Monday, August 11, 2008

A bit about banks and banking

I thought I would write a bit about going to banks in Taiwan.

The first thing is about opening bank accounts. Usually businesses you work for will ask you to open an account with a bank of their choosing, usually as close as possible to the office. They do this because banks offer them deals to open multiple accounts. This is very different than in my native Canada where people have their pay deposited in their respective banks regardless of their name or location.

By the way, on an aside note, if you are free to choose a bank then there are a multitude of small and large banks to choose from in Taiwan. However, not all are in great financial shape. Of the top banks, I would recommend China Trust. Their service is fantastic, they are open later until 5pm instead of the regular 3:30 of most banks, they have a good financial advice section (I bought foreign mutual funds when other banks turned me down!) and they are efficient in their use of depositing bank machines. On the negative side, they didn't have safety deposit boxes free (all full they said) and they don't deal with a lot of foreign currency (I couldn't make Canadian travelers cheques there although American funds were ok. I went to ICBC and they had Canadian ones.).

Speaking of foreign exchange, here's a second thing I experienced recently. As I was planning a bit of travel and the exchange rates were decent, I decided to change some money. Being a month before my departure, I did not want to leave the money lying around the house. So I purchased traveler's cheques. Traveler's cheques are, as far as I can see, little used by Taiwanese. In fact, students have mentioned that they believe Taiwanese are easy targets for thieves when compared to foreigners for the very reason that they carry cash on them. This makes sense. So it makes you wonder why they don't think of using traveler's cheques. It may have to do with older people's mistrust of them or for the general reason that they are not convenient for Taiwanese. In Asia they usually need to be changed at banks as local merchants don't recognize them (apart from perhaps hotels).

The thing that stunned me the most when I purchased my cheques they did not ask me to sign them on the spot. Although I am not too sure why this happens (the cheques themselves have a message on them to sign upon receiving) I assume that the Taiwanese use the cheques as a way to send money to people by mail. A foreign friend of mine told me something about this.

Here's how it works. You want to send money overseas. You buy the cheques and do not sign them. You put them in a letter and send them overseas. If they are lost, you call the company and have them replaced (remember you keep the receipt for the cheques with the series numbers on it in case of theft). Otherwise, when they reach their destination, the receiver signs them and countersigns them and voila the money is transferred.

Just so you know, if you decide to get traveler's cheques like a good Westerner should, there may be some fees involved. The bank I went to gave US fund cheques no charge. CAD required a one time fee of $100 no matter how much money is changed. And remember to sign at least once before cashing the cheques. Some banks won't even cash them if they see the cheques were not initially signed. Finally, although you may get away with no charge on the purchasing end, there may be bank fees on the selling end.

So there you have it. If you have any other bank stories about depositing, withdrawing, wiring money, getting a safety deposit box or whatever, drop me a line.

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