Toronto-Dominion Bank said “irregular” activities involving “bad actors” led the bank and partner Canada Post to the pause a new service offering loans to remote communities.
“While no TD customer information was compromised, we did elect to pause the program to investigate,” Amy Thompson, a spokesperson for the bank, said Saturday.
“It is disappointing that bad actors tried to take advantage of a new product meant to help Canadians, but we are pleased that our security monitoring worked quickly and hope to reopen applications as soon as we feel it is appropriate.”
On Friday, the bank said it had paused the program launched in October both online and in physical locations due to “processing” issues.
“Our processing was impacted when our security protocols identified early warning signs of irregular activities,” Thompson said Saturday in an email.
In October, Canada Post and TD said they were launching the national MyMoney Loan program “after an extensive market test confirmed strong consumer demand for more accessible lending products.”
The idea was to combine TD’s lending infrastructure and Canada Post’s physical locations in rural, remote and Indigenous communities.
Loans for $1,000 to $30,000 were to be offered, with fixed and variable interest rates ranging from around 10 to 20 per cent, according to Canada Post’s website — much higher than TD’s prime rate of 5.95 per cent, but lower than the typical interest on credit card balances.
The rate would be determined by factors including the term of the loan and the borrower’s credit history, and repayments could be spread over one to seven years, according to the website.
“Financial service is an essential service, and this alliance enables TD to play a meaningful role in helping to expand access to banking to more Canadians,” Michael Rhodes, group head of Canadian personal banking at TD, said in an Oct. 12 news release.
In the same release, Canada Post officials indicated that the postal service was “exploring additional financial products and services designed to meet the evolving banking needs of Canadians.”
Brick-and-mortar banking in remote or isolated communities is not entirely new in Canada. Royal Bank of Canada, for example, offers services in several Indigenous communities across the country through a combination of branches, commercial banking centres and agency banking outlets.