The surging popularity of e-transfers could soon cancel the newspaper cheque’s standing as our favorite way to send cash.
The cheque as we know it has existed for 300 years, while the Interac e-transfer dates back 15 years. But recent trends suggest e-transfers could overtake cheques in popularity in a couple of years. A pair of new features to create e-transfers more convenient could accelerate the procedure.
The e-transfer permits you to send someone money electronically via text or e-mail. Now, there is a new choice to use e-transfers to request money from someone. All you need is their email address or cell phone number (for sending a text). Add a brief personal message, specify the amount of money owed and then click on send.
Another new e-transfer feature will help on the receiving end. Now you can authorize e-transfers delivered your way to be directly deposited into your account without you having to answer a security question. With the conventional e-transfer, the deposit is only made once you answer a security question designed to ensure the right person is getting the money.
About 75 percent of the banks and credit unions offering e-transfers have both of these new services in place and many others should be on board from the beginning of next year. Expect them to assist e-transfers further erode the cheque as our favorite way in Canada of sending money to somebody.
Roughly 242 million personal cheques were processed in 2016 with a total value of just under $100-billion, based on Payments Canada, which co-ordinates the nation’s system for managing cheques, direct deposits, debit and ATM transactions and much more. Interac — the ATM, debit and e-transfer network — says that there were 158 million e-transfers last year with a value of $63-billion.
This year, Interac is on track to process over 230 million e-transfers having an estimated price of $90-billion. The change away from cheques can not arrive fast enough since the e-transfer is far better than a cheque whatsoever. The sender sees the cash leave their account immediately, so there is no waiting around. The receiver can deposit the transfer instantly using a telephone, tablet or pc.
The new autodeposit feature will help accelerate the decline of cheques. If you are considering bypassing the security question when you get an e-transfer, simply log into your bank account online and put it up this taste. The goal of the security question would be to protect senders in the event they sent an e-transfer into the incorrect e-mail address or texted it to the wrong phone number. But the security feature gets tedious and unnecessary if you are receiving money from the very same individuals repeatedly.
The request-money feature allows someone to send an email or text to request payment of a predetermined amount of money. The receiver can decline the request or use a link contained in the petition to make the payment via e-transfer.
It looks like companies are a prime target for the request-money feature. Your gardener or adolescent might use it to charge you, for instance. Sending someone a request for cash is also a fantastic way to show someone how much faster and simpler e-transfer is than writing a cheque.
At least one of the banks offering the request-money attribute is pitching it as being available free of cost for a trial period, which suggests a fee could be billed later. However, Debbie Gamble, vice-president of electronic products and platforms in Interac, stated the overall tendency with e-transfers is for banks and credit unions to remove fees for a restricted or frequently unlimited number of trades. “These are the kind of offerings which 21st-century digital trade users expect to get,” she said. “So I think you’ll see that free or a flavour of free trend continue as the service grows.”
In 2002, when e-transfers were released, 814.5 million personal cheques were processed using a total value of $210-billion. Tech has made cashing a cheque easier in recent years — several banks today allow you to deposit a cheque into your bank account by taking a photograph of it with your smartphone or tablet computer. There is no need to visit a bank branch.
Cheques are gradually fading, though. If you doubt it, ask people 30 and under the number of cheques they wrote in the last year.
Courtesy: The Globe And Mail