Industry Canada and the Financial Consumer Agency of Canada release annual report on banking service charges and consumer guide

Industry Canada’s Office of Consumer Affairs and the Financial Consumer Agency of Canada today released complementary reports: The Cost of Banking — Annual Report 2002 and a Consumer’s Guide to Basic Banking Services.

The Cost of Banking — Annual Report 2002 provides Canadians with objective information on the fees charged by Canadian banks and other deposit- taking institutions in 2001 for banking services. It also identifies which institutions’ charges increased and which decreased during the year.

According to the report, there were significant changes at some institutions where electronic banking has become more expensive and some in-branch banking has become less expensive. The report provides details on fee increases and new fees charged for the use of automated banking machines (ABMs).

“This report will help Canadian consumers choose the banking service charge package that best suits their individual needs,” said Michael Jenkin, director general of the Office of Consumer Affairs. “Industry Canada’s Financial Service Charges Calculator, available at http://consumer.ic.gc.ca, enables consumers to compare over 120 packages from 14 institutions.”

The Consumer’s Guide to Basic Banking Services, produced by the Financial Consumer Agency of Canada, provides plain-language information to help consumers understand the costs associated with banking. It focuses specifically on low-fee accounts, as well as on accounts for youth, seniors and students. The Consumer’s Guide includes a feature on “white-label” automated banking machines and point-of-sale terminals, and illustrates the potential benefits of maintaining a minimum monthly balance. It also provides a financial checklist and a worksheet consumers can use to help them track their banking behaviour.

“The greater variety of low-fee accounts is good news for consumers who like to do some in-branch banking at their own financial institution,” said Financial Consumer Agency of Canada Commissioner Bill Knight.

“Some financial institutions,” said Commissioner Knight, “have begun to add ‘convenience’ surcharges for non-clients using their off-premise automated banking machines.”

In 2001, a white-label operator began a pilot-project to install point-of- sale terminals where consumers have to pay a convenience fee when making debit card purchases.

“Consumers should keep track of their banking habits and become aware of all the fees they are paying, so they can ask the right questions and get the right banking package for their needs,” advised Knight. “They can minimize their banking costs by using an ABM operated by their own financial institution.”