Helping newcomers

This demographic’s numbers, however, are growing. Averaging about 250,000 annually over the past decade, newcomers arrive in Canada from more than 175 countries each year. Immigrants from Asia _ primarily from the Philippines, India and China _ have accounted for roughly half of all newcomers since 2000. Immigrants from Africa and the Middle East represented just more than 20% of newcomers; Europeans were more than 15%; and South and Central Americans, about 10%.

Ontario, the province of choice for about 40% of newcomers to Canada, offers the most potential for advisors looking to enter this market; followed by Quebec, with 20%; and British Columbia and Alberta, which together attract slightly more than 25% of all newcomers.

But locating a cluster of newcomers won’t automatically lead to opportunities for advisors. Given the diversity of Canada’s recent immigrants, it’s crucial to identify a particular community that is right for you. “You have to be selective in choosing groups that you will be comfortable working with,” says Raymond Yates, financial advisor and senior partner with Save Right Financial Inc. in Mississauga, Ont.

Even then, the task of reaching out to the newly arrived is made even more challenging because an estimated 40% of newcomers rely on the advice of friends and family once they have arrived, says Paul Sy, director of multicultural banking with Royal Bank of Canada (RBC) in Toronto. To help, RBC has developed an internal network that helps to steer newcomers in the right direction when they do come into the bank.

There are a variety of ways to identify and then connect with newcomers. Rhowena Adolfo, director, Oshawa-Whitby division, and consultant with Investors Group Inc. in Whitby, Ont., makes it a point to attend events that are likely to attract newcomers. These include what she calls “high-volume” community-based events, such as those held by cultural groups. Adolfo also hosts financial workshops and seminars in collaboration with non-profit organizations that support newcomers and gets involved with groups that assist women who are newcomers.

The objective, Adolfo says, is to build trust and confidence by demonstrating that she has newcomer clients’ best interests in mind _ without pushing any particular product.

Yates takes a similar approach, working with community-based, often quasi-governmental organizations and selected immigration consultants. He, like Adolfo, says that educating newcomers is critical to building all-important trust and removing fears about investing and insurance products.

The theme of breaking down barriers that naturally arise in a new environment is a common one. Eric Liu, a financial advisor with Edward Jones in Vancouver, works mainly with Chinese newcomers. As Liu puts it: “You have to do a lot of work to break the ice.”

In addition to participating in various community events, workshops and seminars, Liu joins forces with other advisors to host periodic lunches and dinners to which he invites friends, clients and their acquaintances. Liu says this is very effective in building confidence among newcomers who are used to seeking the services of banks, which they view as solid and stable. Liu steers clear of direct advertising, which, he says, is not effective with newcomers.

Liu also uses centres of influence such as lawyers and accountants to obtain referrals to newcomers. These contacts are especially helpful when it comes to dealing with the subgroup of newcomers who arrive in Canada under the federal government’s Business Immigration Program. These high networth business owners, investors and entrepreneurs are a sophisticated group, often with a range of international connections. This group is one of the hardest to crack because such newcomers generally have extensive financial networks. But this group also can be among the most lucrative.

Language barriers, of course, sometimes exist, but that is not as much of a hurdle as is sometimes thought. Many newcomers speak at least some English _ or at least one member of a family will have language skills, says Pankaj Mehra, director of India, South Asia and the Philippines markets with Bank of Nova Scotia in Toronto. And if these clients don’t, Scotiabank offers services in some 90 languages.

Adolfo addresses the language barrier by “piggybacking with some other consultant who speaks the relevant language,” while Cantonese-speaking Liu has also learned Mandarin.

Adolfo has built a reputation in immigrant communities by publishing newspaper articles that are widely distributed through restaurants and grocery stores. She describes her approach as opening newcomers’ “eyes in ways they can understand _ no jargon, no abbreviations.” This sets the tone, Adolfo adds, for a “real conversation about trust.”

Liu echoes the message that you need to build the same kind of bridges with newcomers that you already have with your other clients. “You have to understand the culture of the newcomers you are dealing with,” advises Liu. “I tell stories and relate them to something at home.”

Coming in the Mid-October issue: stories from advisors who specialize in serving newcomers.

© 2012 Investment Executive. All rights reserved.