant, he developed and taught a
wide range of banking and investing courses.
 He authored three programs for the
American Bankers Association: Banking on
Mutual Funds and Annuities, Introduction to
Securities Markets and Investing in Securities.
 He is the author of “Figuring Out Wall Street”
and his next book is “Family Financial
Freedom” a book on personal money
management.
Saunders Learning Group, LLC, Andover, KS

20. Reference Material
Figuring Out Wall Street Consumer’s Guide To
Financial Markets
By Floyd Saunders
Publisher: Saunders Learning Group
ISBN: 978-0-9824019-0-3
Available from Amazon:
http://www.amazon.com/Figuring-Out-Wall-Street-
Consumers/dp/0982401906
and many other online book stores.
Book summary: Figuring Out Wall Street, is the
concise guide to help everyone understand how what to do
now to restore our financial systems. Written in an easy to
understand manner, even the most complex financial
concepts are easy to digest. This book provides help to
monitor investments with a review of investment products,
financial regulators and economic indicators. Learn how the
stock market exchanges work and the world of investment
banking, hedge funds, venture capital and private equity.
Every chapter includes action plans for investing.
Saunders Learning Group, LLC, Andover, KS