Why credit unions are good for small businesses: Increased lending, fewer fees, better rates

In my 20-plus years in commercial banking, I've worked for a variety of financial institutions, from community banks, to "big" banks, to where I am today, at a Long Island-based credit union. And I like it here. Why? Credit unions have increased lending to small businesses while banks have backed off. Banks have tightened their lending requirements since the financial meltdown occurred on Wall St. At the same time, credit unions have increased their small business lending. A September 2011 study commissioned by the Small Business Administration (SBA) found that both during and after the 2007-2010 financial crisis, credit unions increased the percentage of their total assets used for business lending. Credit unions treat small business customers differently than banks do. This goes back to a basic credit union principle: credit unions exist to provide financial services to all credit union members who each own one share in the credit union. Profits the credit union earns are returned to members (and small business owners can become members) in the form of lower rates on loans and higher returns on deposits. Banks are interested in returning profits to a small group of shareholders. Credit unions exist to benefit the members they serve, so those of us who work at credit unions really have a vested interest in our members' success-whether you're an individual or a small business. So if you're a small business owner looking to grow, consider partnering with a credit union. They work hard to get to know you as an individual and to understand your business. Credit unions typically offer better rates and fewer fees. It's always smart to shop around when you're looking for a loan or wondering where to get the best return on your savings or investments. One of the benefits most credit unions offer is lower interest rates on loans (both personal and small business). This is one way that credit union profits are returned to members. And what about those pesky bank fees? It pays to read the fine print. Banks are always looking for new ways to boost profits in the form of fees as a Consumer Reports article explained earlier this year. The article also includes a chart comparing average fees at credit unions vs. banks. Want to pay less in fees? Switch to a credit union. Credit unions offer a wide range of small business products and services. Product and service offerings vary depending on the credit union, but many offer a full suite of business services. You can find a variety of loans along with checking, credit card and savings accounts-most with better rates than your average bank. Many credit unions also offer additional services for payroll, remote deposit, cash management and more-just like banks-but typically for a lower cost. Credit union services are available just about anywhere due to shared branching and extensive ATM networks. Really! One of the major myths about credit unions is that if you join, you'll only have branch access in your local community and you might only have a handful of ATMs to withdraw cash. Through shared branching, members have access to thousands of branches nationwide where they can perform just about any transaction they would at their local branch-there's just a different name on the door. At NEFCU, our network-CU Service Centers-offers more than 4,500 locations to choose from. And we partner with Allpoint to offer our members more than 43,000 surcharge-free ATMs to get cash world-wide. Most credit unions also offer online banking, so you can access your accounts 24/7. Credit unions have local insight, and they want to know your business. While you can access credit union services just about anywhere, your local credit union is staying in-tune with what's going on in the marketplace nearby. This is important for small businesses. Here in Long Island we work with a number of industries that have a stronghold in our area. We make a point to reach out and network with local businesses to keep our fingers on the pulse here in our "hometown." If your business does well, the credit union you do business with does well. So it's in their best interest to find the best products and services for you. If your small business is ready to expand, consider a credit union. Unlike many banks, credit unions want to work with small businesses. Andrew Saluk is a business loan officer at NEFCU, Westbury, N.Y.