Although the two big banks offering the new registered disability savings plan are using very different marketing strategies to promote the product, they share a common vision: helping the disabled save for the future while scooping up new business.

By helping customers who have been turned away by financial services institutions that don’t offer the RDSP, Royal Bank of Canada and Bank of Montreal have a prime opportunity in this market downturn. As the clock ticks toward the RDSP’s 2008 contribution deadline of March 2, both banks will have the chance to pick up other accounts from their new clients, including RRSPs, RESPs and TFSAs.

The RDSP has already been attracting new clients to BMO, says David Sharone, product manager of registered plans with BMO Mutual Funds Inc. in Toronto. Several clients have been so appreciative that BMO was the first financial services institution in Canada to offer the RDSP that they brought other assets to BMO, Sharone says.

BMO is centralizing its RDSP account creation at call centres. Although this may be an efficient model for the short term, it could hurt the growth of BMO’s program in the long term.

In comparison, RBC clients can walk into any bank branch and set up an RDSP with one the bank’s 2,000 branch-based financial advisors, says David Birkbeck, head of registered products for RBC in Toronto. “This plan is quite complicated,” he says, “and people really need some advice, to sit down with somebody to talk about how the plan works, what the eligibility requirements are, what kind of things should they be thinking about in their specific, unique circumstances. We think it lends itself to a face-to-face meeting.”

Birkbeck recommends that clients meet with an advi-sor in an RBC branch; RBC is not offering the RDSP through its investment advisors at investment dealer RBC Dominion Securities Inc.

Clients of BMO’s brokerage, BMO Nesbitt Burns Inc. , are directed to use BMO’s RDSP call centre, while non-BMO clients must first open an account at a branch, then call a toll-free number to open an RDSP.

Neither BMO’s nor RBC’s RDSPs have a “self-directed” option, which would allow clients to hold any mutual fund or product. Funds and guaranteed investment certificates held in both banks’ plans are restricted in that they must be the pertinent banks’ products. On the upside, the RDSP carries no annual administration fee at either bank.

BMO first announced in December 2008 that it will offer the RDSP through its call centre; six weeks later, BMO said it would add new staff to accommodate higher than expected demand. By February, more than 3,000 families had opened a BMO RDSP account.

That number is expected to increase as more people learn about the RDSP. But, for now, the greatest obstacle to the product’s growth at both banks is the lack of awareness about the program among people with disabilities. Knowledge of the program is slowly growing, but only a small fraction of the potential market has been tapped.

To raise awareness, RBC is working closely with the Planned Lifetime Advocacy Network, a Vancouver-based non-profit, non-government-funded charity and advocacy organization set up to help families caring for loved ones with disabilities. PLAN, which had long campaigned for the creation of the RDSP, will continue to work to educate Canadians about the program.

There is no consensus on the potential market for the RDSP, but Sharone estimates it is about 180,000 to 200,000 people, based on those who are eligible to participate in the plan by virtue of both being under the age of 50 and having claimed the disability tax credit on a federal tax return.

At the other end of the spectrum, Birkbeck suggests up to 500,000 Canadians could meet the criteria. This includes people who live with disabilities but have never claimed the disability tax credit because their incomes are too low.

In order to qualify for the tax credit, which is a prerequisite for the RDSP, the disabled person or a family member must have a physician fill out a form describing the extent of the disability, which must then be sent to the Canada Revenue Agency for approval.

As this process can take several months, and given the March 2 deadline, it is unlikely that clients would be able to get the related 2008 government grant were they to apply now, unless they already qualify for the tax credit.

@page_break@The initial deadline to contribute to an RDSP was Dec. 31, 2008, but that was extended by federal Finance Minister Jim Flaherty. IE