Why can a credit union pay more on deposits and charge less on loans?

1. A credit union is a not-for-profit cooperative owned by its members. 2. That not-for-profit status makes it tax exempt. 3. Being exempt from tax lowers its costs, so more of what it earns can be passed to members. 4. It can therefore pay good interest rates on deposits and offer loans at favourable interest rates. 5. The chain runs from ownership to tax status to pricing, and skipping the middle step is where the reasoning usually fails. 6. Deposits at credit unions are insured, so the claim that bank deposits alone are covered is simply false. _Source: OpenStax Introduction to Business (CC BY 4.0), Ch 15 "Understanding Money and Financial Institutions", section 15.3 U.S. Financial Institutions_