Slightly
heated, crusty, and ready to pop -- is this how banks like their
customers? |
When
it comes to the latest score in the contest between the cops and
the robbers, Detective Mike Earl of Toronto's holdup squad says,
"We're getting clobbered. In the last two months alone there
have been 71 bank robberies."
Or
maybe they're just disgruntled customers.
In
days gone by, every bank transaction was performed by a teller.
This teller would write numbers into a ledger. From here, the numbers
were transcribed into another ledger, and probably to another after
that. Papers were shuffled, people walked around, and ink was spilled.
For this labour-intesive service, the customer was charged a minimal
fee and sometimes even given a toaster.
Today,
through the wonders of electronics, the customer can withdraw money,
automatically debit the amount, transfer funds, and even pay bills
-- all without involving a single bank employee. The customer's
reward is a service charge anywhere from forty cents to $1.25 or
more per transaction.
And
nobody gets toasters any more.
Simple
Clear Choices ("No Longer Offered")
Because
service fees have risen so high, banks now offer numerous special
accounts.
The
Royal Bank's "Pricing Options That Give You More Control Over
Service Fees" offers a clear chart showing the various options
on fees for using the Automated Banking Services — such as
Royal Bank Banking machines and Interac Direct Payment purchases.
In the left-hand column are options and in the right, fees. These
fees range from thirty cents to $2.95, but a couple of options are
accompanied by the word "Free" spelled out in large, flowing
script. For instance, there is no charge for Royal Bank Banking
Machine withdrawals if you you have a Bankbook Chequing account.
Unfortunately, a tiny smudge next to the entry turns out, upon closer
examination (with a magnifying glass) to be a superscript 3.
In
the tiny-print endnotes it turns out that "3" means "this
account is no longer offered."
Get
the picture?.
The
"CIBC's Service Fees Clear & Simple" brochure explains
their fees very clearly and very simply. All fees are sixty cents,
but, with CIBC Rewards you can save 25%. These Rewards come in three
different options: a 10-pack, 20-pack and a 30-pack.
Here's
how it works. If you buy a 10-pack option at $4.00 a month you get
ten transactions at a 25% reduction. A 20-pack option gives you
20 reduced transactions for $8.00, and the 30-pack gives 30 for
$12.00. In each case, all transactions past the preordained limit
are charged at the regular price of sixty cents. You can also take
out these points either in interest, or Club Z points. (No, I didn't
just make that up.)
Student
Accounts
Rather
than continuing with all the options from these banks, let us instead
concentrate just on the various Student Accounts which are probably
the accounts of most interest to UofT students.
CIBC
The
CIBC Student option is a straight-across 50% reduction on the fees
of whatever account you may have. This means that if you choose
the 10-pack option (for $4.00 a month) then your 25% reduction on
their regular sixty cent transaction fees is further reduced by
50% to twenty three cents. As far as I could discover, there is
no monthly fee for this account, you need merely be a student in
a post-secondary institution.
Scotiabank
For
$1.00 a month, the Scotiabank Student Account allows eight free
non-teller transactions which include any Scotiabank ABM, Internet
or phone banking. Anything beyond this is reduced by 50% of the
regular fee.
Royal
Bank
The
Royal Bank offers a special Student Price Card Symbol that provides
discounts of between 10-25% on purchases from 1,500 stores. The
first 25 self-service transactions are free, after this you pay
regular price which is fifty cents. You are also allowed two free
full-service transactions (that's where you actually get to talk
to a teller), and for each payroll you have deposited directly into
the bank you get another free full-service transaction. The monthly
fee for all this is $3.50.
Bank
of Montreal
Like
the Royal Bank, the Bank of Montreal gives students 25 free self-service
transactions. It also offers two free transactions from ABMs belonging
to other banks. If there is a monthly charge for this it is very
cleverly hidden.
Toronto
Dominion Bank
The
TD bank charges $2.50 a month for its Student plan, plus $1.00 for
"maintenance fees." For this you get unlimited free access
to TD ABMs and unlimited free direct payment, such as going to a
grocery store and paying with your card. It also allows two free
transactions on other ABMs per month.
In
several of the options, Internet banking and phone banking are listed
as "free." This, of course, doesn't mean that they are
actually free but that there is no monthly charge merely for the
privilege of being connected (normally this is in the neighbourhood
of $5.00). Each transaction, however, still costs money, although
sometimes they allow you to make several transactions at once while
paying for only one. The one exception, as far as I can tell, is
the Bank of Montreal which not only doesn't charge students a monthly
connection fee, but also waives the fees on bills paid through Telephone
Banking Service or NetBanking.
Your
Duty As A Customer
Naturally
you should never make a financial decision based upon something
you read in a newspaper — even a newspaper as obviously superior
and intelligent as The Strand. Before making any move,
pick up the literature yourself, look through it carefully and be
sure to follow all the little footnotes. Furthermore, you should
become well acquainted with all the terms, many of which change
from bank to bank.
Remember,
it is not only your duty to do the work of the bank, but also to
educate yourself in complex financial matters.
After
all, isn't that what you're paying them for?
Reprinted
from The Strand, Oct. 7, 1998
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