Virtual Banking Isn’t For Me

Hubby and I recently switched banks in an effort to save money on bank fees. We didn’t leave our former bank on bad terms, we were just looking to free up a little room in our monthly budget so we switched to a no-fee bank.This change hasn’t been without a few bumps in the road but yesterday was my breaking point.

It’s 2013 and I still get my paycheque in physical cheque form. I’m not kidding. I think I’m the last person in the world who gets paid this way. I went to university for six years to get this education you’d think my employer would offer direct deposit but the fact is that there are less than ten employees and direct deposit is very expensive. Our office manager can take care of it all. Though it can be a bit of a scramble to get paid on time when the boss is on vacation, they’re pretty good at making sure we have it on time, often paying is early if needed.

Needless to say, having holds on deposits for us is not an option. We can’t afford to deposit my income and have it held for five days while the cheque clears. It would totally screw up our budget and bill paying system. When I brought these points up to our current bank they basically said there’s nothing they can do other than offering us an immediate access to funds upwards of $200. Sorry this isn’t going to work. I called to complain yesterday and asked to speak to the supervisor. She basically said her hands were tied, there was nothing they could do to help us.

If I had an actual branch to deal with would be more options for us in terms of immediate access to funds; or with teller services, having certain cheques cleared.

I respect that new customers at banks may have a short initiation period of sorts but c’ommon! I mean charge my $2000 or something if I have an NSF, I don’t care what you feel you may need to do to cover your asses I just want immediate access to my money. If we had a bad history I get that, but we don’t.

I didn’t realize how much I enjoyed the amenities of a traditional banking system until I didn’t have them. Though I rarely use the teller services, I like having the option when issues arise. I like figuring problems out face-to-face and building relationships with the people who hold my money. I miss being able to call the bank to ask Betty/Bob/Ben a question. I miss the people.

And so, next week hubby and I have an appointment with the bank that holds our mortgage and RESP to see what we can work out in terms of opening new accounts with them. Based on the conversation I already had with them it sounds promising.

I’m looking forward to sitting down and getting to know people again. Put faces to names and trust the people who hold our money.

What sort of accounts/banking system do you use?


  1. Sucky! I use Scotia for my personal chequing/savings and ING Direct for my joint chequing account, joint savings account, emergency fund and wedding fund. I honestly only still have my scotia account because I want a separate chequing account of my own and my visa and line of credit is through them. I haven’t had any problems with ING, but I do like being able to walk into the scotia branch and request that they not put a hold on my physical paycheques! (Yes, you aren’t the only one!)
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  2. I haven’t had to deposit a paycheck on a regular basis in 15-20 years. Every place I’ve worked has offered it. Usually last paychecks or first paychecks require you to get a paper check, but believe me, direct deposit is one thing I waste no time in signing up.
    Michael @ So You Think You Can Save recently posted..Research Purchases With Product ReviewsMy Profile

  3. We tried to use PC banking but we couldnt manage our finances with the holds etc. So as of late we have just been sucking it up and sticking with TD. I do hate paying bank fees, but we have a really helpful banker gal who has helped guide us with some better money decisions.

    • Catherine says:

      Yes, we were with TD and I really liked them but the bank fees were outrageous. When I started with them my same account was less than $4 by the time I left that same account was $13! Because we have a mortgage w/ CIBC already they discount bank fees.

  4. Working with a lot of small business we get paid by check all the time so I can understand the hassle. If it were not for that we’d go completely online. We get to deal with the holds as well, but have built enough of a cushion that it generally is not an issue.
    John S @ Frugal Rules recently posted..Things That Make Me Scratch My HeadMy Profile

  5. Very good points here. I am so happy we did not go the virtual banking route in 2012 when we were toying with the idea. This post is potentially useful for scores of people. Well done, says, the Hoombah!
    cj recently posted..2012 Tax Jubilee!My Profile

  6. Considering I was a bank teller for 2 years, I would have to agree with you that virtual banking isn’t for me either. When you bank with actual people and they get to know you, they are more likely to take off the hold on the cheque and go out on a limb for you because you have built a mutual trusting relationship of sorts.
    Girl Meets Debt recently posted..Girl Meets Debt’s ManifestoMy Profile

