Canada Has New Financial Rules & Your Bank Now Must Alert You If You're Low On Money

There will be changes to hidden fees, coercive sales practices and more. 👀

A Scotiabank branch. Right: A Bank of Montreal branch.

A Scotiabank branch. Right: A Bank of Montreal branch.

The government of Canada is introducing a huge swath of new banking regulations on June 30, and it means that your money and finances could be much more protected.

In a statement, the federal government said these changes that are being implemented will fulfill promises made back in 2018 to create a new "Financial Consumer Protection Framework."

This is meant to hold banks in Canada to a higher standard and require them to "take greater responsibility for consumer outcomes."

Consumers of financial institutions will now have increased protection from hidden fees, coercive sales practices and much more.

The new rules allow Canadians to be given more information about the services their bank is offering so they can make better, more informed financial decisions.

Plus, banks must now deal with all customer complaints within 56 days.

This is the first time in Canadian history that these financial institutions are required by law to address complaints within a given timeframe.

Banks will also have to alert their customers when any of their products or services are about to end to double-check and confirm if they want to renew or cancel, rather than automatically renewing with no warning.

And, maybe the biggest rule change of them all, banks must now let consumers know when they're low on money.

As of June 30, electronic alerts will be sent out whenever accounts are nearing the red.

This was implemented to protect people from going into overdraft or over their credit limit and the ensuing fees.

Banks must also provide agreements for each service or product so that consumers fully understand what they're buying, what it costs and how to cancel it.

They also have to start following regulations that prevent coercive or misleading sales tactics. Plus, they now have to set up a whistleblower program for any employees who notice problems in the company.

This is just one of a few ways the government is trying to ease the financial stress on Canadians.

A recent boost to the Canada Workers Benefit means that millions of Canadians will now qualify for some more money.

Tristan Wheeler
Tristan Wheeler was a Creator for Narcity Media focused on money and budgets and is based in Toronto, Ontario.