EQ Bank has released its card product today. | EQ Bank | Discussion forum

It's a debit card.
Personally, I'd much rather use a credit card, where I can push the payment forward a month or so, don't have to keep my cash in a crappy 2.5% account, and will get better cashback.

I would expect that the "no forex" provision will be curtailed or eliminated within a year or so, as all other FIs have done already. That's really the only advantage I see. Does anyone know how their USD exchange rate compares to MC and Visa?

It is not a debit card.

One needs to load the EQ Bank Card with funds from one's savings account. Funds aren't taken automatically from the savings account through the card.

I suspect the interchange to merchant will be the higher interchange for Mastercard prepaid cards and not the Mastercard debit card interchange.

There is tremendous value in the EQ Bank card for those who cannot obtain a credit card and have to use prepaid Mastercard or Visa cards.

One friend was like that. Had to get a prepaid Mastercard from one of those cheque cashing places. Something like $9.99 fee for the card. $5 monthly fee afterwards. 50¢ for each spending charge. $3 fee for each reload!

Such people would save $60+/year.

Not so much for those who can get a regular credit card, like a Capital One Aspire Platinum MasterCard with no annual fee, no transaction fee, and 1% cash back.

The EQ Bank Card isn't a debit card. It's a Canadian dollar prepaid Mastercard that can be loaded from a Savings Plus account.

From the card's FAQ, I don't think the card can be loaded directly from an EQ Bank US Dollar Account:

What does ‘linked account’ mean?
Your linked account is the Savings Plus Account or Joint Savings Plus Account you use to move money to and from your EQ Bank Card. The Savings Plus Account and the Joint Savings Plus Account are the only types of accounts that can be linked to a card.

Loonie said
It's a debit card.
Personally, I'd much rather use a credit card, where I can push the payment forward a month or so, don't have to keep my cash in a crappy 2.5% account, and will get better cashback.

I would expect that the "no forex" provision will be curtailed or eliminated within a year or so, as all other FIs have done already. That's really the only advantage I see. Does anyone know how their USD exchange rate compares to MC and Visa?  

It's actually not a debit card. It's a prepaid credit card, linked to an EQ Savings Plus account. You earn 2.5% interest on card balances, the same as your EQ Savings Plus account. You also earn 0.5% cash back on purchases. I'm not sure whether the CBA voluntary code of conduct for consumer debit card services or the MasterCard Zero Liability Policy is more consumer friendly, but it's the latter that applies here.

It uses the MasterCard International conversion rate, which, according to Wealthsimple, the MasterCard and Visa conversion rates include a roughly 1% built-in premium, but there is no additional conversion surcharge charged by the card issuer. I actually expect this feature to stick; Home Trust Preferred Visa has not eliminated it, nor has Brim Financial MasterCard, and Wealthsimple has a Cash Card with no FX added fee. 🙂

They've now added joint accounts a year or two ago, launched in Quebec, launched their prepaid credit card, and their next product to launch this year will be the EQ Bank Savings Plus Account for Business. I suspect then they'll launch an EQ Card for businesses.

Their competition here is chequing/day-to-day banking accounts. This is game-changing, and I see them taking significant share from digitally-savvy HSBC Advance and even HSBC Premier customers, looking to front-run the eventual forced migration into existing RBC Royal Bank products and their stupid Value product rebate.

I now see no more products they need to launch; I just wish they'd focus on the minor things, like transaction narrative detail. 😉

Cheers,
Doug

Norman1 said
There is tremendous value in the EQ Bank card for those who cannot obtain a credit card and have to use prepaid Mastercard or Visa cards.

One friend was like that. Had to get a prepaid Mastercard from one of those cheque cashing places. Something like $9.99 fee for the card. $5 monthly fee afterwards. 50¢ for each spending charge. $3 fee for each reload!

Such people would save $60+/year.

Not so much for those who can get a regular credit card, like a Capital One Aspire Platinum MasterCard with no annual fee, no transaction fee, and 1% cash back.  

Agreed. The regulatory structure is different than with debit cards, certainly, but I actually see this as a net positive to helping to bust up the Interac Corp. monopoly on physical debit card purchases.

Thankfully, those fee-laden prepaid credit cards' market share is declining, with some companies like Vancity even exiting the business after profiteering in it for years, and they've been replaced by smaller players like the Joker MasterCard and PayPower Visa, but you're right, prepaid cards offer superior, instantaenous online payments.

Personally, I'm seriously considering this as a replacement for my Tangerine chequing account. Sure, I won't be able to write cheques, but I have a ScotiaLine personal line of credit I could use that for in the rare occasion I need to write a cheque, and even add a credit balance to the account to avoid interest charges. I may actually switch my payroll direct deposit to my EQ Plus Savings Plus Account, and then just allocate my discretionary spending to my EQ Card.

Cheers,
Doug

Briguy said

You should compliment this with a Brim credit card and a WealthSimple cash card and have alternatives available when you go travelling for free FX. Or if you go to USA only, then a Rogers credit card would do the trick too instead of Brim. Or keep 5K in your Scotiabank Ultimate Package chequing account and get a free Scotiabank Passport Visa instead of Brim card for travelling.  

Brim is a decent alternative, and I'd forgotten Home Trust Preferred Visa added an annual inactivity fee, so I'd favour Brim. Users on RFD report not being able to apply for Brim's regular credit card, though, so if I couldn't apply via phone, I might go with the CWB credit card, which is issued by Brim.

Rogers cards are a non-starter for me, due to (a) Rogers having a habit of launching things, then shutting them down, (b) Rogers likely having lost interest in their bank subsidiary and there being a high likelihood they'll sell out to Fairstone Bank of Canada, and (c) it's not a true FX fee-free card. They just compensate you with extra points, which they can pull back at a moment's notice, whereas they have to give you 30-60 days notice to change your credit card fees.

Scotiabank's Ultimate Package I don't like, as I've said before. They should make it like the CIBC Smart Plus Account and take into account Scotia iTRADE or Scotia Securities account balances to waive fees.

It's kind of moot, though, since I really don't travel internationally. Last time I was outside the country I was 15 or 16 and it was in the Dominican Republic, with my parents, grandparents, and sister. That was 23-24 years ago.

Cheers,
Doug

Doug said

Personally, I'm seriously considering this as a replacement for my Tangerine chequing account. Sure, I won't be able to write cheques, but I have a ScotiaLine personal line of credit I could use that for in the rare occasion I need to write a cheque, and even add a credit balance to the account to avoid interest charges. I may actually switch my payroll direct deposit to my EQ Plus Savings Plus Account, and then just allocate my discretionary spending to my EQ Card.

Cheers,
Doug  

This card/all-in-one bank account combo does look really good but there's still no opportunity to deposit cash or write cheques, or have wire transfers or bank drafts, so you're going to need a backup account somewhere. There's no way you could make a major purchase without a bank draft/money order/certified cheque.

Doug said
While it's true you can't deposit cash, for that sort of thing, I would still main a basic no fee chequing account with Tangerine or a single-purpose HISA with a credit union. I could also make a deposit to my Money Master Savings at Scotiabank, then transfer fee-free to Scotia iTRADE, then push money out to EQ Bank. No holds at any step of the process. 🙂
Cheers,
Doug  

Isn't EQ one of the FIs that still holds the funds even if you had pushed the funds into EQ from an external linked FI? I believe Hubert also holds funds even if pushed into Hubert from an external linked account.