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Canada Post moves toward postal banking services in new loan program with TD Bank

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Canada Post is now officially launching its partnership with TD Bank Group, providing stamps, packaging and loans in addition to its existing financial services.

The Crown Corporation said Wednesday that the loan program could be expanded to other services, offering more financial options to Canadians across the country, including rural, remote and Indigenous communities.

“This will give Canadians, especially underserved Canadians, better access to financial services,” Michael Yi, vice president of financial services at Canada Post, said in a pre-launch interview. I believe it is the best way.

Loans range from $1,000 to $30,000, bridging the gap between payday lenders and traditional banks. Loans are subject to interest rates set by TD, but customers do not need to have a bank account and can avail credit for the first time.

“What we’ve learned from talking to Canadians is that the market really needs access to simple, affordable loan services,” says Yee.

Loan program is run by TD

The Postal Service has been running a pilot loan program called MyMoney since last year, and in recent weeks has ramped up the program at nearly 6,000 post offices nationwide. Customers use the loans for unforeseen emergencies like car repairs and veterinary bills, as well as to consolidate debt from high-interest products, Yee said. .

Postal workers are not permitted to give financial advice, but are trained to guide customers on how to apply for loans online or over the phone and to provide more informative materials. TD employees support our clients through the real-world application, decision-making, and fundraising processes.

The partnership will help TD reach more Canadians, said Michael Rhodes, group head of Canada’s Personal Banking Division, in a statement.

“Financial services are essential services and this partnership allows TD to play a key role in extending access to banking to more Canadians.”

Financial terms not disclosed

Canada Post declined to provide details on the commercial terms of its partnership with TD. This includes how both parties share benefits and risks.

The Canadian Postal Workers Union supports the move as part of a broader effort to bring low-cost banking to post offices, said national president Jan Simpson.

“This is just the beginning, because we are pushing for a full public bank. As we know, in France and elsewhere in the world, postal banks are really I know it’s been successful, and I know it could be successful here in Canada.Likewise.”

Canada had a post office-based national savings bank until 1969, although other countries such as Italy, Brazil, New Zealand and Switzerland also offer postal banks.

Simpson said it was important to ensure adequate staffing as Canada Post seeks to roll out more services, but the expanded service will help pay down the company’s debt levels and Joining a union can help create good jobs and support the local community.

“I hope Canada Post expands beyond loans to include savings accounts, checking accounts, mortgages, insurance and even credit cards, because in our society today we don’t have enough bank accounts. Because we need to provide more services to people who don’t have it,” she said. she said.

Canada Post already offers a range of financial services, including international money transfers, money orders and prepaid gift cards, representing 5 million transactions worth $2 billion annually, but the new program will be broader. Yee said it could be part of an expansion.

“We believe we have a strong foundation and have already become a trusted partner for many Canadians to provide financial services. Therefore, we look forward to expanding these financial services through partnerships in the future.” , we aim to provide better access for Canadians.”

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