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Canadian banks confuse me

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Dr. Radiaki

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For you non-Canadians, Canada is dominated by the 'Big Six,' banks with branches across the country, who have a great deal of power. This power is mostly awarded to them by the government, their success and size being secondary factors. <_<

RBC, one of those banks, has been running a a series of ads with the intriguing line of ad copy: "Invest in a worthy cause. You."

The ad promotes RRSPs, and demonstrates how micro-deposits over a long period of time can add up to a great deal of extra money for retirement. Logical enough, right? The angle being that you don't need to invest a great deal at once to be rewarded for your investment.

"Could it be," I thought, "a major bank promoting rational self-interest?"

I read the fine print(with rather too much excitement, I might add), and of course, I was disappointed. It seems that RBC is planning to donate $10 to humanitarian relief for every new account opened through this promotion.

:dough:

Explain to me why major banks will routinely charge fees for completely paperless transactions(Which, I recognize, they are fully within their rights to do), and then spend even a portion of the money so collected on a charity? Maybe put some of those profits back into the business? Give a little better interest rate?

Sheesh.

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RBC, one of those banks, has been running a a series of ads with the intriguing line of ad copy: "Invest in a worthy cause. You." ...

"Could it be," I thought, "a major bank promoting rational self-interest?"

Few western cultures are so degenerate as not to have at least some respect for the individual left within them. The problem is supposed "excess" concern for oneself...

It seems that RBC is planning to donate $10 to humanitarian relief for every new account opened through this promotion.

Explain to me why major banks will routinely charge fees for completely paperless transactions, and then spend even a portion of the money so collected on a charity?

It's that "excess" again, coupled with direct political considerations.

In relation to customers, the banks gain them by making an appeal to customers' self-interest while helping customers feel better about themselves morally through donation to altruistic causes. Essentially, the banks are saying "We can get you greater returns while better assuaging your guilt than the competition can!" A mixed-message appeal to potential customers with mixed moral codes, as to be expected in our mixed culture.

Within themselves, they charge for those transactions because they can do so at a rate that results in a revenue that exceeds their costs (paperless != costless), netting them a profit. Then they do altruistic things to try to ward off the whiners and looters. Being big, and having improper powers because of government, keeps them constantly in the eyes of both consumer groups and the the federal government.

JJM

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