Do you have a Registered Disability Savings Plan (RDSP), or another account with a bank? If so, you may be happy to hear about the new Financial Consumer Protection Framework that has come into effect.
As of June 30, 2022, financial institutions across Canada are required to adhere to new regulations intended to protect Canadians in their dealings with banks. The Framework is federally legislated and is overseen by the Financial Consumer Agency of Canada (FCAC). It applies to banks, authorized foreign banks and federal credit unions across the country.
Below, we have outlined some of the key changes introduced by the new Framework, which are designed to protect your rights when dealing with your bank or credit union.
Electronic alerts
You may already have noticed that you’re getting new alerts from your bank about your accounts. These alerts are designed to help you manage your accounts and avoid certain fees.
The alerts will let you know when your bank account balance or available credit falls below a certain amount. They will tell you what charges or fees may apply, and how to avoid them.
The alerts may be sent via email, text or app notification. They will be sent automatically, but you can change or cancel them.
Responsible sales of products and services
Have you ever signed up for a financial product that you don’t really want or understand? Under the new Framework, your bank must provide you with clear and accurate information about any product or service they wish to sell you.
For example, your bank must:
- Offer and sell only products or services that are appropriate for your needs
- Avoid providing misleading information or applying undue pressure when selling you products or services
- Provide separate agreements for optional products and services to help you understand them better
- Provide timely reminders to renew or cancel your products or services
Make sure you ask as many questions as possible when buying a new product or service. You can also take some time to think about it or look around before signing an agreement.
Complaint handling
If you need to make a complaint about your bank, the new Framework should also make it easier to do so.
Your bank now must:
- Deal with complaints within 56 days
- Help you navigate their complaint-handling procedures to make sure you understand the steps involved
- Avoid using misleading terms, such as ombudsperson, that suggest bank employees who handle complaints are independent
These measures will help get your issues resolved in a more timely and effective way. If your bank is unable to resolve your complaint, you can also escalate it to an external complaints body (ECB).
You can learn more about the new Framework by visiting: www.canada.ca/FCAC