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Is moving your money a privilege?
May 27, 2021
6:57 pm
KamWest
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I have accounts at dozens of financial institutions and sometimes wonder if moving my money is considered a privilege at some of these places.

I am basically talking about e-Transfers and how some institutions still charge for them. Example meridian has 3 free if you keep a minimum of 1k in your account. Other than that they are $1.50 which basically means none are free because you have to keep 1k in the account.

Nova Scotia labels the ones they give you in big block letters FREE E-TRANSFER as if it is a privilege to move my funds.

So in this topic I wish to have a hall of shame for all financial institutions that charge or put a limit on the amount of free e-transfers you can sent.

My pick to start...

Meridian Credit Union - all accounts are e-transfer restricted to 3 free and they are immediately billed and credited back at month end if all conditions are met.

Who wants to go next?

PS. My goal here is to shame the banks and to make them keep our interac system not for profit. E-Transfers should be free for everyone, it runs on a not for profit system and it is time we hold the banks to task.

May 27, 2021
7:12 pm
savemoresaveoften
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I dont understand why it should be free ?
It provides a service, charge a convenience fee for it, I dont see anything wrong with it.
Will you work for free if your boss ask you ?

May 27, 2021
7:51 pm
PubMob
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Absolutely should be free.
Fi's:
Charge monthly package fees
Make money off or your deposits of all types
Transactions fees are costing them cents vs the old days of manual clearing.
You are being gouged every day by a bank and they are continuing to come up with more fees and less service.

A privilege to move..definitely not. Don't let them baffle you.

May 27, 2021
8:37 pm
Norman1
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KamWest said

PS. My goal here is to shame the banks and to make them keep our interac system not for profit. E-Transfers should be free for everyone, it runs on a not for profit system and it is time we hold the banks to task.

That's doubly false.

Non-profit Interac Association did not develop Interac e-Transfer. It was developed by for-profit Acxsys Corporation.

Interac Association is gone. In February 2018, it was amalgamated with Acxsys and both continued as for-profit Interac Corporation. Interac Association and Acxsys Corporation join to form Interac Corp.

Interac e-Transfers have always been for-profit.

As well, the non-profit nature of the Interac Association was only for its financial institution members. It was not non-profit to outsiders, like consumers and businesses.

May 28, 2021
1:16 am
Loonie
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Whether it's run by a for-profit corp or not pales in the context of the situation in which fees are charged to account holders.

I rarely use it (maybe once or twice a year), so it doesn't matter to me personally, and I have accounts where it is free, so I really don't care, personally.

However, in the broader contest, I think it depends on the entire banking set-up with that particular FI. I would look at what that particular FI is costing me annually, both in fees and lost interest, and see what that picture gives me before deciding if a fee might be justified at some FIs. If the FI is paying a fee to a third party for this service, then it's reasonable that they charge for it, but it may not be reasonable in the context of other fees and losses experienced by the customer.

Personally, I am in favour of no-fee banking. I expect the FI to consider its costs when it offers me an interest rate and not to continue to ding me for everyday activities. I don't keep my money at the ones that don't meet this standard unless there is some compelling reason to do so.

I think but am not sure that AltaRed told us a while ago that the banks in general want to get rid of cash. I would say that if they don't want to deal with cash, then they need to offer e-transfers for free.
However, if you are doing 40 or 100 a month, there may be some legitimate limits put in place.

If you want to change their behaviour, I don't think shaming will work. I think it would be more useful to list the ones that don't charge a fee. Use the carrot, not the stick. Show them you can do better elsewhere. Then dump some of your dozens of accounts that displease you. Decluttering will be better for those that remain.

May 28, 2021
7:40 am
AltaRed
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Loonie said
I think but am not sure that AltaRed told us a while ago that the banks in general want to get rid of cash. I would say that if they don't want to deal with cash, then they need to offer e-transfers for free.   

My prior comments were regarding the elimination of cash at teller stations at least for personal* banking. With ATMs and other forms of digital payment, use of cash is declining and there is no need to get it from a teller station.

I am a bit agnostic about charges for e-transfers. I see it as a replacement for cheque writing primarily on a person-to-person basis and it is way more efficient for FIs to deal with e-transfers than cheques. FIs could/should start charging for cheques (maybe after 1-2 freebies a month) and charge less, or less frequently, for e-transfers. If I can't use a credit or debit card, I try to use e-transfer exclusively with trades people, personal gifts, kijiji, etc.

The primary downside I see with e-transfer are the limitations in transaction values, both on a singular, daily and weekly basis. The other downside is digital interception but that is minimized with autodeposit and with robust email passwords. With the 3-4 FIs I can use e-transfers with, only 2 have limitations on number of freebies (10 I think) per month.

My view is banks should charge for services that involve human involvement, and/or for those that they incur more than mere cents in processing fees themselves. How they do that, e.g. minimum monthly balances, account fees, is up to them. They are not charities and their shareholders wouldn't be pleased.

* Most businesses still cannot do without cash for the most part so there still is a need there.

May 28, 2021
8:12 am
savemoresaveoften
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AltaRed said

My prior comments were regarding the elimination of cash at teller stations at least for personal* banking. With ATMs and other forms of digital payment, use of cash is declining and there is no need to get it from a teller station.

