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Triangle Credit Union is a Member-Owned Financial Co-Operative

By S. Mathur

Banks and credit unions offer similar services and products, but there is a significant difference in the goals of the two institutions. Richard L. Lavoie, Senior VP Marketing, explains that "The significant difference lies in the governance and responsibilities. Banks are a for profit institution, whereas credit unions are not for profit. Credit unions are bound by their charter to return all earnings back to the members in the form of dividends less expenses."

Banks are accountable to their stockholders and their responsibility is to increase profits for the stockholders. Credit unions on the other hand are accountable to their members or account holders i.e. those who have deposited money in the credit union. This distinction leads to a whole range of practices which benefit shareholders in the case of banks, and members or depositors in the case of credit unions.

Lavoie says that "The board of directors at a bank are typically paid or reimbursed in some fashion for their service. Banks generate income from fees and service charges. Deposits are insured by the FDIC. Credit unions' board of directors are volunteers and unpaid. Typically at a credit union you will find minimal fees and service charges, lower loan rates and higher interest rates on your deposits. One member's savings can virtually be another members' mortgage. Deposits are insured by the NCUA."

Triangle Credit Union (TCU) began in 1939 with 180 members and assets worth $2,150. It now has more than 40,000 members and more than $500M in assets. It has branches in Nashua, Manchester, Amherst, and Derry, and offers online banking, mobile banking, savings, checking, audio response banking, auto loans, mortgages, and commercial lending and business services. Membership is open to anyone who lives or works Hillsborough, Merrimack, Belknap, Rockingham and Cheshire Counties in New Hampshire, and Franklin, Worcester, Middlesex and Essex Counties in Massachusetts.

TCU's mission requires it "to identify our existing and potential member needs and to meet those needs through progressive, cost efficient products and services, while maintaining a strong financial position." It can be best described as a not-for-profit financial cooperative, owned and operated by its members. The goal of the credit union is to promote savings and provide a source of loans for members.

Businesses wishing to apply for a loan through TCU must be registered as doing business in the state of New Hampshire. The first step in applying for a business loan says Lavoie, is to "open an account with the credit union and become a member. Once membership is established a loan application is completed and submitted to our commercial services department.

The application must be accompanied by a business plan, personal financial statement, and tax returns." A decision is made within one week. Requirements for individuals to qualify for a loan are: membership in the credit union, stable employment, sufficient income, acceptable debt to income ratio, and established credit history. Applications can be made in person, online or by phone.

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