Cooperative Principles

Unlike a bank, credit unions are owned, operated and controlled by their members. The main objective of credit unions is to give member-owners an opportunity to save for the future, make intelligent use of credit and use personal financial counseling to effectively manage their money.

Because credit unions are not-for-profit cooperatives, they have no stockholders to satisfy. Therefore, credit unions return any profits made back to the members in the form of cost-savings and better service.

Credit Unions are highly organized, closely regulated, operate in a very prudent manner and each account is insured up to $250,000 by the National Credit Union Administration, an agency of the federal government.

Membership in credit unions is free and open to groups that share something in common, such as where people live, work, or attend church, for example. The services of credit unions are the same or similar to those provided by other financial institutions.


Not-for-profit cooperative

For-profit cooperative

Primary Objective

To meet member/owner needs

To maximize profit


All members who are users of services

Stockholders who may or may not be customers or users

Directors Volunteers

Paid Directors


Member-controlled, one vote per member

Only stockholders vote, one vote per share of stock

Distribution of Net Income

Dividends issued to members and used for capital development, additional locations, equipment, etc.

Dividends issued only to stockholders

Community Links

Owners/leaders reside or have an interest in the community

Owners/leaders may live anywhere in the world; headquarters could be anywhere in the U.S.


Offer better overall rates and lower fees due to the nature of the organization and its dividend distribution

Rates and fees may not be favorable because of for-profit status

Generation of Capital

Generated only through income stream

Generated through income stream and/or issuance of stock

Who Benefits



From The Credit Union Difference a periodical printed by the Missouri Credit Union Association and printed in the Kansas City Star September 2007


As a cooperative, Heartland Credit Union operates according to the same core principles and values, adopted by the International Co-operative Alliance in 1995. Cooperatives trace the roots of these principles to the first modern cooperative founded in Rochdale, England in 1844.


  • Voluntary and Open Membership
    Cooperatives are voluntary organizations, open to all people able to use its services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.
  • Democratic Member Control
    Cooperatives are democratic organizations controlled by their members-those who buy the goods or use the services of the cooperative-who actively participate in setting policies and making decisions.
  • Members' Economic Participation
    Members contribute equally to, and democratically control, the capital of the cooperative. This benefits members in proportion to the business they conduct with the cooperative rather than on the capital invested.
  • Autonomy and Independence
    Cooperatives are autonomous, self-help organizations controlled by their members. If the co-op enters into agreements with other organizations or raises capital from external sources, it is done so based on terms that ensure democratic control by the members and maintains the cooperative's autonomy.
  • Education, Training and Information
    Cooperatives provide education and training for members, elected representatives, managers and employees so they can contribute effectively to the development of their cooperative. Members also inform the general public about the nature and benefits of cooperatives.
  • Cooperation among Cooperatives
    Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.
  • Concern for Community
    While focusing on member needs, cooperatives work for the sustainable development of communities through policies and programs accepted by the members.