We value our editorial independence, basing our comparison results, content and reviews on objective analysis without bias. But we may receive compensation when you click links on our site. Learn more about how we make money from our partners.
Credit union credit cards (2019 guide): How they work, best cards
Find low fees and interest rates — and in some cases, powerful rewards.
Credit union credit cards are issued by member-owned financial institutions. That can be great news, as nonprofit credit unions help their members save through lower fees and interest rates.
Credit unions can pack a punch too, offering rewards cards that give big banks a run for their money.
Compare credit union credit cards
What are credit union credit cards?
These cards are issued by credit unions instead of banks. They also tend to have lower fees and interest rates than you’ll find at larger financial institutions.
To get a credit union credit card, you need to become a member of the credit union, which usually involves a fee of around $5 to $25. You may also need to open a savings account before or during your application.
What is a credit union?
A credit union is a financial institution that’s owned by its members. It’s a nonprofit, serving its members rather than seeking to generate profit for shareholders. This is why you’ll often find higher savings when using a credit union.
Once you’re a member, you’ll also have the opportunity to influence how the credit union is run. For example, you may be able to vote at annual general meetings or provide feedback that influences the features of different products.
Benefits and disadvantages of credit union credit cards
- Competitive ongoing interest rates
- Lower annual fees
- Same interest rate for purchases and cash advances
- Personalized service
- You have to meet membership eligibility requirements
- Limited reward options
- Limited balance transfer options
- Less competitive introductory offers
The best credit union credit cards of 2019
Best for travel: PenFed Pathfinder Rewards American Express® Card
Best for cash back (high spending): Alliant Cashback Visa® Signature Credit Card
Best for cash back (low to moderate spending): PenFed Power Cash Rewards Visa Signature® Card
Best for gas and groceries: PenFed Platinum Rewards Visa Signature® Card
Best for low interest (variable): Lake Michigan Credit Union Prime Platinum Visa Credit Card
Best for low interest (fixed): Cencap Federal Credit Union Visa credit card
Best for rebuilding credit: SDFCU Savings Secured Visa Platinum Card
How we chose our best cards
We gave heavy weight to cards with the best rewards rates in their categories. When contenders were relatively even, we chose cards with additional standout features — benefits one usually wouldn’t expect in similar products.
How to compare credit union credit cards
Include the following factors in your comparison to find the right credit union for you:
Standard interest rates.
Credit union credit cards tend to have lower standard purchase rates than bank options. Some credit union cards also apply the same interest rate to both purchases and cash advances rather than having a separate and higher cash advance rate.
Promotional interest rates.
As credit union credit cards typically offer low ongoing interest rates, the promotional rate offers may be more conservative.
Some credit union credit cards don’t offer balance transfers. The cards that do provide this service are less likely to have a 0% interest rate during the introductory period when compared to cards from banks. However, credit union credit cards usually have a lower ongoing interest rate than typical credit cards.
Most credit union credit cards have low annual fees. There are also some credit union credit cards that don’t charge an annual fee.
If you pay your balance in full by the statement due date each month, you could get up to a certain number of interest-free days for each statement period. This feature is available with both credit union and bank credit cards.
Credit unions offer fewer rewards credit cards than banks. You’ll still find a few options that offer points for purchases made on your account, though.
The most common fees include international transaction charges, late payment fees and cash advance fees.
In general, only gold or platinum credit union credit cards will offer complimentary extras such as travel insurance or concierge services.
Credit unions may have a more limited branch network when compared to larger financial institutions.
What’s right for me? Credit unions or banks?
|Focus||Provide better member experiences and improve their financial situation with quality products and suitable advice.||Maximize profits for their shareholders, so they can attract more investors.|
|Profit||Goes back into the system to provide its members with competitive rates and offerings.||Goes to its shareholders. The bank might invest some of it in different kinds of financial products.|
|Security||Credit unions offer Mastercard and Visa credit cards, both of which provide secure payment systems and protection against fraudulent electronic transactions.||Banks offer the same security measures.|
|Rewards||Credit unions provide credit cards linked to a limited amount of major rewards programs.||Banks offer a range of rewards credit cards as well.|
|Other benefits||You have a say on how the credit union is run as a member.||Banks also offer added features through their credit cards, but you might have to pay higher annual fees in this case.|
Now that you know more about the different structure and focus of credit unions, you can compare these cards with the larger financial institutions to find one that suits all of your needs.
For more options, check out our guide to the best credit cards of 2019.
Frequently asked questions
Pictures: Getty Images
Ask an Expert