Why and How to Choose a Locally-Owned Bank or Credit Union
Note: The term CFI (community financial institution) is used throughout this page to include both community banks and credit unions.
Moving your money to a locally-owned bank or credit union is rarely a sacrifice. In fact, most people and businesses will save money by going local! Shifting personal, business and institutional bank accounts (including your town’s or city’s) to local CFIs is one key way to:
- Build wealth locally instead of exporting it to Wall St.
- Expand opportunities for local entrepreneurs and create more local jobs (see 2nd graph below)
- Keep decision-making power in your community. When absentee-owned corporations have your money, they wield unaccountable power over you and your community.
We hope the resources below help you learn about the ownership and practices of the banks in your area and instigate shifts in your community. Also, if you have loans or credit cards, consider that using a local CFI is equally important for these transactions. In addition to accepting deposits, your community banks and credit unions are must be able to loan out those funds to sustain its services! And just like bank accounts, you’ll often find CFIs offer better loan and credit card terms.
How to Assess Your Options Before Choosing Where to Bank
Bank Local is an online database lets you easily look up the banks with branches in your area and see their performance on values such as local ownership, community reinvestment, small business support and more. Highly recommended!
The Federal Deposit Insurance Corporation (FDIC) provides a simple online tool to learn the market share of banks in your area. This allows you to track shifts in your area over time, which will yield valuable data for “Move Your Money” campaigns.
Charts and graphs on the state of the banking industry and benefits of banking locally from the Institute for Local Self-Reliance.
FDIC Community Banking Study is a data-driven effort to identify and explore issues and questions about community banks.
Trade Groups Representing Credit Unions and Community Banks
Independent Community Bankers of America and their Too Big to Fail page highlight why a less concentrated and more diverse financial system will decrease systemic risk, improve competition and innovation, and increase the availability of consumer credit.
Community Development Bankers Association Community development banks focus on providing credit to low- and moderate-income communities.
National Federation of Community Development Credit Unions CDCUs specialize in serving populations with limited access to safe financial services, including low-income wage earners, recent immigrants, and people with disabilities.
Minority-Owned Banks and Credit Unions
We welcome anyone involved in “Bank Black” campaigns to make use of these resources and will gladly help where possible, including customizing graphics. The Federal Reserve maintains a list of minority-owned depository institutions and several parties have created lists of black-owned banks.
Be aware that many lists of black-owned banks do not distinguish between various ownership models. A bank with publicly-traded stock may be majority black-owned, but anyone can buy stock, so ownership and control may change over time. We also encourage everyone to consider the value of local control. At least one bank heavily promoting “Bank Black,” One United Bank, is a nationwide operation that boasts of acquiring community banks from coast to coast as its growth strategy.
We encourage you to use Bank Local.info to identify CFIs near you and see how they rate on criteria most important to you.
Articles and Tools
We Were Wrong About Universal Banking, John Reed (former Citibank CEO), 2015
One in Four Local Banks Has Vanished Since 2008. Why?, Stacy Mitchell, 2015
Community Banks Punch Above Their Weight, Terry Jorde, 2014
Small Banks Providing Better Rates, Gaining Young Customers, Jeff Milchen, 2015
Cash mobs provide a great opportunity to engage local banks.
Money stamps are an effective and low-cost way to circulate the pro-local message community-wide.
Don’t Just Move Your Own Money! Beyond moving your own loans, credit cards or accounts, you can build powerful alliances by helping shift the bank accounts of your city, schools or other local institutions! See
Beyond Banking: Community Investment
Michael Shuman, author of the “Local Dollars, Local Sense” and more, led an AMIBA webinar on driving local investment (affiliates can log in, then access recording here.) Locavesting, provides a wealth of news and resources about diverting investment from Wall Street to your Main Street. Please contact us with any questions or ideas to improve this collection. Finally, we seek to share stories about people’s experience in moving from a megabank to a CDFI — let us know if you had any experiences to share!