DESCRIPTION

This product will be attractive to those members who want a systematic, disciplined way of preserving their investment. DEPOSITWISE® Income Supplement Term Deposit will help members ensure they save funds to meet their goals, earn interest and allow them to draw out regular payments to supplement income.

TARGET AUDIENCE

There are three main target markets:

  • retirees
  • post-secondary students and/or their parents
  • people in receipt of larger sums of money (i.e. inheritance, sale of property, etc)

FEATURES

  • Term Length: 1-5 years
  • Minimum deposit: $4000
  • Payments: monthly, quarterly, semi- annually or annually
  • Payment direct to credit union account
  • Payment amount determined at time of investment
  • Payment amount fixed for term of investment
  • Non-registered funds only
  • Non-redeemable term deposit
  • Interest compounded annually
  • Only interest earned is taxable

KEY BENEFITS

Benefits to Credit Union:

  • Attractive investment for high value members who may have a large ‘investable’ asset base or ‘nest egg’.
  • Obtain funds which are easily matched off in terms of asset liability management (i.e. notional amount and payment schedule is determined at the time of the deposit)
  • Obtain funds that are essentially locked in at a known cost of funds over a long period of time.
  • In a low rate environment, the credit union will be effectively able to offer an alternative product to their members with a higher rate of return than a traditional redeemable term deposit
  • The credit union maintains a certain level of flexibility to meet members’ needs, while maintaining cash flow certainty for the credit union
  • Few competitors offer this type of product

Benefits to Members:

  • Scheduled payments to supplement income
  • Assist with living expenses at retirement or post-secondary education
  • Systematic way to manage your money
  • Flexible payment options
  • Easy access to the payments
  • Payments non-taxable
  • Earn more interest than in a savings account
  • Low minimum deposit
  • Provincial deposit guarantee applies