Tag Archives: PC Financial

Which is Better Tangerine or PC Financial: When Will I Get My Bonus Interest from PC Financial?

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Both Tangerine and PC Financial had a special interest promotion where they offered higher interest for new deposits made in September 2014. It’s now October and the first bonus interest payment is in for Tangerine. But I don’t see anything extra in our PC Financial account: when do they pay the bonus interest?

PC Financial Begrudges Paying Bonus Interest

Unlike Tangerine which pays bonus interest at the end of each month of a promotion, PC Financial only pays it once at the end of the promotional period.

Their terms and conditions state that interest will be calculated daily but only paid after the entire promotional time period is over. So the bonus interest payment will be deposited sometime between December 15, 2014 and December 31, 2014. (Don’t be surprised if it doesn’t appear till January 2015 but is back dated to December.)

The interest will be deposited in your savings account if you have one in good standing, or, if not, into your chequing account.

So be patient. It’s coming but not for a long-ish while.

Tangerine Pays Bonus Interest Monthly

As mentioned above, for the past few promotions anyway, Tangerine has paid any promotional bonus interest each month. It shows up as a separate line item for the account. First, they report the regular interest. Then they report any bonus interest.

UPDATE: In 2017, at Tangerine the regular interest for, say, January, would be posted on January 31 and the bonus interest would be posted on February 1. I’m not quite sure why there is a one day delay!

Is Tangerine Paying Compound Interest and PC Financial Paying Simple Interest?

No.

From what I can determine from the original offers’ terms and conditions, neither bank is paying compound interest. So even though you can get and spend your bonus interest more quickly using Tangerine, it does not appear that you will earn more interest than at PC Financial. (In fact, you will earn slightly less as the promotional interest rate at Tangerine was quoted as 3% and at PCF was quoted as 3.1%.)

Well, there’s one possible quirk.

Say you deposited $1000 extra new dollars in Tangerine on September 30. Assuming you don’t touch your account from then until November 1, on November 1, you will receive a bonus interest payment. Because I don’t want to do the math carefully, let’s just estimate it is $1.44.

Now, I suppose, you could take $1.44 out of your $1000 in savings on November 2 and you would still continue to receive the same bonus interest because your total amount in your savings account would still be the $1000 required.

In the PCF account, if you took out the $1.44, you would only be earning promotional interest on $ 1000-$ 1.44 = $ 998.56 for the rest of the year because it won’t pay you the $1.44 until the end of the promotion.

Still, this is just a small quirk. It’s not really got anything to do with compounding interest.

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How Soon Does a Cheque Deposited at CIBC Appear in an Account At PC Financial?

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My most recent test of the slowness on inter-bank transfers was a test of how long it would take for a cheque deposited into a CIBC bank machine to appear as a deposit to a PC Financial bank account.

Why Would I Deposit a Cheque for PC Financial at CIBC?

PC Financial services are provided by the direct banking division of CIBC.

For us, there is no Loblaws or other branch of PC Financial nearby. However, a CIBC branch is within cycling distance of home. So it makes sense to deposit cheques at the CIBC machine rather than at a PCF machine.

Curiously, you can deposit cheques into a CIBC account using an app and taking a photo with your device, but you can’t yet do that for your PC Financial account. (You can deposit cheques using the Tangerine photo app.)

Why Would It Matter How Fast the Cheque Lands In My PC Financial Account?

Well, if you need the money from the cheque to pay your rent this month, it could matter a great deal!

In our case, we were trying to take advantage of a short-term interest rate bonus offered by PC Financial on new Savings deposits. The promotion stated the money had to be in our savings account by September 30, 2014. If it wasn’t, it wouldn’t earn any extra interest.

How Our Test Went for the Deposit of the Cheque at CIBC for PC Financial

We deposited a cheque into a CIBC bank machine located inside a branch at 15:58 (synchronize you watch, Jim!) on Monday, September 8, 2014.

The money appeared in our PC Financial chequing account balance on that same day: Monday September 8, 2014 before 20:53 pm which was the first time I checked our account.

I tested this again on Tuesday. A cheque deposited before 9 a.m. was posted to our account before noon.

Next Step: Testing How Long to Transfer the Money from our Chequing Account to our Savings Account

We then had to transfer the money into our PC Financial Savings account. We started the transfer on Monday September 8, 2014 at 20:55. The money appeared in our Savings account instantaneously!

Yet when we tried to repeat that on Tuesday, it wouldn’t accept the immediate transfer.

Why?

Well because the first cheque deposited was so small that it did not need to go “on hold.” The second cheque was more substantial so it is “on hold” and cannot be transferred to our savings account until it clears. However I’ve since clarified with PC Financial that an increased balance in the No Fee chequing account will also earn the 3.1% promotional interest rate, so I guess there’s no hurry to transfer it to our Savings account.

If you transfer from your Savings to your Chequing account at PC Financial, the fastest you can expect is an over night transfer as the program will not let you request a transfer on the same date. This is different than at Tangerine and frankly I find it very annoying.

But when you transfer from chequing to savings at PCF, it can happen immediately. Good stuff!

Unfortunately, your money may be “on hold” if you deposit a large cheque. Not such good stuff….but it may not actually matter depending what you need to do with the money.

The Conclusion

So in one afternoon and evening, I managed to deposit a cheque into our PC Financial chequing account using a CIBC branch bank machine, then transfer it that same day from our PCF chequing account into our PCF savings account. That means that as of tomorrow, we will start earning the 3.1% short-term bonus rate on our incremental savings.

And I will not have to wait till the larger cheque comes “off hold” before it will start earning the higher promotional interest rate because for this particular promotion it also applies to new funds deposited to the No Fee chequing account provided that increases our total deposited money above the amount we had on September 5.

So a mixture of win/delayed-win.

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