TORONTO –
As the federal government pushes to cut bank fees, Canadians are overpaying by more than $7.7 billion annually, according to an economist’s report.
The report by Alberta-based consultancy North Economics compared fees charged by Canada’s Big Five banks to those faced by consumers in the UK and Australia.
It shows that Canadians pay much more each month for bank accounts, as well as insufficient funds fees, overdraft fees and ATM access at rival banks.
To get a sense of how much more Canadians are paying, Alain de Bossart, managing director of North Economics, looked at comparing Canadian and British interest-free retail banks’ profits against their deposits.
Using the retail banking profits-to-deposits ratio for 2022, the report concludes that Canada’s five largest banks had $7.73 billion in “excess” revenue.
The Canadian Bankers Association did not immediately comment, but noted in a recent government statement that competition has led to affordable bank accounts, including 37 per cent of Canadians reporting no account fee.
This report by The Canadian Press was first published March 7, 2024.
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