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Moving CAD and USD between banks
April 22, 2020
6:14 am
Heddie
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When life presents you with a controlled experiment it is logical to ask questions...

Just recently I moved funds between two online banks, both located in Canada: CAD to CAD and USD to USD. I noticed the CAD transfers were in the receiving account the next day and dated the same day as the initial transaction while the USD transfers were dated on the following business day. The time of day of the transaction was the same for both currencies and this same transfer was replicated a few days later with the same outcome.

Does anyone know why the transfer times are different? I wonder if there are two different systems in place to transfer these funds? What are the differences behind the scenes?

April 22, 2020
1:14 pm
cruzinalong
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Heddie said
When life presents you with a controlled experiment it is logical to ask questions...

Just recently I moved funds between two online banks, both located in Canada: CAD to CAD and USD to USD. I noticed the CAD transfers were in the receiving account the next day and dated the same day as the initial transaction while the USD transfers were dated on the following business day. The time of day of the transaction was the same for both currencies and this same transfer was replicated a few days later with the same outcome.

Does anyone know why the transfer times are different? I wonder if there are two different systems in place to transfer these funds? What are the differences behind the scenes?  

There are cutoff times for each transaction type. I know USD take 2 days to transfer CAD takes 1 day. When you PULL funds they are done the same day. The other bank does not process until one day later.

April 22, 2020
5:21 pm
Norman1
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Yes, there are two different systems run by Payments Canada.

The Canadian dollar funds transfers are done through the Retail System.

The US dollar fund transfers between Canadian banks are done through the US Dollar Bulk Exchange system. According to Rule K8, there is only one cutoff time each business day (9:30 am Eastern) that the US dollar automatic fund transfer files are exchanged by.

April 22, 2020
10:15 pm
Loonie
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These rules can, in a practical sense, only be guidelines because each FI takes its own sweet time about getting on with the transfer.

Meridian/motus are the worst, in my experience. It typically takes 4 business days to make the transfer if initiated there, and then there is an extended Hold period as well for pulls, so that the whole performance can take two weeks. And when they do finally clear, it typically shows up very late at night on my screen, so that it is effectively the next day.

April 23, 2020
6:53 am
cruzinalong
Ontario
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Loonie said
These rules can, in a practical sense, only be guidelines because each FI takes its own sweet time about getting on with the transfer.

Meridian/motus are the worst, in my experience. It typically takes 4 business days to make the transfer if initiated there, and then there is an extended Hold period as well for pulls, so that the whole performance can take two weeks. And when they do finally clear, it typically shows up very late at night on my screen, so that it is effectively the next day.  

I know about holds. They were irritating when you wanted to do something with the cash. Better to PUSH funds. Some PULL transfers I have $5,000 and $10,000 limits.

April 23, 2020
12:26 pm
Norman1
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The Payment Canada rules govern the part of the transfer after the transfer is entered it into one of the clearing systems.

How much time passes until the requested transfer is actually entered into a Payment Canada system is up to the originating financial institution. Some are quite quick and the funds can end up posted in the receiving account by dinner time the same day.

April 23, 2020
12:56 pm
Loonie
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cruzinalong said

I know about holds. They were irritating when you wanted to do something with the cash. Better to PUSH funds. Some PULL transfers I have $5,000 and $10,000 limits.  

I am aware that pushes are faster, but not all of my accounts allow them.
One of these days I will just get rid of my Big Bank accounts, but it requires a fair bit of reorganization.

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