Review of CDIC Limits: Amongst Three Important Changes at the Bank

A comprehensive review of Canada's deposit insurance framework was announced in the February 11, 2014 budget.

The goal is to make sure that this fund, currently protecting savings of up to $100,000 per federally regulated institution, is enough to protect investors should a financial institution fail. The Canada Deposit Insurance Corporation (CDIC) oversees deposit insurance for its members which include banks and other financial institutions. Due to shifts in the global banking landscape and the financial crisis, this review has been found to be necessary.

Two other noteworthy changes in the budget documents:

Powers of Attorney –  The federal government will soon require enhanced disclosure by banks on the costs and benefits of using powers of attorney or joint accounts and more robust bank processes and staff training in this regard. The initiative is targeted at helping seniors who trust banks with these matters.

Enhancing Access to Basic Banking Services – The federal government has pledged to work with financial institutions to expand no-cost basic banking services for youths, students, and other vulnerable groups such as beneficiaries of a Registered Disability Savings Plan and what are deemed to be at-risk seniors. Several initiatives are targeted to improve awareness of the right to cash Government of Canada cheques free of charge at any bank in Canada. In addition, new standard language has been added to the back of government cheques for these purposes.