Learning Uruguay

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Banks and Cheques

Posted by urufish on November 2, 2007

 cheque.jpg

Yah. yah. yah… I could have written ‘checks’ but I felt like waving the Canadian flag today.  Besides that, it’s Uruguay and the Canadian spelling is closer to Spanish than the American spelling 🙂

 I’ve written a couple of articles on banks, but never on cheques per se.  Now that I’m entering my 2nd phase of Uruguayan experience, (an awakening of sorts to a 2nd level I hadn’t gleaned before), it’s time to share these new experiences with my readers. 

First and foremost, Uruguayan banks (those I’ve dealt with), are very, very different than Canadian or American banks.  The difference is fundamental.  Remember how we always say Uruguay is like the North 50 years ago… well, that’s very obvious in the banking system.  Although they appear to be modern, that’s superficial.  Under the hood, you’re looking at Canadian banking mentality from the 1950’s, (that’s from boyhood memory).  Paternal would be a good overall description to use to the way the public sees the banks. 

Most of my experience is with ABN, so the details below may not apply to all banks.  I’ve been told that most foreign banks operate this way.  The details below, (from my experience), dont apply to BROU. 

When you open an account, unless you’re with BROU, you jump through hoops.  Yes, there are several documents, but the real difference, (with ABN anyway), is you need references and you dont get chequing priviledges until you prove your worth.  I have to add here that although ABN seems strict, they’re downright liberal compared to HSBC.  We opened a savings account first.  We were ‘seconded’ by an old ABN customer.  We had a couple of friends also sign for us as character references. When the account was being completed I asked about chequing priviledges.  I was told that would have to wait until the bank got to know us better.  That took about a year. 

In the beginning we were non residents, so we didn’t really qualify for a credit card, but we could get one on a 2 to 1 basis.  For every thousand we put in an ABN instrument, we would be given 500 credit.  When we became residents, we were automatically given a U$S3K credit limit.  That has subsequently been raised to U$S5K by simply asking for it.  Like the BROU, we were given an ATM card immediately, even as non residents.  Nothing changed after we became residents. 

It’s worthy to stop here for a moment and distinguish between reisdency and citizenship.  My wife is a Uruguayan citizen, but she wasn’t a Uruguayan resident.  Because of that, it didn’t matter if the account was opened in her name (an option we considered), or not.  The residency rules still applied w.r.t. credit cards and chequing priviledges. 

A few weeks after we’d decided to stay on in Urugay, we walked into the bank and asked for cheques. Our rep checked our account, smiled and said they’d be pleased to advance us chequing priviledges.  Unlike Canada or the US, cheques are chargeable.  You pay for them.  You dont get fancy designs.  They take about 2-3 days to be printed.  You order them in multiples of 25. 

There are different kinds of cheques.  There are cheques for UYP and different cheques for USD.  These are coloured differently.   Peso cheques show the dollar sign as $.  USD cheques show the dollar sign as U$S.  Where you write the amount, the preceding verbage states, “La suma de Pesos Uruguayos’.  USD cheques use the verbage, “La suma de dolares U.S.A.’  Cheques are expensive, (compared to free up north).  At ABN, they’re U$S19 per 25. 

There are variations of the above too.  You can order the above as ‘crossed’ cheques.  These are called ‘cruzada’.  These have two diagonal stripes at the top left corner.  These cheques can ONLY be deposited into the bank account of the person (or business) name that appears on the cheque.  They’re considered safer.  There is a variation of these too.  Cheques to be cashed immediately and post-dated cheques.  Unlike up north, where we can post-date a cheque by simply writing in a later date, here that’s not allowed.  If you want to give someone a post dated cheque, you must a specially ordered cheque for that purpose.  Post dated cheques costU$S2 more per 25 cheques.  In total, that makes 8 kinds of cheques you can order.  People and business that write lots of cheques, keep all 8 types on hand. 

The cheque above is the common kind, not ‘cruzada’, in Pesos Uruguayos.  You fill in cheques a litle differently here than up north.  The MICR code at the bottom (the machine readable code), is very different.  You must put the place where you’re signing the cheque, similar to signing a contract up north.  In the above cheque it’s signed at Montevideo, the 2nd day of November, 2007.  This cheque is an experiment.  I’ve been told I have to write the entire month out or it will be returned.  I’ve decided to go with an abbreviation to see if this rule is applied or not.  Wish me luck. 

I do know the rule about writing the amount correctly is applied.  I’ve made a spelling mistake before on the amount and the cheque was denied.  If you make a mistake, you cant fix it by writing in the correct information and initialing it.  You must write on the back of the cheque, (in spanish), ‘I mean to say that the amount of Pesos Uruguayo should be….’  Then you sign under that with your full signature. 

They’re also very picky about the way you sign your signature.  As a person with multiple personalities, I have several signatures I use depending on who I am at the time of signing.  ABN reprimaneded me a few times about that.  When I explained that I was an undisciplined northerner, they offered to record all my signatures and keep them on file.  Because they were so gracious about it, I decided to compromise.  I write my ‘official’ signature on the back of each new cheque book as a reference and copy from that when I write cheques. 

Cheques clear very quickly here.  Uruguayans tend to deposit cheques same day, (or next day).  The system takes one day (my observation), to process.  That’s for local cheques.  If you deposit a foreign cheque, it takes 3-4 weeks for the funds to be released to your account.  That’s for cheques drawn on American banks.  For other countries, add a week. 

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13 Responses to “Banks and Cheques”

  1. straqnge said

    Have you considered Banco Republica instead of a foreign bank? It is so much easier than the foreign ones.

  2. Alejandro said

    “I write my ‘official’ signature on the back of each new cheque book as a reference and copy from that when I write cheques.”

