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Is banking north of the border better?

Expert: Sharon Wilks

Mike asked:

What are the differences between Canadian banks and American banks?

Sharon Wilks answered:

The American Banking System:

  • The United States has a regional banking system. This means that finding one's branch or a bank-specific automated banking machine (ABM) on the other side of the country can be difficult. There are smaller-scale, more independent banks that one might bank at in their hometown and not be able to find in a different state.
  • Cheques are the preferred method of payment in the U.S. because there are several different ABM networks.
  • Bank cards are not guaranteed to work in all banking machines. There isn't the same inter-connectedness there is here in Canada.
  • Bank failures are a lot more common in the United States.

The Canadian Banking System:
  • Canada has a national banking system, where most banks have branches across the country . This makes it feasible for one to bank at their own bank anywhere in the country.
  • This, in turn, makes it easier for Canadians to bank electronically. ABMs and the use of debit cards are a lot more popular in Canada than they are in the United States.
  • Banking systems are much more stable in Canada, as we haven't had a banking failure in some time. Canada's last bank failures were in 1985; the Northland Bank and the Canadian Commercial Bank. Before that, Home Bank was the last in 1923.

About the author

Sharon Wilks is the manager of media relations with the Canadian Bankers Association.

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