Common Bond (Credit Union Membership)
What Is a Common Bond?
A common bond is the shared connection that links members of a credit union and determines eligibility for membership. This connection may be based on employment, geographic location, association membership, or family relationships.
The common bond concept is a defining feature of credit unions and distinguishes them from traditional banks.
Why It Matters
Common bonds help credit unions maintain their cooperative identity and community focus. By serving members who share a connection, credit unions often create stronger relationships and tailor financial services to the needs of their members.
This structure supports the credit union mission of member service and financial inclusion.
How Common Bonds Work
Credit unions establish common bonds through their charter and field of membership.
Common types include:
- occupational bonds (employees of a company)
- community bonds (residents of a geographic area)
- association bonds (members of an organization)
- family bonds (relatives of members)
These connections define who is eligible to join the credit union.
Common Bond vs Field of Membership
- Common bond refers to the shared connection among members.
- Field of membership describes the full group of individuals eligible to join.
FAQs About Common Bonds
Why do credit unions require a common bond?
It preserves the cooperative structure and community focus of the institution.
Can a credit union have more than one common bond?
Yes, many credit unions serve multiple groups or communities.
Does the common bond affect financial services?
Not typically, but it determines eligibility to join.
Related Terms
