What is a Credit Union?

Credit unions (“CUs”) have existed in the United States since the dawn of the 20 the Century, when St. Mary’s Bank opened in Manchester, New Hampshire in 1908. The model, imported from Quebec and continental Europe, centered on empowering depositors and giving them an ownership stake in their bank. These depositors became “members” of their banks and voted democratically on important issues such as electing directors. They sprung up organically to serve specific communities across the United States.

Modern CUs are governed by the National Credit Union Administration (“NCUA”), which operates in a similar manner to the Federal Deposit Insurance Corporation (“FDIC”), and/or by their respective state oversight agency. The NCUA insures deposits at CUs in a similar manner to how the FDIC insures deposits at commercial banks. CUs are non-profit entities and do not pay federal income tax. Typically, CUs serve a specific population segment such as teachers, residents of a particular geographic area, or even people with a common interest.

CUs tend to provide better interest rates to their members and make more responsible loans when compared to for-profit commercial banks. However, CUs today still operate largely the same way they did over a century ago. Some common issues with CUs include: the voting process being cumbersome and opaque, the loan application process being tedious and complicated, and the online user interface being clumsy and confusing. The big, for-profit commercial banks have been able to modernize more quickly by using their massive resources to build out their digital footprint and hire teams of lawyers to navigate uncertain regulations. Their for-profit status and lack of accountability to depositors give commercial banks leeway to reduce the interest rates offered to depositors to nearly zero.

‍From higher interest rates to a democratic governance model, CUs have a lot to offer prospective members. However, their frustrating user interfaces, opaque voting processes, and slow modernization efforts have given the edge to the for-profit commercial banks.

How Hive Finance Can Help

Enter Hive Finance. Hive Finance evens the playing field when deciding between a for-profit commercial bank and a CU by offering its customers the best of both worlds: a democratic finance platform where you can Be Your Own Bank.

Hive Finance is proud to offer a suite of initial products designed with our community in mind. These include individual or joint checking accounts and high-yield savings accounts – both with no fees. We also provide the option of having multiple goal-based savings accounts, allowing users to create

individual savings goals that roll up into a single account. Our free debit card completes the package, providing members with the convenience they need. But what truly sets Hive Finance apart from traditional banks is our fully transparent blockchain governance model. This groundbreaking approach empowers you, our members, to propose and vote on new banking products through a DAO-based membership. This means that you truly have a say in shaping your own financial experience. At Hive Finance, we believe that together, we can create a financial institution that not only listens to its customers but also adapts and grows with the ever-changing needs of our community. We invite you to join us in shaping the future of banking, by becoming a Hive Finance member and participating in our innovative community-driven platform.