Relief for Small Business, Introducing the IPC Business Account

For the past four years, I have been invited to attend a local golf tournament hosted, in part, by a regional chapter of the Institute of Chartered Accountants of Ontario. As my golf partners would be happy to point out, I did not attend last week’s event solely to demonstrate my impeccable golf skills (or lack of), but rather, to hear and see if the financial industry is addressing the needs of small business owners, particularly as it pertains to commercial banking.

As I experienced in the past, this golf tournament proved to bear fruit once again. The heated discussion revolved around the fees and low interest rates associated with today’s business banking accounts.

Tired of the fees?
Ironically, each of my golf partners, which included: an accountant, a local food distributor and a young lawyer, informed me that they could pay anywhere from $8 to approximately $68 per month in fees to conduct basic banking transactions. These transaction fees can be paid as a flat monthly fee or you can pay as you go.

Want to earn more interest?
In addition to the fee structure imposed on many current accounts, my golf partners were not impressed with the low interest rates offered on these types of accounts. In some cases, large balances are held in the account to pay upcoming salaries or GST remittance. Currently, tiered interest rates earned on theses balances can be as low as 0% for balances below $5,000 to just over 1.5% for balances over $100,000.

What’s the solution?
Investment Planning Counsel recently launched the IPC Business Account. This new product is designed as an alternative, or as a supplement, to regular “current accounts” at banks and features lower service charges and greater rates of return. There are two interest rate tiers, one for balances $5,000 and over and a lower tier for balances under $5,000. Interest is calculated on the closing daily balance and is paid monthly. The rate on the lower tier is 1%. The rate on balances $5,000 and over is adjusted based on market conditions. Effective June 30th, 2003, this rate is 3.00%, but it may change without notice.

The fee schedule allows for a number of free transactions every month regardless of the minimum balance. The IPC Business Account allows you to write cheques, access cash from ABMs and pay bills over the Internet. Services are provided by B2B Trust, a subsidiary of Laurentian Bank of Canada and a member of Canada Deposit Insurance Corporation (CDIC). Some terms and conditions may apply.

See your Investment Planning Counsel Associate for more details.