  7. I think it is a good idea to have an account located at a branch close to you, just for reasons you mentioned. I used to have a job where we got paper checks and Iwould deposit the check through my online banking mobile app on my phone. Worked great! You just take a picture of it and it is deposited immediately. I thought it was a pain to even do that! I probably haven’t been inside a branch in five years or so, but I do still keep an account with them just for the flexibility and “what if” scenarios. Same reason I still use personal checks of my own (how I wish they would become extinct) small town and not everyone takes credit cards. Anyway–we use three banks–one that has branches close to us and one that doesn’t, and one that is completely online. No problems so far! I suggest finding a band that has a fantastic mobile app.

  8. This is the reason why I have multiple bank accounts at different banks. I have two at a traditional bank and three at an online/virtual bank. This works for me and keeps me away from all of the issues. Good luck resolving it.
    Grayson @ Debt Roundup recently posted..Why Do Sales Make Us Irrational Shoppers?My Profile

  9. I belong to a credit union. Maybe I’m a weirdo, but I don’t know many people in real life who use virtual banks, so I’m just clueless when it comes to it.
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  10. Why do you have so little margin in your accounts/budget that you can’t wait for a hold to clear?? I guess if you can’t get around that problem you should go back to a more-services bank model but it seems you should be able to.

    We use internet-only banks but we have direct deposit. We have experienced far better customer service with our online-only bank than we did with our brick-and-mortar bank, even in person. I would much rather wait for a hold to clear than pay fees to bank.
    Emily @ evolvingPF recently posted..What Is a Courtesy Letter and Does It Mean I Don’t Have to Pay Taxes?My Profile

  11. 2 Credit Unions, 1 Large Bank (Chase) and an online bank (CapitalOne because they purchased the US arm of ING Direct). We all of our joint expenses from one of the credit unions and I hold a personal account in the other because it is a much smaller membership base filled with high earners so they have great loan terms (even though we don’t have any loans). I have chase because that is were my safety deposit box is and neither credit union offers this service. We use CapitalOne as our “emergency” fund / savings goals.

  12. We finally signed up for online banking last year and I actually started to like it once I got used to it. Still, it doesn’t take 5 days for a check to post to my account. Why does your bank take that long?
    Holly@ClubThrifty recently posted..The U.S. Healthcare System and Your FinancesMy Profile

    • Catherine says:

      I don’t know truthfully, they just decreased it from 7 days too! I think it has to do with fraud protection.

  13. You’re not the last person in the world. I’m right there with you as clients still pay me through checks. Of course I don’t work for one employer, but I miss direct deposit when I was working full time. Anyway, I have a little of both. I use BOA for my basic checking and savings, then ING (or whatever it’s called now) for savings buckets. Having both is a good option for me, although I still hate the BOA fees!
    Budget & the Beach recently posted..One Step at a Time: Part TwoMy Profile

  14. I am banking almost fully virtual. Except for

    one Guatemalan account, all my foreign bills

    and deposits are made online, I am surprised

    it costs money to make a deposit, it is free

    with all my banks and makes life so much

    Pauline recently posted..Financial goals update, March 1st 2013My Profile

    • Catherine says:

      You have a bit of a different situation I think living where you do. In your situation I probably would.

  15. Ya I can see that could be super annoying. Actually BF had a similar situation, as one of his banks didn’t have branches either but just online which was super frustrating sometimes.
    Mo’ Money Mo’ Houses recently posted..Why Family & Money Should Not MixMy Profile

  16. Oh, what a pain! I would’t like a five-day hold on my deposit either. I remember when direct deposit first became available, it felt weird not to get a physical check! There is something to be said for dealing with real, live people, but I hate the fees too. 🙂 Good luck getting everything resolved!
    Shannon @ The Heavy Purse recently posted..Meet Shannon Ryan: Financial Literacy AdvocateMy Profile

  17. I have a bricks and mortar bank for the customer service and face to face stuff I need to do, and a virtual bank for saving (ING, now Capital one 360). I’m happy with both at the moment.
    KK @ Student Debt Survivor recently posted..Advice From Your TherapistMy Profile

