March 7, 2018

How To Bring Money Into Canada – the Indian perspective

How To Bring Money Into Canada – the Indian perspective
credit #Tridz (Trideb Banerjee)

I prepared this brief after visiting many banks (HDFC, ICICI, Axis, SBI, BOI, KOTAK, and some more) here in India and emailing/speaking with many bank representatives from Canada (TD, Tangerine, CIBC, SCOTIA, RBC, BMO). After careful consideration, this is what I think I am going to do, keeping two things in mind – have minimal currency loss in the whole process AND have access to my entire PoF (15 k CAD) at the earliest in Canada upon arrival._
Open a chequing account with CIBC (online from India) before arrival. I get (ONE) year free chequing account + 6% cash-back debit card + $500~$1000/mo credit card.
Using wire transfer from my bank – I deposit about 90% of my PoF money (CAD 13K), ie INR 690,315+ 1.5k GST + 1k bank fee (from my banker’s foreign remittance, ie. HDFC), I know HDFC’s forex rate (wire transfer rate: 53.0411+GST approx. Rs. 1.5k + Bank Fee: Rs.1k) sucks, but I cannot do anything else. Why? Read – till the end.

The wired amount will take max 2 days from HDFC to clear an additional 3 ~5 days from CIBC to accept (CIBC will deduct C$15 from that wired money on account of an incoming fee, apart from that no additional fee)
Once the amount is deposited, I receive a balance certificate from CIBC, that if asked by the immigration officer – I can show to validate my settlement funds + the cash I am carrying.
Buy Forex (Canadian Dollars from IndusInd: rate 53.3585) approx. C$ 2,000 (INR 1,06,717 + GST Tax). Unfortunately buying CAD in cash from my banker, ie. HDFC is a very expensive rate: 54.8599. Furthermore, BookMyForex does not have a service in my city – Jamshedpur. In case, you live in a metro, or Tier 1 or 2 city, please check BookMyForex – you can buy CAD in cash at a very competitive rate of 52.2088 as of today, OR KotakRemitt (rate: 52.2014) and if you have an account with SBI – look no further (SBI rate of CAD cash = 51.4754)

Arrive in Toronto – activate the CIBC account by visiting the branch. Activation takes less than 1 hr and I walk out with that 6% cash-back debit card. I have full access to that fund. If I am carrying any CAD in cash, I can deposit the same (no service fee charged for that). CIBC has a fairly wide presence of ATMs in Toronto.
Once I have my PR card (90 days), or any other photo-ID proof/address proof (like a rent lease, etc within the first month upon arrival.) – I open a savings account, chequing + credit card at Tangerine. The best part of Tangerine is it’s no-fee for life, and I earn interest on my chequing account too in addition to the funds in the savings account. I have access to the Scotia network of ATMs when am with Tangerine. So, now along with CIBC ATMs, I have access to the Scotia ATMs too.
After the first (one-year free chequing account) is over with CIBC I close that account and move my otherwise left small part at CIBC also into Tangerine; but, that’s future – will decide when ‘that’ day comes.

Few words of humble advice while selecting foreign currency mode:_
Money exchangers/other banks where you don’t have an account may be willing to offer Wire Transfer at less rates, please don’t fall into that trap. As it won’t be successfully delivered to your new account in Canada as we are moving there as an immigrant. In that case, the money will be sent back to the issuer/issuing banker, ie. BookMyForex (Axis Bank’s dummy account in your name) or IndusInd’s dummy account or Kotak’s dummy account. That’s another hassle in getting that money back via demand draft (in reality up to 1 month). So, don’t even take that route, no matter even their Branch Head assures successful delivery. (CIBC, TD, RBC, and Scotia have specifically said – they won’t accept wires unless it is from your own account, and there’s no exception to this rule for a new immigrant for first-time incoming money).

For wiring the balance PoF you may use your own bank where you have your account maintained for the past year or so OR the same account that you chose to show for your PoF proof in e-APR.
The feature of wire transfer from BookMyForex/Kotak/IndusInd works only in case of family maintenance OR education, then the new Canada bank will accept from a close family relative. But, as our VISA has the word ‘immigrant’ printed, the wire will be sent back to the issuing authority in India.
Priority while selecting cash buying must be first SBI >>> BookMyForex >>>IndusInd >>>Kotak Remit and, if nothing is available then buy from your own bank at a high rate). As per Indian laws in Forex, you will not be allowed to buy more than CAD 3,750 per person. Even the top bank management is not going to listen to you if you chant the FEMA laws to him/her. Check the overall rate of CAD cash before buying. Your bank may have some markup with them when negotiating the forex in cash. You may be lucky to have cash at a competitive rate. Refrain from buying CAD in cash in high amounts, as currency notes are expensive than Forex Card or Wire Transfer rates; unless you specifically need cash in a high amount right upon arrival.

Do not take TCs/DDs as they take 25~30 business days (6~8 wks in reality) to clear by the new bank in Canada. You may have to either take a cash loan from a friend or relative in Canada for the first month, should you choose to take TCs/DDs.
Even if you take a Forex card; the issuing bank in India has no limits on POS machines (debit card swipe) but has limitations for ATM withdrawals (only 2-3 free/mo). Canadian banks have very few withdrawal limits at one go, ie, C$500~C$800 per ATM withdrawal. And, once you are past that free withdrawal limit, the new ATM bank will levy C$3~C$10 per ATM cash withdraw. So, load up a Forex card, only if you need to buy some duty-free stuff at a layover city/airport (via multi-currency forex card) or buy a phone upfront on the first day itself using Forex, even before visiting the bank in Canada.
You may choose Scotia too while opening an account from India, they have a similar newcomer program like CIBC.

I don’t have an SBI account. I am with HDFC here in India. But, I am too tempted to get the SBI forex rates. Even if I wanted to create an SBI account, I can do that. But, I am not allowed forex buying/selling until I complete one year with SBI. So, that option is ruled out.

Apologies for the long post, someone earlier anticipated this as a thesis. Haha haha haha. I have tried to detail out everything here, so that it’s easier to know the why, how and what of the whole process. I hope this helps. Also, if I am going wrong anywhere – please feel free to highlight my mistake and correct me on this research.

By: Trideb

other useful links

CIBC
settlement.org
CBSA