It’s probably not comfortable for the farmer who keeps his savings stuffed in the mattress.
But electronic investing and banking is a medium that perfectly fits the geographical reality of farming, proponents say.
“It works when it’s 40 below and your truck won’t start,” said Stuart McDowell, of CIBC in Saskatoon.
The communications revolution has given farmers power to bank through their home computer, and also buy and sell stocks and mutual funds.
Banks like CIBC, which owns discount brokerage firms, offer computer-controlled trading of a wide range of stocks and funds.
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Other firms, such as Fundnet Investment Corp. of Saskatoon, offer more specialized trading and advice.
Fundnet is a mutual fund management firm that uses the internet to keep clients tuned in to market developments.
Not only does its website (www.cutloss.com) offer a daily video newscast summing up mutual fund developments, but important news can be immediately e-mailed to all clients.
This is important, said president Jonathan Hunt, because markets can quickly change.
When a major crisis hits, as it did in Asia last year, most brokers will phone their clients if they feel action is needed. That’s good, Hunt said, but what happens if you’re not one of that broker’s most important clients?
“If the market is sinking like a stone, or going up like a rocket, do you want to hear two weeks later,” Hunt asked. “Do you really want to be the last on the list to receive the service?”
Apart from advisories on the market, clients can send buy and sell orders through e-mail and monitor their portfolios. This ensures orders get in fast and investors don’t have to wait for the broker’s telephone line to be open.
While many mutual fund gurus advise against buying and selling funds as the market fluctuates, Hunt said some investors want to have the ability to avoid losses and jump on a rising fund.
The internet and e-mail are not replacements for talking, he cautioned. He still chats regularly with his clients. But electronic options add extra services his company hopes will bring more investors his way.
It’s not a service for everyone. Hunt said clients need to have a minimum $50,000 investment account.
But farmers, who often don’t have the time to run down to their broker when they want to buy shares, e-mail investing can be a great thing.
Some of the biggest users of Fundnet’s internet site are farmers.
Hunt said he believes security is no more of a problem in computer trading than it is in any other method of investing.
“I consider it considerably safer than traditional business,” said Hunt.
He pointed out that criminals can always attack a system, but “even if we were hacked, what could they do?”
Controls within the mutual funds investing system minimize the risk of computer crime, Hunt said.
After all, any financial transaction carries some risk, he said. Giving a waiter your credit card is more risky than buying and selling mutual funds through the internet, Hunt said.
McDowell agreed hackers could break into bank and trading company computers, but the risk is minimal and the system has safeguards to ensure clients are not exposed.
For all its attractions, McDowell said he doubts electronic banking and trading will sweep the farming community.
“The uptake of electronic banking is following slowly behind the uptake of (internet-using) farmers in the rural areas,” he said. “The movement is happening, but it’s happening slowly.”
McDowell said young farmers are the most willing to use the internet. Older ones are less quick to embrace the technology, but eventually electronic finances will become an integral part of most farms, McDowell said.
“It’s coming. It’s a freight train that’s coming and we might as well all get aboard.”
