banking

Establishing an account is fairly easy. You need your passport, a letter from you bank in Canada stating that you are a reliable customer, and a person in the DR to sign as your sponser. This person needs to have a Cedula, which is a Dominican ID card, and can be either antoher expat or a Dominican.  I am not sure where in the DR you are but here on the north coast in the sosua/cabarete area most of the expats us Banco Santa Cruz.
Let me know if you need more info.

Bob K

I will be retiring to the DR. around the 15th of Oct 2013.I just finished reading the horror stories on banking in the DR. I am thinking of just leaving my money in my US bank and just using my debit card and credit cards (Chase, Citibank, Discover, etc)and paying the bill with online banking. Will this work and if not, what are the drawbacks?

Oh yeah,one more question...... are personal checks from my US account pretty easy to cash!

Hard sometimes to pay Dominican bills online and if you do you will need a Dominican Account to pay from.  Most here have a small bank account with no problems. We have had two here (one USD and one Peso) for 9 years and no problems. Remember to keep the total amount in accounts to under $10,000 US or will be reported to the IRS in the states. In fact we also have a Dominican Credit card (VISA) and use it regularly again with no problems. Once someone got the number and tried to charge something and our bank here caught it, stopped the transaction, canceled the card and had a replacement for me in 24 hours.

Many folks, my self included, use ATMs for cash or change dollars for pesos to live on. With a Bank of America debit card there are no transaction or exchange fees if  you use Scotia bank here.

Almost NO one will take a personal check from the US.  In fact most places including your bank will put a 30-45 day (and that is working days) hold on your money. So if you deposit it in a bank it can be up to 6 weeks before you get your money. Wire transfers work right away.

Hope this answers some of your questions. Let me know if you need more info.

Bob K

Bob gave you great info.  I have had accounts here in DR banks for 10 years, only once ever had an issue and it was resolved.

It is a nightmare to get a check cashed so don't bother.  Set up a wire  transfer from US bank to DR bank, make it an odd amount and do it once in a while to top up your local account. You can use your US cards at bank machines here - make sure you understand your bank charges ahead of time

To open a bank account here you need a reference letter from your bank or banks in the USA that you are a client in good standing etc etc.  You may also need someone here with an account to vouch for you - kind of a personal reference but they sign nothing.

What area are you coming to???? Sorry I am sure you have told us but I cannot remember.

Thanks for the info, it was very informative. We will be comming from New Orleans. We're leaving here next week. Going to my native state of Maine for a couple of weeks to visit my son, then we will be arriving in the DR. around the 15th of oct. Will be staying in mostly Santo Domingo while our house is being built in Las Galeras.

Next time I'll check my spelling ....Lol

Well welcome to the DR and let us know if you need any other information.
Are you retiring here?

Bob K

I am in Santo Domingo, make sure to contact me so we can meet for coffee!!!

On the subject of Banking, here are my recommendations to expats about Dominican credit cards:

1) If you can do without them, avoid them like the plague.

2) If you hear about an 7% to 9% interest rate, don't make the mistake of thinking it is an annual rate, for it is actually a monthly rate equivalent to 84% - 108% per annum! In addition, they slap a 5% commission on you for every cash withdrawal you make.

3) If you decide to get one, do shop around for the best rates and terms; the local newspapers often publish comparative analyses of credit card costs.

4) Choose an issuer that offers you a complementary revolving line of credit for larger purchases (usually after 6 months of problem-free usage of your basic card); the limit can match or even double the limit on the basic card, the interest rate and cash withdrawal commissions are about half of what they charge on the basic card, and you have the option of spreading payments over a longer period (up to 5 years in some banks).

5) Don't carry a monthly balance on the basic card because that's where they get you with these exorbitant interest rates. If you're unable to pay the full amount monthly, carry over the difference into the line of credit, where interest rates can be between 33%-48% p.a. Pay off the line of credit as soon as you can.

6) Worst case, if the balance on your line of credit keeps growing out of control, refinance the line of credit with a personal consolidation loan in which interest rates typically range between 18-24% p.a. depending on whether you put up collateral or not.

7) If you have an issue with your bank, file a written claim, they have 30 days to resolve it to your satisfaction; if this doesn't happen, elevate your claim to the consumer affairs agency of the Banks Superintendence (at Unicentro Plaza, corner of 27 de Febrero and Lincoln streets in Santo Domingo) and as a last resort, to ProConsumidor. Sometimes issues get resolved, sometimes not. If there's not a big amount involved, don't waste your time as this can go on for months and months.

Advice from a former banker. Hope this helps.

Yup, you got me convinced, no DR credit cards for me! Thanks for the info!

Dominican issues credit cards are unbelievable. the rates are scandalous.

And as an expat you cannot get one without a cedula.

I don't think many banks offer expats a line of credit,  mortgages are very difficult to get and very expensive as well.

I always recommend expats do their financing from their previous country if at all possible.

I use a Visa debit card issued by Scotia Bank,  with the money in my account I can use it for online transactions, renting cars, reserving hotels etc.  Its a bit of a pain though when it comes to getting a credit back or a refund of a deposit.  We are used to things happening quickly and easily, not is quick or often easy here.

Be very very careful of these things!  they can come back to bite you in the butt.

