Low-Cost Small Dollar Loans Available Through Credit Unions

Credit Union Better Choice Saves Consumers More Than $23 Million Dollars

HARRISBURG, PA —Since launching in 2006, more than 64,000 Credit Union Better Choice loans have been issued to credit union members for short-term cash needs. Through the 72 participating credit unions across the Commonwealth, 64,930 loans were issued totaling more than $32 million dollars since the program’s inception. More importantly, the program has saved borrowers more than $23 million dollars over using a traditional payday lending product. This continued growth in the Credit Union Better Choice program, the credit union alternative to payday loans, indicates that consumers still are in need of small dollar loans.

The Credit Union Better Choice loan is a payday lending alternative product where credit unions offer borrowers a 90-day loan with a $500 limit. Reasons cited for loan purpose have included Christmas gifts, taxes, car repairs, heating fuel, and funeral expenses. The Credit Union Better Choice was developed through a collaboration of the Pennsylvania Credit Union Association (PCUA), Pennsylvania Treasury Department, and the Pennsylvania Department of Banking and Securities.

Currently, 72 credit unions with 206 locations offer Credit Union Better Choice loans across the Commonwealth of Pennsylvania. In the six-month cycle (July 1 – December 31) of 2012, 6,044 loans totaling $3.9 million dollars were issued. Furthermore, borrowers also placed more than $385,000 into savings accounts during the six-month period.

The Credit Union Better Choice program is offered through participating credit unions. To learn more about the program and a view a list of participants, visit To find a credit union to join, visit”

“I’m pleased that credit unions continue to provide their members with short-term loans to meet member needs,” said PCUA President/CEO Jim McCormack. “I encourage Pennsylvanians who are not using a credit union to consider switching to one for all of their financial services.”

A typical $500 payday loan costs consumers $15 for every $100 borrowed for two weeks, or approximately $450 over 90 days. A $500 Credit Union Better Choice loan costs consumers approximately $42.50 for the same 90 days and at the end of the loan term, the consumer has $50 in a savings account, which allows them to begin to develop a savings habit. In addition, the program builds upon this new wealth-building component by providing financial education to consumers in an effort to help them make better informed financial decisions.

Pennsylvania consumers saved an average of 80 cents in loan fees and costs for every dollar borrowed through a Credit Union Better Choice loan rather than through a typical loan from a payday lender. This translates into more than $23 million dollars that consumers kept in their own pockets by using credit unions that offer Credit Union Better Choice loans.


Total Number of Loans Issued

Total $ Amount of Loans Issued

Total $ Amount of Consumer Savings vs. Payday Lender

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Credit unions are financial cooperatives that provide affordable financial services to help their owner/members. The Harrisburg-based Pennsylvania Credit Union Association is a trade association that provides legislative, promotional, educational, and operational support for more than 400 credit unions in Pennsylvania. These credit unions have assets in excess of $37 billion and serve more than 3.7 million members. For additional information about credit unions or to find a credit union near you, visit

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