The owners of a credit union are its individual members and it is run for the benefit of its members. Its members pool their savings to provide loans at favourable rates of interest. Credit unions are started, and mainly run, by volunteers, at least while still small. Many credit unions are small, based on neighbourhood or local church community, but some are very big. Each member has one vote regardless of the amount of his savings or the size of his loans.
Policy is decided, and officers are elected, at an annual meeting.
Each member pays a small joining fee and saves regularly with the credit union. Any surplus after paying expenses and adding to reserves is distributed to members. A member may get a fixed rate of interest on his savings or he may get a fixed rate of interest plus a dividend which distributes any remaining surplus. After saving regularly for a qualifying period, borrowers may take out loans of up to 1.5 per cent of the credit union's funds on top of the value of their own savings. It is often a legal requirement that each credit union needs to have a 'common bond of membership', each member living in the same area, or working for the same employer, or being a member of a trade union, or of some other special interest group.