Anytime you open a bank account, sign up for a new credit card, or take out a loan you’re entering into a contract. Almost every banking or monetary interaction you have comes with a set of rights and responsibilities for yourself, and your financial institution.
If you know and understand your rights it’s easier to avoid costly surprises and to reach your financial goals. It’s important to remember that just as your bank should communicate what your rights are, you have a responsibility to inform yourself of any fees, rates, terms, and penalties linked to any financial services and products.
Here are a few tips to help you understand, and exercise, your financial rights:
1. Financial institutions need your consent
Banks have a responsibility to obtain your formal consent before they issue you a credit card or raise your credit limit. You are under no obligation to activate that shiny new credit card that showed up in your mailbox. Here is a list of your credit card rights and responsibilities.
2. Everyone has a right to a bank account
Acceptable ID is the only requirement to open a bank account with any financial institution. Your driver’s licence, passport, birth certificate, or Social Insurance Number card are all you need.
3. Government cheques can be cashed at no cost
While most financial institutions have fees associated with transactions, it’s free to deposit a Government of Canada cheque at any financial institution (even if it’s not your own).
4. Hidden fees are not ok
It’s up to your financial institution to be up front with all costs associated when you open a new account. Make sure you understand what rates, terms, and penalties come along with the service or product. It’s a good idea to review your transaction fees regularly, and when your financial situation changes, you might be better served with a different kind of account.
5. Changes must be communicated, too
As a customer, you have a right to be informed anytime your bank fees or charges change. They can make you aware of changes electronically, so be sure to read every email you receive from a financial institution carefully.
6. It’s up to you to monitor your own finances
It’s on you to be aware of your own financial situation. So many of us rely on internet banking and paperless billing that it’s easy to miss a statement or pay a bill a little late. Make sure you’re checking all of your statements carefully, so you can let your bank know immediately if there’s something not right. Here is a list of the types of information your financial institution must provide as related to different products and services.
If you feel your rights have been violated, here’s a resource on how to make a complaint. And if you’re looking for more information to help you build your financial knowledge, skills, and confidence? Check out Vancity’s free Each One, Teach One program and find out when the next financial literacy workshop is happening.