Southeast Credit Union Management School (SRCUS) Year 1 Practice Test

Which statement about the primary purpose of a credit union is correct?

To Meet the Common Financial Needs of Its Members To Maximize Profits for Shareholders To Compete with Government Lenders To Issue Stock to the Public

Correct Answer:

To Meet the Common Financial Needs of Its Members

Explanation:

Credit unions are member-owned cooperatives built to meet the financial needs of their members. Their main purpose is to provide affordable financial services—savings, loans, and related products—that help members manage money and achieve financial stability. Since they operate on a not-for-profit basis, any earnings support member benefits rather than paying external shareholders. They do not issue stock to the public, which reinforces their focus on members rather than profit-maximization. The emphasis on serving members’ common financial needs makes this answer the best description of a credit union's purpose.

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