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Georgetown Kraft Credit Union was chartered in 1952 for the purpose of serving the financial needs of employees of International Paper Company and its subsidiaries. Since our original charter, we have expanded our field of membership to include anyone who lives, works, or attends school in Georgetown and Williamsburg counties.
The credit union is a not-for-profit organization, owned by its members and governed by a member-elected board of directors. Our primary purpose for existing is to encourage systematic savings through various types of investment plans, and to provide low cost loans and other financial services needed by our members. As a full-service financial institution, we continue to search for and implement new and improved services and benefits for our members.
What is a credit union?
A credit union is a member-owned, not-for-profit, cooperative financial institution formed for the purpose of encouraging savings by offering a fair rate of return. Those savings are used to make loans to members at favorable rates, as well as provide other financial services. Members are united by a common bond, such as their place of work, school, church or professional organization. In recent years, a broader interpretation of common bond has permitted credit unions to reach out to a wider membership. Some credit unions serve an entire community. Others serve multiple employee groups.
What makes credit unions unique?
Regardless of their size or field of membership, credit unions are entirely different than for-profit financial institutions. Credit unions exist solely to serve their members, who are their owners and only shareholders. Alternately, banks and other financial institutions exist to make money for their stockholders, not for their depositors.
In credit unions, the customers are called members. Each is treated as an owner, and the benefits of ownership flow back to them, usually in the form of better rates on deposits and loans, and lower fees or no fees.
The history of credit unions
Just over 150 years ago, the consumers of this and many other countries had few alternatives for borrowing. There was also no place that encouraged and openly asked for the savings of the average consumer.
The first credit union was created in 1849 in southern Germany when poor farmers got together to pool their money. The amount needed by these borrowers was too small for existing financial institutions to lend without charging excessive interest rates. The collateral available for securing consumer loans was usually deemed inadequate to allow institutions to offer any loans to consumers. Credit unions were established as a result of combining the savings and borrowing needs of consumers.
Credit unions came to Canada in 1900. The first U.S. credit union was founded in 1909 in New Hampshire. The credit union idea spread quickly after 1934, when federal legislation was passed permitting the creation of credit unions anywhere in the country. Today there are over 12,000 credit unions in the United States and 67.4 million members.
A philosophy that works
Today’s financial world is competitive and complex. Just about anybody these days can offer financial services.
Players in the financial game try to differentiate themselves and their services from the rest of the marketplace. However, credit unions have something that truly sets them apart from all other financial institutions: the credit union philosophy. Credit unions offer a philosophy of cooperation and service...a philosophy that actively puts dollars into members’ pockets instead of taking them out.
The credit union philosophy of “people helping people” and our not-for-profit, democratic structure makes us different from all other financial institutions.
Remember that the credit union objectives are:
- To protect, preserve, and safeguard the assets of the member-owners.
- To offer financial services(s) of high quality at fair rates.
- To educate members in sensible money management to improve their financial condition.
- To promote the credit union philosophy.
These ideas are demonstrated everyday through the service credit unions provide their members.
Are credit unions safe?
Credit unions, like other financial institutions, are closely regulated. They were created as a safe place for people to save and borrow money, and historically have operated in a conservative manner.
Deposits in all South Carolina credit unions are insured up to $100,000 by the National Credit Union Administration (NCUA) insurance program, which is the strongest of all federal financial institution insurers.
The credit union advantage:
Credit unions, because they are non-profit, exist only to serve their member-owners. Because credit unions are democratic, member-owned cooperatives, members have power to direct the credit union policy.
Credit union elections are based on a one-member, one-vote structure. Conversely, for-profit, financial institutions are public companies where stockholders vote according to the number of shares of stock they own.
The non-profit status of credit unions enables them to operate at a lower cost than many for-profit financial institutions. This also helps toward offering competitive loan and savings rates.
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