Member Ownership shares
Credit unions operate using the co-operative business model rather than the competitive business model practiced by banks. There are many differences between credit unions and banks, not only in the way they do business but also in the underpinnings of their philosophy. Credit unions seek to maximize benefit using cooperative principles in keeping with a Vision or Mission Statement.
All financial institutions are required to maintain certain levels of capital as determined by-law and enforced by their regulators (FSRA - The Financial Service Regulatory Authority of Ontario) in the case of Ontario credit unions).
The credit union model involves "membership". In order to be a member of a credit union, you must become an owner.
At KCCU, our current by-laws as of May 1, 2017 require all persons over the age of 21 to have 5 shares at $5 each ($25) to be a member. Members under age 21 may have one share ($5). This membership share forms part of the credit union's capital in addition to previous year's undivided earnings. In each of the past thirty years, KCCU has paid a minimum of 3% dividend on these member shares. If you close your account with KCCU the shares are returned to you. The dividends from those shares are yours to keep and are paid annually as determined at the AGM. You may deposit up to $1,000 in excess of your minimum member share requirement, but these shares may only be withdrawn when you close your membership.