And thanks for the very informative post, I did not know about number 7.

I have a Dominican Credit Card (visa) and I use it all the time with out any problems. I do not carry a balance but pay it off every month and never had paid an interest fee. I do believe that there is a fee of about $35 a year for the card.
It also accumulated points for purchases and about once a year I end up with  a couple thousand points which translate into pesos and I use that to pay off the balance.

Bob K

thanks Bob, which bank???

Banco Santa Cruz.  Here in Sosua they seem to cater to expats. Great service and easy bank to work with.

Bob K

Awesome Bob, I've never heard anyone say anything either way about that bank. I will check them out here in Santo Domingo

Great info folks. But why would you need two accounts, one in peso and one in dollars, at the same bank? I heard tell that a Capital One credit card is also good for something or other.....less fees?

I have both peso and dollar so I have access to both depending on my needs. Also easier to transfer money into a dollar account from the US.
I don't know about a Capital One Credit card as I don't use one.

Bob K

We don't have that particular credit card here but of course you can use it here.

Many of us have both a Dollar account and a Peso account, just makes life easier and it spreads exchange rate risk - if that is important to you.  I receive some of my consulting fees in US dollars and some in pesos so I must have 2 accounts.

By the way - some peso accounts will accept US dollar wire transfers but you get kicked by the exchange rate.

So what your saying is that when I transfer funds from my US bank,I should put it in a dollar account?

For me - I would transfer dollar account to dollar account, then as needed you can withdraw dollars or on the bank website transfer dollars to your peso account,  triggering an exchange rate. But at least you have an option this way.  YOu can go to the bank, take out dollars,  exchange where you want to.

For some people that difference in exchange rates doesn't warrant the hassle, for others it does.

But yes it is far better to wire dollar to dollar account.

Yes much easier transferring Dollar to Dollar account and then exchange as you need to.

Bob K

Hi planner.
Curious as to your consulting. Are your services pertinent to expats, DR individuals or business? Thanks.

All of the above but not taking on clients, I am just too busy right now. If I can help on here, I will.

Super informative thread, thanks for your input guys (and lady Planner  )

Now I have 2 more questions.

1. In my town we have Banco Popular (ATM only, nearest branch in Cabarete) and BanReservas (ATM + branch). I wonder which one I should pick. I noticed that BanReservas has more ATMs in public places such as the airport, but at the end of the day I'd go with the best of both in terms of service and reliability.

2. I heard about interest rates on savings that are apparently quite interesting here in DR. How safe is it to deposit money here (larger sums)?

Both Popular and Reservas are good.  It really comes down to personal preference.  Reservas is owned by the gov't and Popular is not.   Not sure which if either is better.

I do my business banking and payrolling with Reserva and find the  service excellent!

How safe is investing?  Same rules apply here as elsewhere,  diversify,  don't put eggs in one basket, measure risk,  don't chase rates of return without considering the rest. AND remember you will deal with  not only interest but also exchange rate differentials!   Better rates for US deposits.

I think Popular is more popular (sorry about the pun) with expats and you will find more of them around the country than Reserva

BObK

Good evening everyone

I personally recommend BanReservas for many reasons, the customer service is amazing, the guaranties and the security in your investments and accounts it offers are the best. Due that the Bank is gov. owned, it offers more guaranties than any other bank in the Island.

For the only reason I would consider Scotiabank is if you have a credit card with them emitted in Canada, and need to do an urgent withdrawal, you will only get charged for the cash advance fee wish is pennies. Other than that, I won't recommend it.

Good luck with that.

Sorry Planner, not sure what you mean by "all of the above". Can you clarify? Thank you.

Sorry, my services are pertinent to expats, locals, businesses and government.....   It all depends what I am doing for any person or group.  I've done work with all the different groups and businesses.

But, like I said, no real time right now. I am not taking on new clients. I am working  5 am to  9 or 10 pm every day at the moment......

Happy to answer questions here whenever I can.

If I'm reading this right, if I have my no fee ATM card and no fee CC, I do not have to have a bank account?  Is it a residency requirement?

Also, do  ATM's only dispense pesos?

A bank account here is not a requirement of residencia.

Yes they only dispense pesos.  Sorry.

Not only pesos but the limit per transaction is usually $10,000RD or about $220 dollars. The local banks and ATMs will charge you a fee per transaction no matter what card you have unless it is their credit card and you use the ATM at that bank.
I do use my no fee US credit card for most purchase at the supermarkets, and big ticket items.

Bob K

We're BOA customers in the US and have been using Scotiabank ATMs here on SXM for years with no fees so it's great to know that's an option.  We only have a local bank account because it is required.

It seems as a resident you would have no use for US$??  Now I understand why you have two accounts Bob.

We too use BOA and even though Scotia bank is part of their world wide network Scotia bank here DOES charge a bank fee (about $3 I think) but not sure of he amount as I stopped using the ATM when that was instituted about a year ago.  No just use our BOA card when traveling  elsewhere.

Bob K

Hmmmmm.  That will be fine for a visit, but for long term would have to do more research.  Thanks again.

We just write a check into our DR bank (US dollar account)  when we  need an infusion.  Usually a 4-6 month expense amount and don't worry about the ATMs. You can also wire  money but that again creates a fee and many times on both ends of the wire

BObK