PC Financial | Financial Crooks

We are saving again, this time to replace the roof and furnace sometime in the next two to three years. This is money in addition to our emergency fund: although if the furnace conked out or the shingles blew off, it might be an emergency but the spending to replace both is really a planned expense. Our emergency fund is largely at Oaken Financial in a series of GICs, one of which matures each month ready to cover our budget if we suddenly have no income. This planned expense money, though, could be saved any where. So I decided to shop around and see where I could get a high interest rate for our cash in a no fee daily interest savings account.

Today’s Interest Rate Offers for No Fee Savings Accounts

Here are the rates I found for regular no-fee savings accounts on January 9 2017:

EQ Bank 2%
Alterna Bank 1.95% *
Oaken Financial 1.5%
Tangerine 0.8%
PC Financial 0.8%

* I haven’t used Alterna Bank so I’m not aware of all the details of their business. You can read about them on the RedFlagDeals personal finance forum. They are CDIC insured which is very important to me for any eBank.

What Special Short Term Promotional Rates Are Offered for Savings in January 2017?

There are some promotions going on.

Tangerine is offering

certain customers up to 3.25% on their savings from January 5 – March 31 2017. But it’s not offering the rate to everyone and there isn’t much information on why some people are getting the higher rate.
2% to some customers who phone in and request the higher rate, if they threaten to transfer out large balances, offer to transfer in large balances, or ask based on high usage of Tangerine products such as paying bills and having a mortgage. Not all customers who ask get the higher rate.
1.9% for the first six months to customers opening their first account ever with Tangerine or ING Direct Canada who open only a Savings account
2.4% for the first six months to customers opening their first account ever with Tangerine or ING Direct Canada who open both a Savings and a Chequing account

Could they make this any more confusing?!

PC Financial is offering some customers 1.5% on their savings from January 1 – March 31, 2017. It is not offering that rate to everyone and there isn’t much info on how to get this higher rate.

It’s Tricky to Get the Best Rate for Your Savings Account

The problem is that several of the major e-Banks like Tangerine and PC Financial have switched to offering short-term promotional higher interest rates and only to some customers.

For example, right now, I have an offer from January 5-March 31 2017 from Tangerine for 3.25% on my savings account deposits. My husband, however, has no special offer from Tangerine! He did get offered 1.5% from PC financial for those three months, though.

Some of the Big 5 Canadian Banks (BMO, CIBC, RBC, Scotia, and TD) also come out with short-term higher rates, often linked with opening a new account. Because these are not, generally, no fee accounts, I’m not including them here. A few fees can quickly use up any additional money earned in interest payments!

Where Should I Park My Cash for Three to Six Months While I Wait To Buy My House?

This question gets asked a lot. If you’ve got less than a year until you’re going to buy your home, even though interest rates are painfully low, you’d do better to keep your cash in a savings account. A cashable GIC is unlikely to offer you a better rate and a regular GIC cannot be cashed until it matures. Yes, it would be great to make thousands of dollars by investing in rising stocks but it would be horrible to lose thousands if stocks drop and you have no way of predicting which way they will go.

If you are going to keep your cash in a savings account, though, make sure you get as much interest as you can. It will be taxable but it will still help reduce the impact of inflation on your savings. If your savings are large, be willing to spend an hour or two opening new no-fee bank accounts, if necessary, to get a significantly better rate.

I Don’t Want to Open a Bunch of Bank Accounts: Where Can I Put My Money and Leave It at a Good Rate?

Many people don’t want a series of bank accounts. It’s just too much hassle to open them and to keep track of them.

For those people I’d suggest considering

A local credit union, if one has a good long-lasting rate
Oaken Financial, which has been keeping its savings rate steady for a long period of time
EQ Bank, which is currently the highest rate of the e-Banks that doesn’t offer different rates to different customers when they phone in, but which has dropped its rate twice in 2016 without much forewarning

I wouldn’t suggest Tangerine or PC Financial unless you want both your savings and your chequing accounts at the same bank. Both of these two like to only offer a low regular interest rate, which is 0.8% on January 9 2017, and then offer promotional rates to only some customers for 3-6 months at a time. If you only want a savings account, and you don’t want to track whether you’re maximizing your interest rate by phoning in for promotions, I would stick with a credit union, Oaken or EQ.

What are these paying today, January 9 2017?

Oaken Financial: 1.5%
EQ Bank: 2%
Credit Unions: Vary

What Am I Doing With Our Roof Fund?

Well, since right now I can get 3.25% at Tangerine until the end of March 2017, that’s where the roof money will be parked. What I’ll do in April, though, is hard to say!

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Have you found a good spot to park your cash? Please share your views with a comment.

