WELCOME TO CANADA – ARE YOU IN DEBT YET?
Canadian banks are aggressively targeting new immigrants to Canada:
We are all seeing the advertisements whether it is Scotia Bank’s “StartRight”, HSBC’s “Newcomers” and so on…
In each case the banks are aggressively going after new immigrants with offers of credit cards and other forms of credit. The offers usually involve credit cards with lower limits to get them started.
But why target people from countries that have little experience with credit and debt?
The answer is complex and multi layered but among the reasons that this population group has become such a prime target are the facts that there are lot of them, about 80,000 per year, and most have little if any other debts.
Other reasons include banks obtaining access to multiple layers of fees, from credit cards to bank accounts and cross sales to other service lines such as mortgages and insurance policies. Of course there are a significant number of wealthy immigrants and they are prime targets for financial services.
Unfortunately for some segments of the immigrant population they not only come with a naivet of credit but also a fear of insolvency proceedings. In some countries failing to pay debts can still result in prison sentences. This fact can instill a tremendous sense of fear in some immigrants who may forego eating to pay debts. Some are fearful of being sent back to their country of origin should they fail to pay their debts or file for bankruptcy.