My reward checking account with a credit union is fully up and running. I got my first monthly interest at the end of September. As expected, I got 3% APY on my $20k deposit for having used my debit card 18 times during the month. Those 18 debits came to a grand total of $91.34. I’m expecting another $50 or so in interest for the month of October.
Having gone through the whole process of setting up an account with a credit union, I’d like to reflect where a credit union is doing better than big banks and where big banks are doing better than credit unions.
Open Account Online
Around this time last year, I opened accounts with Chase and Citibank. In both cases, I was able to open the account completely online. I didn’t have to call anyone or receive calls from anyone. After I filled out the application online, I was able to set up online login and password and set up ACH transfers as direct deposit. I was up and running in 30 minutes.
It’s more clunky at this credit union. After I filled out the online application, I received an email from a manager at the branch asking me to send in a copy of my driver’s license and secret answers to some security questions ("your favorite blah …"). I also had to sign a re-typed account application. Thankfully I was able to electronically sign it through DocuSign.
The online application for this credit union apparently doesn’t really open accounts. It’s merely a data gathering tool.
After the round of documents, the manager called me again. She gave me my member number, my temporary password for online access, the routing number, my account numbers and a walkthrough of how everything works. She also gave me her direct line and her email address for any questions I have in the future.
I never had a personal banker. Having access to a single point of contact beats calling a random customer service rep at a call center.
Choose Your Own Online Login
I was able to choose my own online login at all the big banks. This credit union only allows logging in with my credit union member number, which I can never remember. Google search shows this practice is not that uncommon at credit unions. Why do credit unions do this? It beats me.
Change ATM PIN
The debit card came in the mail about a week after the account was opened. A day later a PIN came in a secure mailer. I don’t expect to use the PIN but I wanted to change it to something I can remember just in case. I looked for how to change it left and right in online banking but I couldn’t find it. Customer service told me it’s in online banking but they couldn’t tell me exactly where.
I finally broke down and sent an email to the manager at the branch. She replied saying I can’t. There’s no way to do it online or on an ATM. I can change it only if I come into the branch, which is very far from me.
Oh well.
Customer Service
Having a personal banker for customer service is nice, but that also means her service isn’t 24/7. There’s no phone number on the back of the debit card. There is a 24/7 phone number listed on the credit union’s web site. When I called, although the person answered with the name of the credit union, it was obvious to me she wasn’t working for the credit union exclusively.
This is the case at my other credit union as well. If you call in the evening or on weekends, the off-hour crew don’t know much and can’t do much. They often ask you to call again during business hours. It’s more like an answering service.
Online Banking
Every bank and credit union offers online banking. Online banking, however, is not created equal.
Big banks, with a large IT budget, offer better user experience. This credit union’s website has a 1997 Geocities-era look. There is no way to link an external account (must push or pull from outside). Bill payments are done on a third-party website that requires a separate login and password.
Mobile Banking
Big banks all have a mobile app. This credit union does not. It offers mobile web, but it’s on yet another third-party web site with yet another set of login and password.
***
I’m OK with bare bones because I’m not using the credit union for my primary checking account. I can see why others would prefer a big bank.
So where are big banks doing better than credit unions? Big banks provide services customers come to expect as "standard." They provide those services where, when, and how customers want. Most people don’t pay any fee when they have direct deposit, keep a minimum balance, and never overdraft. Keeping a minimum balance costs very little in lost interest these days.
If you are using a big bank, don’t feel like you are missing something for not using a credit union. Despite being frequently bashed in the media, big banks actually offer a better value than many credit unions.
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Robert Bugsch says
Enjoy your banks. C/U’s are the way to go!! If I ever set foot in a bank again, it will be too soon!!!!!
Washerdreyer says
By any chance have you tried integrating your account at unnamed credit union with a mint.com account? I’m considering following your example vis-a-vis emergency fund, but am slightly worried about keeping track of my progress on the monthly debit transactions requirement. Mint would make that much easier, so just want to confirm that despite being low-tech that’s doable with this credit union.
Harry says
I don’t know whether mint.com supports it. I don’t use mint.com.
washerdreyer says
Ok, thanks for the help, I have a vague memory of having seen on a different site that someone was able to use Mint with them.
Harry says
If you already have a mint.com account, just try to add a new account with the credit union even if you don’t have an account yet. If mint.com doesn’t support it, I imagine it will say so.
alanb says
Washerdreyer: Another instance where big banks are better(in my experience, at least). My credit union won’t allow Mint.com to log in to my account unless I’m already logged in on another browser. No problem with my national big bank accounts. Maybe your CU will be more receptive!
TJ says
Not all Credit Unions are as low budget as you imply.
Alliant has always had a relatively high interest rate for savings and checking, it’s a good hub for ACH and you can pick your own username. You also choose your own PIN.
Harry says
I still have my primary checking account at Alliant. It’s definitely more streamlined than this other credit union. However, its rate on the savings account is no longer competitive with other online banks. If I’m starting fresh I wouldn’t use Alliant.
Steve says
I have an account at a credit union and don’t find any of the drawbacks you encountered. The phone number for the support line is on my debit card and it’s truly 24/7. The web site is great and they have mobile apps for every platform. I was able to choose my username (I can tell you why that feature doesn’t exist for your example CU – because they never created that feature. Features don’t exist in websites, or anywhere else, until someone creates them!). I can’t speak to account creation, though their loan process was, similar to what you found, more of a data gathering form than anything else.
Christy L says
I disagree with just about all of your bank superlatives, but I have been a member of Navy Federal Credit Union since the 70s and they are hard to beat!
I heartily recommend them to all service members and any family members joining through them. The branch of service doesn’t matter-
Good luck.
Chris
TJ says
@Harry,
I have active accounts with three credit unions. I find all websites to much more user friendly than say, BBVA Compass (for the ‘build my savings’). Is that not a ‘big’ bank?
Harry says
BBVA is big in Spain and in Latin America. The Compass part isn’t that big in the U.S., at least not nationally. FDIC data show it ranks No. 26 by deposits.
BBVA “Build My Savings” is set-and-forget for me. I don’t use its website except checking my balance once a month. I received $500 in matching bonus on my two accounts after one year as promised. It’s a pretty good deal.
Jane says
I recently had a terrible experience with my credit union and an international money transfer. It just happened that that week I needed to transfer money was the week my local credit union banker was on vacation and so I had use the 1-800 service and there were not on top of it. They took a week to figure out what they were doing and every day I called and said it would happen *that* day and of course I called the next day and it hadn’t happened yet. I would never use them for a money transfer again. I used to be a big fan of my CU, but now I am concerned about keeping my chunk of cash their to earn interest because they were so incompetent.
Sam Seattle says
Your point is convincing, Harry. The many credit unions I belong to have bare-bones website, poor phone customer service.