A few years ago, I compared the features of our PC Financial No Fee Chequing Account and our Tangerine Chequing Account. A few things have changed since then, so I decided to compare them again and see which bank offers the best no-fee daily-interest-paying chequing account.

Why Not Just Have a Chequing Account at Both Tangerine and PC Financial?

Before you worry too much about the details, consider whether you just want to have two chequing accounts, one at Tangerine and one at PC Financial. There is no required minimum balance to have an account at either bank, as of when this was written in December 2016. So you can open one at each bank and use whichever one best suits your needs at the time. That’s what we did.

UPDATE April 2017: While there is no minimum balance required most of the time at Tangerine, to avoid an “inactivity fee” followed by the closure of your account, you now have to make one transaction per year. This can be as simple as transferring or depositing $1 into your account every 364 days, or withdrawing $1. If no activity takes place for 365 days, they will zing you with a $10 fee. If your balance is below $10, they will take all of the money in your account.

NOTE: PC Financial also has an inactivity fee. They start charging the fee if there is no activity for 2 years but they charge $20 per year. So for either bank, make sure you set up an automatic transaction to take place every 364 days to avoid this fee. You could, for example, set up an automatic transfer of $1 in and of $1 out of your account every 6 months.

Does a PC Financial or Tangerine Chequing Account Come with a Debit Card with Flash for Tap Payments?

Both PC Financial and Tangerine chequing accounts come with a free debit card. For both banks you can use the debit card with unlimited free debit transactions to buy stuff. This is one of the major advantages of these two banks over the usual big 5 Canadian banks—most of them charge you a monthly fee that includes a limited number of debit transactions, or require you to keep a large amount of money in the account at all times with no interest paid to get unlimited free transactions.

You can use the debit card to make deposits and withdraw cash, too.

For PC Financial the card can be used at PC Financial kiosks with ABMs, and at CIBC ABMs for no fee.

For Tangerine, the card can be used at Tangerine ABMs, and at Scotiabank ABMs for no fee. There are other ABMs in the Scotiabank network, too, such as ones at Cineplex, which you can find online.

In December 2016, Tangerine began sending out new debit cards that allow Interac Flash payment. After making a regular chip and pin number purchase with the new card, for your next and following transactions you can pay using Interac Flash. According to the Tangerine website you can then pay “by simply holding your Client Card in front of the reader at the checkout.” Flash will only permit purchases of under $100. You’ll also have to use your PIN after every $200 spent using Flash. You can turn off the Flash feature by phoning Tangerine. There is no fee to use the Interac Flash payment method.

In 2015, PC Financial began offering debit cards that allow Interac Flash payment. They did not automatically mail them out, though, and many customers, us included, did not even know they were available! Flash is set to only permit purchases of under $50. You’ll also have to use your PIN after every $200 spent using Flash. According to the PC Financial legal terms, you can disable Flash by calling PC Financial or by visiting a pavilion.

Which Chequing Account Pays the Most Interest, PC Financial or Tangerine?

Until December 1, 2016, Tangerine was paying daily interest on its chequing account as described in my older article. But they dropped the rate they pay on December 1, 2016, without any email or mail warning to its customers. (EQ Bank and Oaken Financial provide early warning to their customers about rate changes.)

This sneaky rate drop was one of the reasons why I decided to review the two bank’s offerings more closely and write a new article.

Right now, on April 30, 2017, Tangerine is paying interest at three levels based on the amount in the amount in the Chequing Account:

0.15% for amounts from $0.01- $49 999
0.55% for amounts from $50 000 – $99 999.99, and
0.65% for amounts from $100 000 and up

(You can check the Tangerine rates online. They do change.)

PC Financial has more levels of interest rates on their No Fee Chequing Account

On the portion of balance between: Annual Interest Rate (%)
$0.00 – $1,000.00 0.05
$1,000.01 – $5,000.00 0.10
$5,000.01 – $10,000.00 0.15
$10,000.01 – $25,000.00 0.25
$25,000.01 and up 0.50

You can check the PC Financial rates online too. They can also change.

You can see
If you keep about this amount in your chequing account

0 – $12 000 you earn the most interest at Tangerine
$13 000 and up you earn the most interest at PC Financial

While this is important for those who carry large balances in their chequing account, it isn’t a deal breaker for me. I keep most of my cash in my savings account and only move it to my chequing account close to when I need to use it. Since Tangerine allows instant transfers between savings and chequing, I can live with their low interest rate for balances above $10 000. Your needs may vary though.

Which Chequing Account Is Best for Actual Cheques: PC Financial or Tangerine?

This one is easy: PC Financial is best for customers who actually use cheques.

As of April 2017, PC Financial was still providing unlimited free paper cheques for its account holders. You order them one batch at a time by mail. Once one set has arrived, though, you can promptly order another set. I have about 150 cheques ready for me to use by ordering ahead. The order is placed very easily online.

