Where would you cash your paycheque if you didn’t have a bank in your community or a bank account to electronically deposit your earnings? In many remote, northern communities access to bank services are few, far, in between, and non-existent. How could this be? Keep reading and you’ll find out.
A couple years ago Katie Randall wrote about her experience delivering financial literacy across the NWT and the barriers that many communities face when accessing financial services like banking. Today those barriers still exist and are becoming a social issue, as payday lenders charge the highest interest rates allowable by law (up to 60% annum) and cheque-cashing businesses, that charge a percentage of the total cheque, fill the gap.
Some might say “Why don’t people just open a bank account then?” It’s not that simple; most banks require you to go to a branch – the same goes for accessing various other financial services one might need to plan for retirement, a child’s education, a loan or mortgage.
Something must be done to remove these barriers, but what? Bring up your favourite search engine and type in “Postal Banking.”
Postal banking isn’t new. Canada Post started offering banking services in 1868. By 1969 the chartered banks’ challenges and lobbying forced the government to wind down postal banking.
Services could include savings and chequing accounts, online banking, bank machines, credit cards, debit cards, pre-paid cards, money transfers (including remittances), insurance (home, auto, travel, etc.), loans and mortgages, investment products (RRSPs, mutual funds, annuities), foreign currency, and other services such as financial counselling – basically every service offered by the big banks but for EVERYONE and in the best interest of Canadians, similar to the postal banking services already offered in countries like France, Brazil, New Zealand, Italy, and Switzerland.
With 6,300 outlets, Canada Post has the largest network in our country. It has infrastructure that could support the offering of affordable internet and cell phone services to thousands of Canadians. Why not create a postal banking service to increase Canada Post’s revenue on the condition that a percentage of all profits from postal banking are invested back into the communities they serve?
This week’s guest blog is by Alexander Lambrecht, President of the Northern Territories Federation of Labour. If this is a subject that interests you, the federal government is currently seeking input from Canadians during its Canada Post Review.
