Krediidiühistu

Krediidiühistu is the Estonian term for a credit union, a type of financial cooperative owned and controlled by its members. It operates on the principle that members benefit from the institution’s services rather than external shareholders. Members typically share a common bond, such as residence, employment, or association membership, and join on a voluntary basis.

Governance is democratic: each member usually has one vote, regardless of their savings size. Members elect a board of directors and a supervisory body at general meetings, and profits are reinvested in the cooperative or distributed to members as patronage bonuses. The primary aim is to provide affordable financial services to members rather than maximize profits. Credit unions emphasize local decision-making and personalized service.

Services offered often include savings and deposit accounts, consumer loans, and sometimes mortgages, payment services, and financial education. Interest rates and fees are generally designed to be favorable to members, with a focus on risk-aware lending and prudent lending practices. Credit unions may also provide online banking, ATM access, and other standard financial conveniences through cooperative networks.

In Estonia and many other countries, krediidiühistu operates under national financial regulation and supervision. They are typically subject to prudential requirements to protect member funds and to maintain financial stability. While smaller than large commercial banks, krediidiühistu play a role in local financial inclusion by offering accessible savings and credit to their members.