This article is by editor Linda Vergon.

Judging from the comments in Kristin Wong’s article “Credit unions vs. banks: Things to consider“ back in January 2014, there was a lot of interest – and a fair amount of skepticism – in what credit unions have to offer.

The sentiments went in a lot of different directions. People were quick to point out that interest rates on deposits at credit unions were usually much higher than at banks and interest rates on loans were generally lower.

A lot of people were very appreciative of the level of service to be found at most credit unions; but quite a few mentioned how difficult it might be to switch from one institution to another, particularly when it came to all their bill-paying information.

Others were concerned that credit unions wouldn’t have the ability to integrate with online budgeting programs and apps, while some indicated that their particular credit union worked just fine with their favorite budgeting system.

But that was fully a year and a half ago already. How much of that is still true today?

The relationship of banking and community

A lot was said about community in the comments of Kristin’s article. A couple commenters echoed Justin’s concern:

“I haven’t used a credit union because my residential location has never been ‘permanent enough’ for me to feel comfortable making that commitment.”

Apparently, some people move too frequently to consider themselves part of the community that certain credit unions serve and decline to become members because of that. Yet there are credit unions that offer membership to anyone regardless of geographic location, and shared banking also helps to eliminate that concern. So do banks still offer fewer geographic restrictions than credit unions today?

Considering the concept of community in a different light, AJ kept accounts with both types of institutions but definitely felt a strong connection to the Navy Federal Credit Union:

“I never had a reason to complain about my own banks, but I will say that Navy Federal does an amazing job of helping out its members, especially during sequestration last year. There is something to be said for the community aspect of a credit union.”

It’s hard to ignore that people value their community relationships, even when it comes to their banking relationships. So can we say that customers are completely comfortable working with an institution they can’t visit or feel connected to?

No clear winner?

Even though the overwhelming majority seemed to favor credit unions, it was still hard to draw any hard-and-fast conclusion back then. There were some very strong points made in favor of banks as well. For example, Jason’s comment reminded readers that restrictions govern some credit union accounts:

“Some CUs advertise 3% rates on checking accounts, but you only get it by jumping through hoops: 12 debit transactions of a total dollar amount, balance restrictions, etc. Those of us who primarily use credit cards for spending (and pay them every month) have little to gain by losing out on the credit rewards in return for another 2% in interest.”

Jason also said:

“We know the best savings rates are found at online banks. There are no online credit unions competing with them. And what good are low auto loan rates if you follow sound advice by paying cash?”

Getagrip hasn’t bothered with a bank for more than 20 years, but still agreed that:

“Regardless of a credit union or bank you need to look at what they provide and assess how it meets your needs. Just as different banks have varying policies, many credit unions also have different policies. With respect to the APR they pay out you also have to look at how they assess the interest.

“For example, one credit union I dealt with assessed the interest monthly based on average balance in the account. Most banks do a daily run. This can make a difference based on how you treat the account and what your expectations are.”

Ascribing value

On balance, it seemed that both credit unions and banks deserve the loyalty of their customers — and many use both types of institutions. But as an industry, banking is evolving rapidly. Many of the advanced services are offered first by the large banks. I think people make their choices based on the value they ascribe to various banking services. Convenience is a big factor, obviously. Banking relationships are important to customers. But then again, so are interest rates.

So what are the advantages of credit unions vs. banks today? What is your favorite credit union or bank – and why? What do you want to learn about credit unions’ and banks’ services today?

[Are you a super saver? We will be profiling American families who have become successful savers in weeks to come, and we’d love to hear your savings story. What types of savings accounts do you use?

If you would like to be profiled email Editor Linda Vergon at lvergon@getrichslowly.org.]

GRS is committed to helping our readers save and achieve their financial goals. Savings interest rates may be low, but that is all the more reason to shop for the best rate. Find the highest savings interest rates and CD rates from Synchrony Bank, Ally Bank, and more.