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Neo Financial
October 22, 2020
7:42 am
Peter
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I just stumbled upon Neo Financial: https://www.neofinancial.com/. It was apparently founded by the same people who started SkipTheDishes.

Among other things (including a credit card with 0% base rewards, but rewards at certain merchants), they claim to have a CDIC-insured 1.70% savings account, backed by Concentra Bank.

The FAQ (https://www.neofinancial.com/faq) says "Our interest rate isn’t temporary. By being a technology-first company without branches, we pass our savings onto you. That means there’s no 3 month promo period that you might typically see - just simply one of the best rates in Canada."

BUT, you cannot directly sign up yet. There is a wait list. When I submitted my email, it says there are 34,122 people ahead of me.

October 22, 2020
9:58 am
Bill
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Re CDIC coverage, from their site: "The Neo Savings account is provided by Concentra Bank, a CDIC member institution, and is eligible for CDIC deposit protection. Deposits held in Neo Savings accounts are combined with eligible deposits held at Concentra Bank, for up to $100,000 of deposit protection, per category, per depositor."

October 22, 2020
10:55 am
Londonguy
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Peter said
I just stumbled upon Neo Financial: https://www.neofinancial.com/. It was apparently founded by the same people who started SkipTheDishes.

Among other things (including a credit card with 0% base rewards, but rewards at certain merchants), they claim to have a CDIC-insured 1.70% savings account, backed by Concentra Bank.

The FAQ (https://www.neofinancial.com/faq) says "Our interest rate isn’t temporary. By being a technology-first company without branches, we pass our savings onto you. That means there’s no 3 month promo period that you might typically see - just simply one of the best rates in Canada."

BUT, you cannot directly sign up yet. There is a wait list. When I submitted my email, it says there are 34,122 people ahead of me.  

I just got in the queue -- 3 hours after your post and it's only up to 34,140

Strikes me as some kind of a cross between a Rakuten and a Brim and an online bank -- the fintech world just keeps evolving

October 22, 2020
11:53 am
Norman1
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It looks a MasterCard issuer, promoting a rebranded MasterCard from ATB Financial, with a deposit brokerage arrangement with Concentra Bank.

PC Financial would be that if it added back the CIBC deposit products it used to offer.

Not sure if Neo Financial is really being innovative or just years late to the game.

October 23, 2020
7:27 am
Nehpets
Ontario
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The rewards program, that appears to be associated with specific "partner" businesses at which the user must shop to qualify for the rewards, would currently be available only in Western Canada:

    Calgary
    Edmonton
    Winnipeg
    Vancouver
    Saskatoon
    Regina
    More coming soon

For the rest of us, if and when the 1.70% HISA becomes a reality, that might be the main and only attraction.

Stephen

October 23, 2020
10:02 am
Norman1
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I don't think the 1.70% rate for the Concentra Bank savings account will last.

Concentra Bank's current rate for one year to five year GIC's is 1.51%. Their rate for variable deposits is just 0.15%.

Neo Financial may even ditch the savings account. The Neo MasterCard looks like a credit card and, unlike the WealthSimple Visa card, is not a kind of prepaid card to spend the money in the savings account.

October 23, 2020
10:42 am
Nehpets
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Norman1 said
I don't think the 1.70% rate for the Concentra Bank savings account will last....  

Ya' but, from their FAQ:

The FAQ (https://www.neofinancial.com/faq) says "Our interest rate isn’t temporary. By being a technology-first company without branches, we pass our savings onto you. That means there’s no 3 month promo period that you might typically see - just simply one of the best rates in Canada."

Can you imagine a financial institution actually making such a claim and not following through? Say it ain't so!!

sf-surprisedsf-wink

Stephen

October 24, 2020
2:38 pm
Norman1
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Neo must have hired a newbie for marketing who doesn't know that someone else has pulled that kind of stuff already in January 2016:

Equitable Bank launches EQ Bank

"This is an exciting new chapter for Equitable Bank as we launch EQ Bank…," said Andrew Moor, President and CEO, Equitable Bank. "…. Without the cost of traditional branches, we can focus on our customers first, helping them achieve their savings goals faster."

The EQ Bank Savings Plus Account offers:

  • An everyday interest rate of 3.00% – with no teaser promo periods that have an expiry date

In April, monju00 reported that the non-teaser 3% rate was no more. Rate Whore had unkind words for EQ Bank.

October 25, 2020
8:21 am
Londonguy
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Norman1 said
Neo must have hired a newbie for marketing who doesn't know that someone else has pulled that kind of stuff already in January 2016:

Equitable Bank launches EQ Bank

"This is an exciting new chapter for Equitable Bank as we launch EQ Bank…," said Andrew Moor, President and CEO, Equitable Bank. "…. Without the cost of traditional branches, we can focus on our customers first, helping them achieve their savings goals faster."