    That’s probably not a good idea, if your checkbook is stolen you are providing a nice hint to the thieve to create a phony cheque and cash it before you can go through the process of notifying your bank. In addition, beware that thieves usually steal a single or just a couple of checks from the middle of your checkbook, you want to regularly check the sequence numbers (or keep your checkbooks in a safe location).

    BTW, great blog, as an uruguayan I enjoy reading it in order to figure out what we’re doing wrong (or, to find out if there’s anything we are doing right 🙂

  3. urufish said

    Yes, I’ve considered Banco Republica. As of this moment, my friends are still waiting on their decision to take our corporate account or not. I really cant remember how long it’s been… 2, 3, 4? weeks.. I hear the decision will come soon.

    When I went to BROU with some friends, to open their account, we asked about internet access. We were told it wasn’t working because of a disagreement between BROU and the software vendor. I would hope it’s working now.

    These kinds of events dont give me a good feeling about BROU. I’m still optimistic that there really is a ‘normal’ bank hiding in Uruguay somewhere. That may not be the case, but at least I still have hope 🙂

  4. urufish said

    Hola Alejandro.. First thing that needs to be cleared up. Uruguay does a lot of things right. That’s why a lot of foreigners are coming here. Unfortunately, it’s not a great country to make money in. But it has a quality of life that is rare on this planet. Any Uruguayan who has lived outside Uruguay knows this. Us foreigners lucky enough to have found this place know it too.
    In Canada, I had a lot of Chinese friends. They told me much the same story. They said Canada is not a place to make money. They make money in Hong Kong (now Shanghai too), and spend as much time in Canada as they can because the life is so much better compared to back in their home.

    I spent my life dealing with thieves and crooks.. I’ve seen every kind of burglary and theft and quite a bit of fraud too, so nothing they can do would bother me much. I dont consciously pay attention to keeping my cheques protected. They’re simply kept in a secure place. I’ve never kept blank cheques with me as a habit up north. I dont do it here. Truthfully, I hate to use them. Unfortuantely, I have two vendors that I need to write cheques to each month. I’m praying that one of them signs up for autodebit.

    For a northerner, the whole idea of protecting cheques seems surreal. Cheque theft in north america is still practiced, but the bank takes the hit.. never the customer. That’s another difference with Uruguyan banks. I get the feeling they couldn’t care less about negative publicity when it comes to protecting customers from fraud. We lost a couple of hundred bucks a couple of years ago on an ATM machine and no way the bank was going to give us the money back.

  5. Shirley said

    An expat friend here in Uruguay recently tried to cash a cheque that had been written to her (on a Uruguayan bank). The cheque was three weeks old, and the bank teller told her that it was no longer valid because the date on it was older than two weeks. There was nothing on the cheque to indicate that it would expire after a certain date; the teller told her it was a law that applied to all local cheques (don’t know about cheques written against foreign accounts). Has anyone successfully cashed or deposited a cheque older than two weeks?

  6. urufish said

    Ant told me the same thing.

    In fairness, there’s nothing on an Amnerican cheque that indicates it expires after 6 months–but it does.

    When you add everything up, it’s no wonder that most Uruguayans dont use or like cheques (Arrancopelito excepted :). Of course, the majority of Uruguyans, I’ve been told, dont have bank accounts. Sounds like the banks have a little work to do on public relations.

  7. Ant said

    Banks could go a hell of a long way with customer relations. First off… whats with “We are open only between 1 and 5 PM, Mon to Fri”?

    My bank gave me a faulty ATM card (It refused to dispense dollars). I had no idea what was wrong with it. Took me 2 visits to my branch on 18 de Julio. The lady there cut up my card and told my I could come pick a new one up next week. Next week, I get a card and does it work now? No. Same problem. One more visit later, they find that they have my card set up to my peso account (didn’t even know I had one!). I was asked to wait for 2 more days and finally, my card worked. I was in for a surprise because I find that my account was missing 4 USD and my peso account was credited with 20 pesos. It seems any re-issuance of a card would auto debit 70 pesos from my account. That I get. Any guesses as to what I have to do to get them to reverse the transaction?? Make another visit to 18 de Julio between 1 to 5 PM Mon to Fri.
    The lady on the helpline sounded so sweet that I didn’t feel like shouting at her. She gave me a complaint number and told me someone would call me in 2 days. That was 2 months ago.
    I’ve given up.

    BTW, the 6 month rule for cheques is also valid in India.

    Alejandro, I agree with urufish there. Uruguay does a lot of things right even when you compare life in North America. If it came to it, UY would be among my top destinations to settle down in. 🙂

  8. Harry said

    Urufish, it must be a long time since you’re tried to get cheques in Canada. Sorry to tell you this, but we’ve been paying for them for years.

  9. urufish said

    Harry, you are absolutely right. It’s been a long time since I bought cheques up north. Probably 6 or 7 years… And you’re right. I did pay for them… But, not to be a nitpicker, these are personalized that you’re talking about. Now I am sure that 99.9% of Canadians buy personalized cheques, BUT, if you’re determined not to pay for cheques, you can take a handful of counter cheques for free and write in your account number. I haven’t seen that done since I was in school, but I understand it is an option, for those of us with squeaky elbows 🙂 In Uruguay, at least at my bank, there is no such thing.

    As for American cheques, I had accounts in Providence and Vero Beach. I received checks (American spelling for American banks :)) and I cant recall paying for them. I think they were personalized, but not fancy.

  10. Harry said

    I’ll have to try that about counter cheques. I seem to remember asking for some a few years ago and getting about five. That would do.

  11. KOLLINS LAWRENCE said

    I WANT THE EMPTY PAPER OF THIS CHEQUE.

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  13. Joshua Kim said

    Your article is fantastic! You bring up valid points in an interesting way.

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