First-hand experiences shared by newcomers highlight the challenges of finding a solid financial footing
As Canada continues to rebuild from the impact of the pandemic, immigration will act as a key economic driver that can help address labour shortages and strengthen the social and economic fabric of our communities.
Scotiabank recently conducted research to better understand the experiences of newcomers as they move to Canada. This included in-depth interviews with newcomers and the financial advisors that serve them, to learn more about the unique challenges they face as they begin their life in Canada.
The research revealed that newcomers most commonly experience feeling worried, overwhelmed, and confused by their finances and navigating through the Canadian banking system.
High rental costs, getting the right documentation and identification, signing up for a mobile phone and credit card, and finding employment were identified as the common challenges shortly after arriving in Canada. The research revealed that lack of knowledge of the financial system and cultural norms exposed newcomers to financial fraud, targeting them for internet and phone scams.
The research also revealed that newcomers take a long-term view when it comes to achieving financial success in Canada.
“At Scotiabank, we want to help people new to Canada find their financial footing right from the start because the long-term financial success of Canada depends on it,” said Terri-Lee Weeks, Executive Vice President of Retail Customer at Scotiabank. “We know that newcomers often choose to come to Canada in the hopes of experiencing a better quality of life with access to greater opportunities. However, upon arrival, they continue to face challenges that can have a long-term impact on their lives as well as on the broader Canadian economy. We can help break down barriers by providing the right advice and expertise.”
The research found the top motivations for coming to Canada include seeking out a better quality of life and a better future, opportunities to grow a career in Canada, and reunify families. Scotiabank’s StartRight® Program provides targeted support to newcomers, from unlimited no-fee international money transfers and no-fee accounts for the first year to qualified and inclusive expertise from welcoming advisors across the country.
Based on the top 5 challenges of starting right in Canada, Scotiabank has the following general banking advice for newcomers wanting to set themselves up for success beyond the basics:
- Build up your financial literacy
The Canadian financial and banking system is vastly different from other countries. With a slew of new abbreviations and terminology to learn, newcomers can be confused by a seemingly complicated system. Newcomers interviewed identified concise and easy-to-digest explanations of Canadian banking terms as a positive factor in assisting them to become financially literate in Canada. Scotiabank’s StartRight® webpage has a selection of articles that can help new Canadians understand all facets of Canadian banking. Scotiabank advisors are also always on hand to answer any questions or provide further explanations of banking terminology in a variety of languages. - Know how credit products work and how to start building credit
A consistent source of frustration for newcomers to Canada experience is the roadblocks caused by a lack of Canadian credit score history. The approval process to obtain a credit card and start building a credit score can often be slow and cumbersome, with foreign workers often required to have a pay stub before being approved. Scotiabank’s StartRight® program allows you to be eligible for your first credit card with a limit of up to $15,000, without providing a credit history beforehand. This will help get you started on building your credit score immediately upon arrival in Canada. - Get access to online banking
Newcomers interviewed highlighted the need for extra assistance on how to effectively use and navigate banking tools such as the website and mobile app, make e-transfers, and utilize the online investing tools. Scotiabank has online tips to assist new customers in getting up to speed on online banking. - Look at the various credit card options that could be available to you
Lack of eligibility for premium credit cards was identified as another issue for newcomers to Canada. Despite having financial savings to cover their spending on the card, the required documents and immigration status meant that they were often limited to entry-level credit cards with minimal credit limits that were insufficient for initial expenses, especially for those arriving with a family. Scotiabank has a wide range of credit cards for newcomers, and a Scotiabank advisor can help you decide which one is right for you. - Beware of fraud
Newcomers to Canada are often looking for opportunities to generate income but can find themselves susceptible to incidents of fraud. It is important to be aware of how to recognize, reject and report the most common types of scams. Phishing scams see fraudsters impersonating government agencies, banks, communication providers or other companies send text messages to potential victims to lure them into providing personal or financial information that can be used to commit financial crimes. Mail and Loan scams offer the promise of a financial gain for an upfront fee but once that fee is paid, no money is given.