Tuesday, November 20, 2007

Return of the Canadian High-Interest Savings

A long time ago, in a blog not so far away, I wrote about opening an account with ING Direct, HSBC Direct, Canadian Tire Financial Services and ICICI Bank. I also wrote about using each bank's online interface to move money in and out of the accounts. ING came out on top in both of these comparisons, due to its speedy and painless account opening process, and its slick web interface and clockwork fund transfers. I wanted to finish off this comparison by looking at the access methods available for each of these accounts.

Online/Telephone Banking

This is the core access method for all four institutions. In order to get any access to your account, you first have to activate online/telephone banking. I haven't tried telephone banking, but the functionality is the same as for online banking. The only differentiator here is that HSBC provides online bill payment from your savings account. Other than that, all four have the same core set of features.

Advantage: HSBC wins, as the only institution to provide online bill payment from the savings account.

ABM Network

ING, HSBC and ICICI all provide surcharge-free transactions from their own ABMs. Canadian Tire does not have an ABM network, and in fact does not even provide an access card with the account. While I have never seen an ING or ICICI ABM, HSBC also provides free transactions at Bank Of Montreal ABMs, which are pretty much everywhere. HSBC is the only institution to provide an access card by default.

Advantage: HSBC is a clear winner, with very high ABM availability.

Writing Cheques

None of the four institutions provide the ability to write cheques.

Advantage: None.

Branch Network

ING has four offices in Canada, so technically they provide the option for face-to-face banking. HSBC has an extensive branch network, but their Direct Savings account is not accessible through branches. Canadian Tire and ICICI, as far as I can tell, do not even have branches.

Advantage: ING, for at least making a token effort to provide face-to-face banking.

Overall

HSBC has the most impressive access methods. In fact, aside from the lack of paper cheques, the HSBC account could almost serve as a primary chequing account.

Final Verdict

ING has the most "feel-good" account. Setting up and using the account is a breeze, and transactions are processed exactly according to their stated timelines. They do, however, have the lowest interest rate of the four, and their access methods are pretty much limited to transferring funds in and out of your account online or over the phone.

HSBC has the best combination of rate and access methods, but you have to put up with a less-than-stellar web interface and account opening process.

Verdict: A tie between ING and HSBC. The choice between these two will really depend on how important the various features are to you. The good news is that, with no fees and no minimums, there's nothing stopping you from opening an account with more than one of these institutions. I have an account with each of the four. If you're not sure which one you want, I'd start with ING, and see how you like it. If you find that you need more access methods, then give HSBC a shot.

1 comment:

Fecundity said...

Kinda wondering why you aren't comparing PC Financial to the rest of them. Is it because for most services you require their chequing account as well? Possibly an added inconvenience, but since it's no-fee chequing, I don't really see it as a problem for most people.

They have savings accounts currently giving just over 3% or 4% interest, depending on which account you open. They provide debit cards and ABM access to all CIBC and PC Financial machines (other ABMs are usable but cost fees). Online and telephone banking are easy and smooth. They have 'customer service' pavilions (rather than actual branches)in most large stores providing in-person help for services.

The catch is that all bill payments and ABM transactions must go through the chequing account, and money coming out of the savings accounts to chequing must be arranged 24 hours in advance (easy to do online). Money can be transferred from chequing to savings immediately.

I haven't used the other accounts, so I don't know if PC is better or worse than the others. It certainly sounds comparable, though.