Tangerine, on the other hand, only provides its first set of paper cheques for free. After that, you have to purchase additional cheques. They are significantly cheaper than cheques ordered from the Big 5 Canadian banks—but they are also much uglier. UPDATE: In April 2017 they also increased the cost of their cheques but not by much.

So if you are regularly writing cheques, perhaps to fund the endless requests for money from your child’s school, PC Financial offers you the best chequing account.

Do PC Financial and Tangerine Provide Overdraft Protection for Their Chequing Accounts?

Yes, both banks offer an overdraft protection service. I haven’t used either service so I can’t speak personally about whether it works well. I don’t think anyone should ever use overdraft if they can possibly avoid it but that’s just my financially conservative opinion.

Both banks charge a small fee when your account goes below $0.00 and both banks charge interest on the money they loan on your behalf.

Tangerine used to offer free overdraft protection for a small drop below $0.00 when it was owned by another financial institution called ING Direct but now that Scotiabank owns it that service is no longer provided. (Any bank can choose to waive an overdraft fee, though, if they want to please their customer. If you don’t normally end up trying to spend money you don’t have, you may want to phone in and ask if they will forgive your mistake.)

How Easy Is It to Transfer Money Between Chequing and Savings Accounts at Tangerine and PC Financial?

Tangerine is the best of the two banks for transferring money easily between your Savings and your Chequing accounts. You can move your money instantly online with just a few clicks.

For PC Financial, you must wait one business day for a transfer to move your money from Savings to Chequing. You can move it immediately from Chequing to Savings, though. It’s as if they want to make you think before you spend your Savings. It’s annoying though, since they pay higher interest on their Savings so I’d prefer to keep my money there until I have a bill to pay or a purchase to make.

It is free at both banks to transfer money between accounts and to transfer money in and out of other banks. (Note: the other bank, however, may charge a fee. You’d have to check with that bank.)

How Many Free Online Bill Payments Can I Make from my PC Financial or Tangerine Chequing Account?

Both accounts allow you to make unlimited free bill payments online. As with most banks, it can take 2-3 BUSINESS days for the online payment to be received by the company billing you, so be sure to pay early enough to avoid late payment charges.

Can I Set Up Automatic Bill Payments and Pre-Authorized Withdrawals?

Yes, you can arrange to automatically

pay a certain amount to your billing companies
transfer a fixed amount regularly to another bank account either at the same bank or at another bank
authorize a PAD, pre-authorized deduction to pay a bill such as your car insurance

All of these payments and transfers are free.

Can I Set Up Direct Deposit of My Pay Cheque to My Tangerine or PC Financial Chequing Account?

Yes. You can get your employer to deposit your pay directly into your chequing account at either Tangerine or PC Financial. Neither bank charges you a fee for receiving your pay.

How Much Does It Cost to Look at My Cashed Cheques?

If you have a joint account with a partner who doesn’t write down in the cheque book what they used a cheque for, you may like to look online and find out who they sent money and how much was paid.

Both Tangerine and PC Financial let you look online at an image of your cashed cheques to see who they were paid to, when and for how much. It’s free at both banks! Much better than most large Canadian banks which charge a fee.

Online Statements Only

Both banks offer free monthly statements—but only online. If you want a paper statement you’ll have to print it or pay a fee.

Bank Drafts and Certified Cheques

Both banks offer a Bank Draft if you need to make a large secured purchase payment. In both cases, it’s a hassle to get one. You have to pay a fee for this service from both banks. And you have to get it couriered.

Interac e-Transfers to Send Your Money to Someone Via Email

You can send your money to someone else using the Interac e-Transfer option from both Tangerine and PC Financial. Both charge a fee for this service.

Tangerine charges $1 for an Interac e-Transfer, as of April 2017.

PC Financial charges $1.50 for an Interac e-Transfer as of April 2017.

Tangerine also offers from email money transfers although they are a bit slower and more complicated for the receiver to use. They are very simple to use for transferring to another Tangerine customer, though. I email money to my relatives easily because we are both Tangerine customers.

Can I Deposit Cheques Into My Chequing Account Using a Photo App?

Yes, both Tangerine and PC Financial allow you to deposit cheques into your account using a photo-taking app.

I find the PC Financial app a bit harder to use, but it works.

It’s free to use either app.

Which Is The Best Chequing Account – Tangerine or PC Financial?

Personally, I like
PC Financial best for

its free paper cheques

Tangerine best for

its instantaneous transfer between Savings and Chequing accounts
its bill paying interface
its interest rate on low balances
its quick and simple free email transfers to another Tangerine customer

Since both accounts are free to have and do not require a minimum balance, I have an account at both Tangerine and PC Financial.