Direct deposit


You will remember that when technology first made its appearance some 30 years ago, we were told that we would soon live in a paperless society. 

I have had a few conversations over the summer about this very issue. I have also had many suggestions about how our Government can reduce the cost of delivering services. 

One very good suggestion I have been asked to consider is the cost of and associated amount of paper used by the Federal (and the other levels of government) in producing cheques to Canadians. So I looked into it further. 

Did you know that the Government of Canada issues close to 275 million federal payments every year? While 79 per cent of these payments are currently deposited directly into bank accounts, 21 per cent are still printed as cheques that Canadian individuals and businesses must deposit at bank counters or ATMs. 

That translates into an astounding 58 million cheques that must be printed, mailed and processed each year. In addition, a physical cheque costs 82 cents to produce, while a direct deposit works out to about 13 cents to process. Once all costs are considered, taxpayers spend an incredible $17 million each year for this service. 

It is also why, beginning in 2014–2015, the federal government has decided to increase the use of direct deposit. 

As another plus, it’s environmentally friendly. While these are good reasons for us to adopt direct deposit, there are other compelling reasons as well.Direct deposit is fast and convenient. There is no need to make a special trip to deposit a cheque. Money is quickly deposited into an account and immediately available—no matter what you’re doing or where you are. In fact, if you receive more than one type of payment, for example both a Canada Pension Plan payment and an income tax refund, they can be deposited into different accounts of your choosing. Direct deposit is reliable and safe. 

Unlike cheques, there is virtually no risk of payments being lost, stolen or damaged. Your payment will never be delayed due to unforeseen circumstances. As soon as the payment is issued, it is deposited into the account of your choice and may immediately begin to earn interest. 

The federal government will be increasing the use of direct deposit and phasing out cheques by April 2016. But given the benefits, why wait? Visit  for more information and to fill out your enrolment form, or drop by any federal government office.

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