May 11th, 2020
LETTER: The Time for Postal Banking is Now
Dear Minister Morneau,
I am writing today to identify issues facing CERB access for many constituents in my riding. I've heard from many constituents that have applied for the CERB that have had to deal with lengthy wait times. On top of it, many constituents of mine don't have bank accounts which creates problems with accessing the money in a timely fashion - forcing them to find a predatory cheque cashing service that may not even be in their community while losing money as a result of exorbitant fees.
This problem isn't unique to my riding, Canadians across the country are paying the price for decades of Liberal and Conservative deregulation of the banking system that has left far too many unprotected and at the mercy of greedy financial institutions. Since 1990, Canada has lost 1700 banking branches meaning many communities don't have access to banking services. As the Canadian Centre for Policy Alternatives notes, "In 2010, a study by Vision Critical (commissioned by ING Direct bank before it was taken over by the Bank of Nova Scotia) found that banking fees in Canada were among the highest in the world. More than half of Canadians (55%) have fee-based chequing accounts and, on average, pay $185 per year in fees for these accounts. Credit card rates remain high in spite of 6 Canadian Centre for Policy Alternatives low Bank of Canada prime rates. Typical bank card interest rate hovers around 20% annually and department store cards are closer to 30%."
The problems facing First Nations are even more pronounced. Indigenous communities remain largely without banks or credit unions. There are 615 First Nations communities in Canada today and many other Metis and non-status communities. Only 54 of them have bank or credit union branches.
The solution is clear. Canadians need postal banking. This would ensure Canadians in underserved communities would get access to banking services and all Canadians would be able to avoid the exploitive actions of big banks. The infrastructure already exists. There are more than 6,200 Canada Post locations across the country, with roughly 60% of them serving rural and remote communities. Canada Post already provides some financial services, such as postal money orders, domestic and international money transfers, bill payment and financial transaction and payment. There's no reason to not expand those services to include access by all banks and credit union customers to their accounts to deposit or withdraw cash, saving accounts and low-fee chequing accounts as well as low-interest credit cards and prepaid debit cards. This would allow individual Canadians already on the margins greater financial stability, something we should all get behind.
The time for postal banking is now. Please let me know what steps your government is taking to ensure Canadians can access their money in a fair and efficient manner.
MP Niki Ashton (Churchill--Keewatinook Aski)