  18. Justin@TheFrugalPath says:

    We have two accounts. One is at a brick and mortar bank. We have our everyday account there. It has no interest, and is mainly for bills. At the end of every month we make sure there is $500 in it and the rest gets transferred to either debt or savings.
    Our emergency fund is in an online account that has the five day waiting period. It’s annoying, but we can use checks or a card for emergencies. It gets better interest than a brick and mortar, but the money is just for emergencies.
    Justin@TheFrugalPath recently posted..Planwise: The No Personal Data Financial ToolMy Profile

  19. I bank with PC Financial and I have since I was 18 (I’m 29 now) … I moved to them when CIBC wanted to start charging me fees when I turned 18. I guess the paycheque issue and the fact that they are not able to make an exception would be a deal breaker for me … but I get direct deposit so I hadn’t thought about that. Also, way back when, they gave everyone access to the first $1000 so I still have that … if I deposit a cheque they only hold everything over $1000 which is very rare for me to receive a cheque that large. I would be annoyed it they put it down to $200 as well.

    As for customer service, I have never had a problem with them. I have chequing accounts, savings, line of credit, mastercard, and my mortgage with them. The only minor inconvenience I experienced was when I bought my house and needed a certified cheque for a deposit … I had to get my mom to get one for me from her back (Scotia) … but other than that, I think it’s worked out in my favour, saving at least $10 a month on bank fees times 11 years ($1320!!!).

    Hope it works out for you and you are able to get the new bank to waive your fees.


    • Catherine says:

      this was the first issue we’ve had and if we had access to 1000 it wouldn’t be an issue but the fact that they’re unwilling to increase the 200 is just plain dumb in my mind! I also hate bank fees but if we go w/ CIBC- where our mortgage is (we went through a broker) we get 50% off bank fees for multiple accounts so it won’t be such a hard pill to swallow.

  20. You’re not the last person to still receive a paper check, I am stuck in the stone ages with you as well lol. I would love to have direct deposit but my employer doesn’t offer it. I use an online bank for my savings so that I don’t have immediate access to it and don’t make any impulse buys. As for my checking account I use to pay bills I still use a traditional bank. I’m not quite brave enough to take that one virtual.
    Alexa recently posted..Shielding Children from Financial Struggles as a Single MomMy Profile

  21. For a couple of years I used ING Direct for chequing/savings purposes but I always maintained an account with TD Canada Trust. Now that I cross the Canada/US border on a frequent basis I moved over all my non retirement assets back to TD (in both countries) and I now pay no fees to bank with them either in Canada or in the US. I have dealt with my TD Canada Trust branch for over 15 years so that personalized service has really helped. As you correctly pointed out, virtual banking doesn’t meet everyone’s needs.
    K.K.@ Living Debt Free Rocks! recently posted..Giving Feels GoodMy Profile

  22. I use a regular bank for day to day stuff and our EF savings but ING (Captial One, whatever) for our long term savings. I don’t like having easy access to that money because some days I don’t trust myself. Putting it out of reach like that makes a huge difference.
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  23. Sorry to hear about your difficulties with said bank and good luck finding a better provider. Interesting post!

  24. We use mainly a credit union, we find them a lot more personal and it seems as though the individual bankers have a little more latitude when it comes to things around general policy… if they like you, they are able to help you a little more. We have both the company account and personal @ the Credit Union but we also keep accounts at the Royal, it never hurts to let the bank you are dealing with know that they have competition that is readily available.

    As for your work… have they never heard of EFT ? it’s cheaper/faster/easier than writing/mailing cheques.

    Didn’t realize things were quite the way they appear to be CA… I’ll call you later today. Maybe email me if yer going to be around ?

  25. I have an online savings account because it has a better rate, but I use a local brick and mortar bank for most of my day to day banking. I like being able to speak with a person, and they all know me. They also don’t charge fees if I make two debit card transactions per month and do e-statements.
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    • Catherine says:

      What?! That’s great! I feel like as Canadians we’re getting the short end of the stick big time in terms of banking fees and competition.

  26. I use both RBC and a credit union. I love my credit union – small town dealt with them since i was about 5 and my parents opened my savings account. RBC it drives me nuts that i have to pay 14.95 a month in fees to have my account.


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