Credit Unions serve members, communities

While credit unions offer the same services as other financial institutions, their very purpose is different, according to Don Ack-erman, president and chief executive officer of TelComm Credit Union. "We're a not-for-profit financial cooperative," he said. "We exist to serve our members, not to make a profit."

TelComm Credit Union was formerly Springfield Telephone Em-ployees Credit Union; the name change took place at the first of the year, Ackerman said.

"It was kind of a long process to determine the new name," he said. The credit union was instituted as a benefit to Southwestern Bell employees, he said, but with the deregulation of the telephone industry, that company downsized, and the credit union began ac-cepting other employee groups.

"We have about 125 employee groups right now," said Ack-erman. "Also, we were able to change our charter to a community charter, so we recently changed our field of membership to include anyone residing or working in the 417 area code."

Now anyone who lives or works in that geographic region is eligible to become a member/owner.

So, he said, "we needed a name that better explained who we are and who we serve."

The "Tel" part of the name embraces the credit union's history, while the "Comm" stands for "community," said Ackerman. "That is our future, branching out and providing financial services to this community."

TelComm's main office is at 2155 E. Sunshine St.

Membership

Membership requirements vary from one credit union to another. Southwest Teachers Credit Union, located at 1221 E. Grand St., is open to teachers at the elementary, secondary and college levels in southwest Missouri, said president and chief executive officer Steve Wansing. "Basically, any teacher in the area is eligible," he said. "We can also take in administrators, secretaries, bus drivers any school staff. They don't have to be full-time employees."

Southwest Teachers Credit Union has 7,595 members, he said.

Springfield's largest credit union, in terms of both local members and total assets, is Postal Federal Community Credit Union, which has its main administrative offices at 1983 E. Seminole St. Accord-ing to the Springfield Business Journal's 2001 "Springfield Credit Unions" list, Postal Federal had $61.8 million in assets, based on data collected as of the end of 2000.

Postal Federal Community Credit Un-ion now has several locations and about 13,500 members, according to Steve Pierson, president and chief executive officer.

Membership is open to postal and federal employees, and to anyone working or residing in a geographic area covering 10 counties in Southwest Missouri, Pier-son added.

"What we've seen is a trend toward credit unions being able to serve communities," he said.

Postal Federal Community Credit Un-ion was organized in 1929 to serve postal service employees and their families, Pierson said. It then expanded to take in federal employees and their families, military, retired military, and their families. "Throughout the years we've in-cluded various companies," he said. "Then a few years ago we added some counties."

These days, the primary difference with credit unions "is not who you can serve but how you can serve them," Pierson said. "Our structure is the major difference. We're a financial cooperative, so everyone who is a customer is an owner."

Profits

Although credit unions are not-for-profit organizations, Pierson said, "we do have to be profitable." Profits are directed back to the members in the form of lower interest rates on loans, higher interest on savings accounts, and lower fees. Also, because the purpose of a credit union is to serve its members, not to make the biggest possible profit, he said, "we'll do things that may not be profitable but we know it's a good service for members." For example, depending on the type of account they have, Postal Federal Community's members can get 12 free transactions per month at automated teller machines that don't belong to the credit union. "Our goal is to try to give as much back as we can to the members, and the rest goes into the reserves," said Pierson. "The reserves belong to all the members."

Making choices

"Like other corporations, our members elect a board of directors of fellow members," Wansing said of Southwest Tea-chers Credit Union. "They serve without pay, and attend board meetings on their own time."

Southwest Teachers Credit Union uses a mail ballot to give all members the option of voting each year.

"Everyone gets one vote, no matter the amount they have on deposit," he said.

TelComm's members also participate in a vote for a volunteer board of directors.

"We're an economic democracy. Each member has an equal ownership, with one vote," Ackerman said. "(Board members) volunteer their time because they agree with the philosophy of the credit union. We're people helping people."

He added, "People first' is the foundation for the involvement of credit unions in the community, and credit unions have endorsed that philosophy nationwide."

Generally, around 200 of TelComm's approximately 11,300 members attend the credit union's annual meeting, he said. "Through our newsletter, we en-courage all our members to participate. Every member has an opportunity to serve," Ackerman added.

In past years, Postal Federal Com-munity's elections were held at the annual meeting, which was often attended by around 250 to 300 members, Pierson said. "In an effort to have more members involved in the elections, we're doing a mail ballot this year," he said.

Postal Federal Community's membership usually grows about 2 to 3 percent each year, Pierson said. "We'd like to have more people take advantage of it," but it's difficult to get the word out without a large advertising budget, he said.

TelComm's growth has occurred mostly from word of mouth, Ackerman said. Some growth has occurred simply be-cause membership has opened up. Since the credit union previously could accept only members from its 125 employee groups, he said, anyone else who was interested had to be turned away.

"We've also been telling our members, If you enjoy being served by this credit union and like the services and advantages of it, let your neighbors, friends and relatives know,'" Ackerman said.

Wansing said that Southwest Teachers Credit Union offers an additional service to its members education.

"One of our goals is to educate members. We go out into the classroom and talk to students, we talk to teachers that get together, and we talk to the news media," he said. "We discourage credit card loans, and we encourage people to save up for their next major investment. We tell people it's important to save, because you never know when that next rainy day's going to happen."

(In the interest of full disclosure, Springfield Business Journal is a member company of TelComm Credit Union.)