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.
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.
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.
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.