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Email this8:10 pm
November 3, 2022
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I've opened my first GIC with Tangerine, thanks to their 5.5% rate and Peter's $50 bonus promotion.
The way that they handle externally transferred funds in a GIC is a bit puzzling.
I opened a $5k GIC over the weekend, funded from my TD account, which is linked to Tang.
On Monday the full $5000 was shown as debited from TD, and the same amount is showing as the amount of my GIC in the Tang account overview. But when I open up the account, there is also a "Current Value" that notes my GIC is just over $1,000.
I was on the phone with a CSR to get the account set up as a joint account with Mrs. Rail Baron, and asked about this odd valuation of the GIC.
What I thought he said by way of explanation was that there is a 5 day hold on external funds in the account, and that one-fifth of the funds were released each day, which would explain the $1,000 ish value today, and that interest on the total transferred was calculated from the day the GIC is opened.
Since none of these funds are accessible for another 18 months, it really doesn't matter how the hold policy works, but did I correctly understand how the five day hold is pro-rated at Tang? I guess that could matter in a HISA. I've never come across such a prorated hold policy before.
8:19 pm
April 14, 2021
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I think that the amount 'released' or made available to you depends on different factors such as history and other deposits currently held. For example, I sometimes pull funds ($2000) into Tang and have about $500 of it released immediately, while the rest is not available until the end of the 5-day hold period. IIRC, I used to have all $2000 held for 5-days. Recently, I think that my credit limit has risen so that I have even more funds available, after pulling them into Tang.
My higher limit of availability may also be explained by the large GIC currently held by Tang. If I ever had a problem with the amount pulled into Tang, Tang would not hesitate to recover any potential losses from my GIC holdings. I believe that the term for this process is 'offset'.
10:17 pm
October 21, 2013
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I've not run into this kind of policy either, but I usually just assume it will take a week if pulled from another FI.
I have run into situations where a certain percentage is released immediately if you have a good credit rating etc, but the idea of a certain amount daily doesn't make any sense to me from the point of view of banking management. It seems to me that the reason they have a hold policy is to ensure a cheque or transfer has cleared. According to the banking industry, this takes X business days, usually about five. I don't see why it would take X minus one , two etc during that five day period. Either it has cleared or it hasn't.
Maybe it's just another instance of "cuteness" on the part of Tangerine - like their arbitrary promo handouts.
I guess you'll find out if it's true as the days pass.
3:36 am
March 30, 2017
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If u have $100k GIC with them and deposit another $20k etc, the entire $20k can be put into a new GIC right the way without hold.
It can be as high as 100% depends on history and asset with them.
5:16 am
September 30, 2017
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I think the holding policy only applies to the amount of funds leaving Tangerine, which is not the scenario described in #1. There are past discussions on the topic here.
Hope this helps.
12:40 pm
November 3, 2022
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I checked my account today, and the "current value" of my GIC remains just over $1000. I'm pretty sure that I misunderstood the explanation that I got from the Tang CSR last night.
It was unclear why they would put a hold limit on the funds in an 18 month GIC, but I suppose that I could always cancel the GIC and then try to extract funds. So maybe I could only get the $1,000 until the five day hold is up.
I'll report back after five days.
2:02 pm
April 14, 2021
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Rail Baron said
It was unclear why they would put a hold limit on the funds in an 18 month GIC, but I suppose that I could always cancel the GIC and then try to extract funds. So maybe I could only get the $1,000 until the five day hold is up.
Cancellation is exactly what could happen, within 30d, as I understand it.
The $1000 is probably your credit limit, as deemed by Tang.
2:17 pm
November 3, 2022
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HermanH said
Rail Baron said
It was unclear why they would put a hold limit on the funds in an 18 month GIC, but I suppose that I could always cancel the GIC and then try to extract funds. So maybe I could only get the $1,000 until the five day hold is up.Cancellation is exactly what could happen, within 30d, as I understand it.
The $1000 is probably your credit limit, as deemed by Tang.
If that's the case, I wonder how they came up with my $1,000 limit? I have had no more than $2 in my Tang savings account for at least a decade. In fact, I can't recall ever holding more than $1,000 in this bank until now.
2:27 pm
April 14, 2021
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I was once an RBC teller, 35 yrs ago. Every client would be assigned a code depending on their history/trustworthiness. That code determined how much you could draw from a deposit. If your balance was $0 and you deposited a cheque, your code might authorize you $0, $100, $500, or $1000. The bank is taking a risk that you might have deposited a blank piece of paper, but the code you are assigned is their estimation of the amount of risk they are willing to trust with you. With the new scanners, things may have changed, but a scanned bad cheque is just as worthless as a blank piece of paper.
They may be making your determination based upon your entire credit history from other sources, too.
6:06 pm
November 8, 2021
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Rail Baron said
If that's the case, I wonder how they came up with my $1,000 limit? I have had no more than $2 in my Tang savings account for at least a decade. In fact, I can't recall ever holding more than $1,000 in this bank until now.
HermanH might have a valid point. From my experience, the larger balance you have with Tang, the smaller is the amount on hold. Sometimes I had no holds on amounts pulled in from Tang. So for them it's like an "insurance policy" if the other bank does not clear the money. That is more true for customers who had no much dealing with them in the past, or just joining in.
8:40 am
November 3, 2022
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The full amount of my GIC is now showing in the account's "value" on Tang's web site. So there was a 5 business day hold on my funds, less a $1,000 amount that Tang has assigned to me as a credit cushion.
None of this really mattered with an 18 month GIC, unless I would have cancelled the certificate and tried to transfer my money elsewhere.
Please write your comments in the forum.