Direct Deposit, Governments, and the Banks
Just a little while ago, I got news that a relative of mine will have to direct deposit his Canada Pension Plan cheque, as no more cheques will be issued after a year or so. I have many older relatives near the 80 ish age, while the majority do opt for direct deposit, there were still a healthy minority opting for a cheque in the mail.
They were all told that this is due to the savings that are necessary to reduce paper, energy, and probably manpower costs at the government mailing department. While a mailing may cost 88 c, direct deposit costs probably around 13 or so cents ( http://www.seniorlivingmag.com/articles/2013/04/canadian-government-is-phasing-out-printed-cheques). Millions can be saved, so the government says.
But, to a principle of point, they are also giving direct deposit only to banks, credit unions, also.
Where a person can understand the expediency of direct deposit ( Yours truly goes that way too), because most companies will only pay through that method.
I remember when it all started, in the 90s, having to have to go direct deposit at a private company I worked for when I was in my early twenties, while an older man in his mid 40 s asked why could not continue to have his cheque in his hand ( as he was used to that system), and why could he not cash it anywheres.
Good question. Liberty and freedom, is an important point, but also that the government has to ensure this or it loses its own strength in democracy. Would they rather know where you cash your cheque? I do not believe so, as the cheque will eventually end up at the bank, somehow. Just that you could have cashed it anywhere, a long time ago. But probably paid no fees for cashing it at a store.
While I can understand that approx. 79 % deposit cheques automatically to a financial institution, 21 % (from the article mentioned beforehand) to this day were still doing it their way. And what is wrong with their way?
I understand the cost savings, and I understand the paper savings. A little bit, but not over and above the principle of liberty of cashing your cheque where ever you want.
Deposit rights should not be limited to a payout at a bank, or credit union. For those who are high tech and plugged in, why not allow deposit rights to be given to Bitcoin, for instance? Deposit rights, are very important, and you should always have a means to ensuring you have them.
And the cheques that are direct deposited in welfare, or senior accounts, mostly are low in savings, and are charged the most in fees. Is that fair also, for the government to force people to deposit monies into the local banks that may or may not charge the most for holding their accounts?
Perhaps it will come to a point where governments will regulate the banks so they will not be able to charge high fees on low income bank accounts, if they are pushing some people to cash their cheques direct deposit.
Perhaps the added private costs to these bank accounts, far outweighs the government savings in printing out a cheque... Not sure, but I know a Second World War Veteran who still would like to get his cheque by mail... But, it appears, he will have to follow suit, and direct deposit at your local major financial institution. Why do we want to take his cheque from his hands that fought so hard for our freedoms? Maybe life is too serious for speed, and not for the sensitivity of the actions..
Till next time...
** Called service Canada after posting this. They said that they will continue to mail out cheques, and that the letters below saying it would change April 2016 are not correct- That they (possibly the banks) were trying to push people to direct deposit their cheques. So, if you do not have a bank account, as many people still do not have, keep getting your cheque by mail... Till next time...
*** Better call Service Canada to be sure, cause this changes from everyone you talk to.
They were all told that this is due to the savings that are necessary to reduce paper, energy, and probably manpower costs at the government mailing department. While a mailing may cost 88 c, direct deposit costs probably around 13 or so cents ( http://www.seniorlivingmag.com/articles/2013/04/canadian-government-is-phasing-out-printed-cheques). Millions can be saved, so the government says.
But, to a principle of point, they are also giving direct deposit only to banks, credit unions, also.
Where a person can understand the expediency of direct deposit ( Yours truly goes that way too), because most companies will only pay through that method.
I remember when it all started, in the 90s, having to have to go direct deposit at a private company I worked for when I was in my early twenties, while an older man in his mid 40 s asked why could not continue to have his cheque in his hand ( as he was used to that system), and why could he not cash it anywheres.
Good question. Liberty and freedom, is an important point, but also that the government has to ensure this or it loses its own strength in democracy. Would they rather know where you cash your cheque? I do not believe so, as the cheque will eventually end up at the bank, somehow. Just that you could have cashed it anywhere, a long time ago. But probably paid no fees for cashing it at a store.
While I can understand that approx. 79 % deposit cheques automatically to a financial institution, 21 % (from the article mentioned beforehand) to this day were still doing it their way. And what is wrong with their way?
I understand the cost savings, and I understand the paper savings. A little bit, but not over and above the principle of liberty of cashing your cheque where ever you want.
Deposit rights should not be limited to a payout at a bank, or credit union. For those who are high tech and plugged in, why not allow deposit rights to be given to Bitcoin, for instance? Deposit rights, are very important, and you should always have a means to ensuring you have them.
And the cheques that are direct deposited in welfare, or senior accounts, mostly are low in savings, and are charged the most in fees. Is that fair also, for the government to force people to deposit monies into the local banks that may or may not charge the most for holding their accounts?
Perhaps it will come to a point where governments will regulate the banks so they will not be able to charge high fees on low income bank accounts, if they are pushing some people to cash their cheques direct deposit.
Perhaps the added private costs to these bank accounts, far outweighs the government savings in printing out a cheque... Not sure, but I know a Second World War Veteran who still would like to get his cheque by mail... But, it appears, he will have to follow suit, and direct deposit at your local major financial institution. Why do we want to take his cheque from his hands that fought so hard for our freedoms? Maybe life is too serious for speed, and not for the sensitivity of the actions..
Till next time...
** Called service Canada after posting this. They said that they will continue to mail out cheques, and that the letters below saying it would change April 2016 are not correct- That they (possibly the banks) were trying to push people to direct deposit their cheques. So, if you do not have a bank account, as many people still do not have, keep getting your cheque by mail... Till next time...
*** Better call Service Canada to be sure, cause this changes from everyone you talk to.
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