I am a bit agnostic about charges for e-transfers. I see it as a replacement for cheque writing primarily on a person-to-person basis and it is way more efficient for FIs to deal with e-transfers than cheques. FIs could/should start charging for cheques (maybe after 1-2 freebies a month) and charge less, or less frequently, for e-transfers. If I can't use a credit or debit card, I try to use e-transfer exclusively with trades people, personal gifts, kijiji, etc.

The primary downside I see with e-transfer are the limitations in transaction values, both on a singular, daily and weekly basis. The other downside is digital interception but that is minimized with autodeposit and with robust email passwords. With the 3-4 FIs I can use e-transfers with, only 2 have limitations on number of freebies (10 I think) per month.

My view is banks should charge for services that involve human involvement, and/or for those that they incur more than mere cents in processing fees themselves. How they do that, e.g. minimum monthly balances, account fees, is up to them. They are not charities and their shareholders wouldn't be pleased.

* Most businesses still cannot do without cash for the most part so there still is a need there.  

What you said about charging for services that require manual process makes a lot of sense, but then some will argue that should be free too. I can see the older generations that still go to banks for their transactions are the one that does not use etransfer, so to them charging etransfer is "fair", charging personal transactions is "wrong".

There is no 1 size fit all solution, which is why different banks already have different account tiers with diff bundled services. Just pick the FI and account type that suits one's need, as oppose to making the easy whining "it should be free".....

This site is free for users and its great. Appreciate the admin doing all the hard work !

May 28, 2021
8:39 am
Alexandre
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AltaRed said

My view is banks should charge for services that involve human involvement, and/or for those that they incur more than mere cents in processing fees themselves.

Be careful what you wish for. A single phone call from a client to bank could cost bank as much as $10-$15, or more.

So, imagine calling Tangerine for bonus interest rate, getting "no bonus for you!" answer and getting charged $10 for that phone call.

I think Tangerine would not mind, but us folks would.

May 28, 2021
11:07 am
AltaRed
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Easy. Stop the interest rate promo game and there is no reason to call an FI at all, except maybe as a follow up to an online Secure Chat or Secure Message. Once an account is open and functioning, and any glitches ironed out. there should be no need for ongoing verbal communication.

I have not called a bank in many years on any banking related matters and have stepped into a bank only once to deposit a USD cheque into a USD bank account. There will be more dramatic changes coming in the next 5-10 years. A new Canada payments system in 2022, perhaps Open Banking by 2025 (though that is a stretch), etc. that will transform banking as we know it.

That all said, I do recognize some older folks (mostly pre-Boomers born before 1946 with the youngest now 75) that still bank in the 20th century. StatsCan says that as of July 1, 2020, there were 2.9 million Canadians aged 75 and older. In 5 years, the numbers of pre-Boomers who will then all be 80 yrs of age or older will have shrunk by perhaps a third.

I don't personally know of any Boomer (currently <76 years old) that is not online/digital savvy and for that matter no one under 80 that is not digitally savvy, meaning Internet, online banking, ATMs, etc. Basically, almost anyone under the age of 60 in the year 2000 had to become online savvy and that is where we now stand.

I recognize this is getting off the topic of the original post but there will likely be dramatic changes in the next 5-10 years completely changing the banking landscape. None of this is standing still for long.

May 28, 2021
6:29 pm
Norman1
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Loonie said

If you want to change their behaviour, I don't think shaming will work. I think it would be more useful to list the ones that don't charge a fee. Use the carrot, not the stick. Show them you can do better elsewhere. Then dump some of your dozens of accounts that displease you. Decluttering will be better for those that remain.

Showing them will be futile. Meridian CU and other financial institutions likely know about the competition.

Hubert's parent Sunova CU is also stingy on Interac e-Transfers. $7.90/month covers 30 transactions but only two Interac e-Transfers. $11.90/month covers 60 transactions but only four Interac e-Transfers. One needs to pay $14.90/month or have a $10,000 minimum monthly balance to have unlimited transactions and unlimited Interac e-Transfers.

Just dump them and go elsewhere like the "shocked and dismayed" woman at the start of CBC Go Public: Ottawa questioned as anger over bank fee increase grows.

May 28, 2021
7:53 pm
Norman1
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savemoresaveoften said

What you said about charging for services that require manual process makes a lot of sense, but then some will argue that should be free too. I can see the older generations that still go to banks for their transactions are the one that does not use etransfer, so to them charging etransfer is "fair", charging personal transactions is "wrong".

Neither is really free. One is made free by tacking its cost onto something else that is not free.

One can see that past that cross subsidization by looking at the services fees of business bank accounts which are more transparent. If one walks into the branch and does a deposit into a business account, the deposit could cost $2.50. That's just for the deposit!

There may be an additional 22¢ fee for clearing each cheque in the deposit and an additional $2 per $1,000 for handling the cash in the deposit.

Depositing four cheques and up to $1,000 of cash together at the end of each month would cost $2.50 + 4 x $0.22 +$2 = $5.38!

If one likes to talk with the cute teller and doesn't save it all for one deposit, then it will cost 4 x ($2.50 + $0.22) + ($2.50 + $2.00) = $15.38.

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