The EQ Bank Savings Plus Account offers:

  • An everyday interest rate of 3.00% – with no teaser promo periods that have an expiry date

In April, monju00 reported that the non-teaser 3% rate was no more. Rate Whore had unkind words for EQ Bank.  

Maybe it's just me, but I don't mind being "teased" for 4-6 months or longer with an above-market rate. I similarly don't care whether they frame their offerings as temporary or promotional or not, that's just marketing BS.

I think of myself as a bee flitting from flower to flower, and when I find a fat juicy one, I'm happy to suck up as much nectar as possible while it's available before moving on to the next one

October 25, 2020
11:33 am
Doug
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Norman1 said
It looks a MasterCard issuer, promoting a rebranded MasterCard from ATB Financial, with a deposit brokerage arrangement with Concentra Bank.

PC Financial would be that if it added back the CIBC deposit products it used to offer.

Not sure if Neo Financial is really being innovative or just years late to the game.  

Yeah, I agree with you here mostly, Norman, though it's not similar to the President's Choice Bank/CIBC arrangement with PC Financial in that it was always CIBC employees directly servicing the accounts and selling the products. It doesn't seem to be like other prepaid credit card issuer fintechs, but I think your deposit brokerage arrangement sums it up well. At any rate, this won't qualify for inclusion in the comparison chart, per our inclusion criteria. It can be included in the "promos" and the HighInterestSavings.ca Cash Back site, too, where applicable.

Cheers,
Doug

October 25, 2020
12:09 pm
RetirEd
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Now, aside from not using online-only services, I would never patronize a business run by the SkipTheDishes folk or their ilk. They "disrupted" food delivery - usually provided free and the paid-employee delivery person getting a tip - and replaced it with a slimy parasitic business that:
1. Charges a delivery fee
2. Takes THIRTY PERCENT of the restaurant's bill!!!
3. Doesn't pay the drivers a salary or give them part of the delivery fee! They are not employees, but "contractors" (a la Amway) who get a small time/delivery fee, no benefits or pension and whatever tips they manage. And the company allocates deliveries to keep drivers' income very low.

Another race-to-the-bottom gig scam. May the devil take them!
RetirEd

Oh - and in case you haven't noticed, many restaurants have higher delivery prices than their regular menu to try to keep some profit. The others charge EVERYONE, delivery or dine-in, the extra for the parasites.

Slimeballs.

November 5, 2020
11:33 am
Londonguy
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Just a comment about what appears to be really going on with this Neo "get in the queue for our big opening" routine -- the referral process is a pyramid scheme.

I've been screencapping my status since I signed up, and I now have a few hundred more people in front of me than I did a week ago. I am literally moving backwards. That's because (supposedly) those few hundred people now in front of me provided referrals to Neo to improve their place in line. The overall message being, if I don't pony up referrals, I may never get to the front of the queue.

While I don't have a problem with the queue jumping concept and remain content to wait, a few minutes ago I got an unsolicited bully email from Neo urging me to refer some friends so as to not lose my place in line. Or, more properly stated, I'm being hustled to help Neo harvest legitimate email addresses of likely prospects. Well, Neo, that ain't gonna happen.

Talk about dangling a virtual carrot out in front of a bunch of naive millennial donkeys

November 5, 2020
5:49 pm
Shawguy
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I just got my Neo Mastercard in the mail yesterday, but I am still on the waiting list for the savings account

November 5, 2020
9:15 pm
Loonie
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They didn't say it was permanent, only "not temporary".

Could still be "fleeting", "here today and gone tomorrow", "suspended",
"momentary", "now you see it, now you don't", "subject to market conditions" or "rate? what rate? did someone say rate?"sf-wink

November 19, 2020
12:41 pm
Peter
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I downloaded the Neo Financial app, since the website directs all CTA buttons to the app. It lets you enter all of your information to apply for an "account" (including taking your picture), but at the end, you'll find that you cannot open a savings account without getting the credit card. And then you'll get several follow-up emails encouraging you to complete the steps to get the credit card.

So, you cannot open the savings account on its own yet. On social media, they said that will be possible "in the coming months":

November 19, 2020
1:52 pm
Norman1
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That's not surprising as the savings account is not where the income will be from for Neo Financial. The customary deposit brokerage commission is just ¼% per annum.

In contrast, a slice of the MasterCard interchange, 0.87% to 0.92% for electronic card-is-present spending, would be much more.

What could even be more is the markup charged to the select merchants for the cashback rewards. Cardholder may receive 15% cashback, but the merchant could be charged 30% for that 15% cashback. sf-surprised

AIR MILES used to charge merchants around $0.27 for each mile awarded. To the collector, each AIR MILE is worth about $10 / 95 = $0.105.

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