Editorial: Big banks shirk customer loyalty incentives

Canada’s big banks love to lure new customers using free tablets or phones, but where's the incentive to stay for loyal customers?

Canada’s big six banks love to lure one another’s customers using incentives such as free tablets, prepaid credit cards or other consumer temptations.

Qualifying for that iPad usually means transferring not just a chequing account, but also RSPs, a Tax-Free Savings Account and opening a new credit card.

But what are the banks doing to retain loyal customers? Not very much, it seems.

Most banks offer rewards programs, where points are accumulated through use of an annual fee credit card. Those fees tend to range upwards of $100 to $150. Rewards points accumulated through the credit card can then be redeemed for anything from a kitchen appliance to a tropical vacation. You’re looking at a lifetime of average consumer use to build up enough points for the latter option.

It’s little wonder the lure of a $500 gadget is so appealing to Canadians, when two or even six decades of banking loyalty adds up to little more than a friendlier smile at your home branch.

Banks are terrible at proactively contacting loyal customers and even worse at offering incentives to stay. Ten years with RBC? We’ll waive your banking fees for the next six months. Half a century with TD? Pick a weekend getaway on us. One can dream.

Unlike most grocery rewards programs, banking rewards points require the use of a credit card.

The added benefit of most of those credit cards is a separate travel rewards program, where points can be redeemed for discounted flights (or in other cases, free coffee and donuts). Often the taxes and fuel surcharges are so excessive on flights that those flight points equate to only a few hundred dollars off the price of a $1,000 ticket.

So who’s really benefiting from customer loyalty at the big banks in Canada? Mostly the shareholders and senior executives. Canadian banks are among the most stable investments in the world, thanks in part to good federal policies but also because Canadians are so complacent when being charged for everything from retaining a chequing account to the privilege of using a credit card.

Customers in the U.K. don’t have to put up with a fee for using ATMs at competing banks. Free basic chequing accounts abound online and at many credit unions across Canada.

So next time you’re at the bank, don’t be afraid to ask: But what have you done for me lately? If they’re dismissive, jump ship and show them the consequence of a lack of proactive customer loyalty incentives.


Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Significant donation adds to Victoria Hospitals Foundation’s most ambitious fundraising campaign

Townline’s $600,000 donation helps purchase new 3 Telsa MRI for Royal Jubilee Hospital

Cherry Bomb Toys, which houses the National Toy Museum of Canada, has had a rough year

The property that’s home to Cherry Bomb Toys is listed at $2.6 million

Resident mistakes screaming teens’ late-night plunge for an emergency

Big week for Oak Bay Police who respond to rampant theft in Oak Bay, host Polar Plunge

Victoria hotel proposal threatens Old Town conservation, advocates say

Height requests defy historic district’s guidelines

VIDEO: 7 things you need to know about the 2020 B.C. budget

Surplus of $227 million with big spending on infrastructure and capital projects

POLL: Do you support the proposed changes for ICBC?

Tuesday’s provincial budget predicted a shift from shortfall to surplus in wake… Continue reading

Greater Victoria Crime Stoppers wanted list for the week of Feb. 18

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

Higher costs should kill Trans Mountain pipeline, federal opposition says

Most recent total was $12.6 billion, much higher than a previous $7.4-billion estimate

Wet’suwet’en hereditary chiefs say they’ll meet with ministers if RCMP get out

Federal minister in charge of Indigenous relations has proposed a meeting to diffuse blockades

World Cup skier from Okanagan dies suddenly at 19

Kuroda, who made his World Cup debut earlier this year, passed away suddenly Monday night.

Coastal GasLink pipeline investor committed to closing deal despite protests

Developer TC Energy Corp. — formerly TransCanada Corp. — is to remain the operator of the $6.6-billion pipeline

New highway proposed between Alberta and B.C.

The route would connect Red Deer to Kamloops

What’s in a name? The story of Revelstoke’s Mt. Begbie

It’s likely the iconic peak had several Indigenous peoples’ names before settlers arrived

Most Read