Final answer:
The statement that banks are private for-profit institutions and credit unions are nonprofit organizations owned by their members is a. true.
Step-by-step explanation:
True, banks are typically private for-profit institutions whereas credit unions are nonprofit organizations owned by their members. Credit unions offer many of the same services as banks, such as accepting deposits and providing loans. However, unlike banks, credit unions are owned and operated by their members and profits are returned to these members in the form of lower fees, better interest rates, and improved services. The typical credit union is smaller in size compared to most banks, but they play a significant role in providing financial services to different communities and groups.
The National Credit Union Administration (NCUA) supervises credit unions, which underscores their legitimacy and importance within the US economy. There are over 6,000 credit unions in the United States alone, and while each one may be small relative to the average bank, collectively, they have a growing amount of total assets.
- Banks are private for-profit institutions.
- Credit unions are nonprofit organizations owned by members.
- Credit unions focus on serving their members with lower fees and better rates.