Which statement best explains why credit unions have potential for growth in membership?

Which statement best explains why credit unions have potential for growth in membership?

• A. They are large, global banks with many branches.
• B. They are non-profit organisations and do not have to pay shareholders, enabling cheap borrowing.
• C. They only serve people with excellent credit ratings.
• D. They are profit-driven to maximise returns for shareholders.

Answer: (B)

The main idea here is that the not-for-profit, member-owned structure of credit unions allows them to offer cheaper borrowing and better terms, which can attract more members and drive growth. Because they don’t have to pay dividends to shareholders, any earnings can be reinvested into services, lower loan rates, higher savings returns, or lower fees. This creates a strong value proposition for people seeking affordable credit and a community-focused option. As more members join, the cooperative model strengthens, expanding the appeal even further. The other statements don’t fit because credit unions are not large global banks with widespread branches, they don’t restrict membership to people with excellent credit, and they aren’t driven to maximise profits for shareholders.

The main idea here is that the not-for-profit, member-owned structure of credit unions allows them to offer cheaper borrowing and better terms, which can attract more members and drive growth. Because they don’t have to pay dividends to shareholders, any earnings can be reinvested into services, lower loan rates, higher savings returns, or lower fees. This creates a strong value proposition for people seeking affordable credit and a community-focused option. As more members join, the cooperative model strengthens, expanding the appeal even further. The other statements don’t fit because credit unions are not large global banks with widespread branches, they don’t restrict membership to people with excellent credit, and they aren’t driven to maximise profits for shareholders.