On Guy Fawkes Day, Join A Credit Union

That’s the idea behind Bank Transfer Day, organized by California citizen-activist Kristen Christian. No she doesn’t work for a credit union. No, she’s not part of Anonymous or OccupyWallStreet.

Her motivation? The response of Bank of America et al to a rule finalized this summer that would restrict banks to a maximum of 21¢ per debit-card transaction. In response, the banks said that they would charge consumers $3-5/month for the privilege of using a debit card for a transaction. Think about this for a moment — debit cards immediately draw from your checking account and the transaction is electronic. Compare that with writing a check, both in terms of time lag (the float) and labor. (Yes, some larger retailers have instant check scanning/debiting services but most retailers do not.)

It’s not a small market: Bank of America reported total debit card purchases in 2009 at $218 billion. Total Visa debit card volume in 2010 was $1.05 trillion; MasterCard added another $333 billion.

Credit unions exist across these United States.

A credit union is a cooperative financial institution, one that is operated for the benefit of its member-owners, not third-party investors. All profits stay in-house, so to speak. Credit union members have something in common such as geography, employer, school or membership organization and they elect the board that manages the credit union.

Federal credit unions are chartered and supervised by the National Credit Union Administration (NCUA). Your money is insured in a manner similar to the FDIC (and at the same level). If you are worried about having access to ATMs outside of your local region, make sure your credit union belongs to the Credit Union Service Centers network. There’s even an iPhone app to make finding a location easy.

Disclaimer: I am a member of the Boeing Employee Credit Union.

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  • slamfu

    This is an outstanding idea, one I was thinking should be done ever since the banks took our bailout money and failed to loosen credit up for small business loans. I will be doing this :)