Credit unions return any surplus earnings to members in order to improve existing services, add new services, pay dividends on members' savings or issue rebates to members on loan interest. Unlike a bank that can sell stock to build its capital, a credit union must build its capital through its earnings. Members elect a volunteer board of directors, who set the policies and rates of the credit union.
Credit unions hold annual membership meetings to elect new board members.
This democratic process ensures the board remains accountable to the membership. At for-profit financial institutions, the boards of directors are accountable only to stockholders, not to customers. Credit union owners are the people who use the services The larger the credit union, the more people there are who share in its control. In other financial institutions, the vast majority of people using the services are not owners. Ownership is controlled by a small group of stockholders who may or may not use the services of the for-profit institution.