14 Best Online Banks in Canada

14 Best Online Banks in Canada

Are you searching for the best online banks in Canada to manage your money from the comfort of your home? Search no more because we have done the difficult work for you!

The best online banks in Canada offer high interest rates, low fees, and 24/7 accessibility. Whether it’s Achieva Financial’s no-fee structure, Motive Financial’s high interest rates or Oaken’s reliable customer service, each has unique advantages.

Despite certain downsides like limited physical presence or narrower product ranges, the convenience and savings potential of online banking are hard to overlook.

Online banking is an increasingly popular choice due to its convenience, high interest rates, and low fees. However, choosing the most suitable product can become complex with the abundance of options.

Our list shows the best 13 online banks in Canada. It helps you choose wisely for your finances with detailed information.

Best online banks in Canada

Suppose you’re a person who wants to handle money better or a business needing flexible banking. In that case, there’s a perfect bank for you. Here are some of the best online banks in Canada.

1. Tangerine

Tangerine is one of the best online banks in Canada, with over 2 million customers and nearly $40 billion in money they look after. This bank is a part of Scotiabank and was launched in 2014.

Many people enjoy using Tangerine because they don’t ask for money every month for their checking and savings accounts. You can use your checking account for free as much as you want.

They also give you the first bunch of checks without making you pay. You can use 3,500 ATMs in Canada and 44,000 worldwide. They even give out loans and help with mortgages, which not all online banks offer.

Instead of traditional bank branches, Tangerine has created “cafes” in big cities like Toronto, Vancouver, Calgary, and Montreal.

These are places where you can learn more about what Tangerine offers and get advice about your money over a coffee. Tangerine provides an excellent mobile application designed for both iPhone and Android users.

Pros of Tangerine

  • Safe checking account in Canada, supported by Scotiabank.
  • You can deposit cash and cheques.
  • Access to 44,000 ATMs worldwide at no cost.
  • Provides two types of credit cards
  • You earn 0.1% interest on your checking account or 1% interest on your savings account.

Cons of Tangerine

  • Interac e-Transfer, available for international transfers, is not the most affordable.
  • High 2.5% fee for transactions in foreign currencies.
  • Free use of Scotiabank ATMs, but they can be harder to locate.

2. EQ Bank

EQ Bank started in 2016, but it’s part of a company called Equitable Bank that’s been around since 1970. Unlike traditional banks, EQ Bank only operates online – no physical branches exist.

They provide a hybrid account that merges checking and savings accounts’ characteristics. So, you can use it to pay bills and transfer money, but you also earn an excellent interest rate of between 1.25% and 2% on the money in your account.

EQ Bank has partnered with Wise to help customers send money to other countries quickly and cheaply. This online bank does not charge any hidden fees.

EQ Bank, one of the best online banks in Canada, offers no foreign exchange fees or monthly fees. They also have a handy app that you can use on your iPhone or Android phone, making it easy to manage your money wherever you are.

Pros of EQ Bank

  • Online savings account with high interest rates.
  • Connect your EQ Bank account to your main Equitable Bank account.
  • Electronic fund transfers are free.
  • Affordable international money transfers.
  • No requirement to maintain a minimum balance in your account.
  • Available across Canada.
  • Top-notch mobile app.

Cons of EQ Bank

  • No chequing account or credit card available.
  • No physical debit card or access to ATMs.
  • Might have to wait longer for customer service due to a smaller team.
  • Business accounts aren’t offered.

3. Simplii Financial

Simplii Financial, an online banking platform, is a division of CIBC that provides a comprehensive range of banking services. They offer many different banking services, such as fee-free checking and savings accounts, credit cards and mortgages, all in one place.

You get a debit card when you open a chequing account with Simplii Financial. You can use this card to take out money for free from 4,000 CIBC cash machines across Canada. Additionally, you can use the card to shop online or in stores.

In addition to regular banking services, Simplii Financial also offers loans and cashback visas to eligible Canadians. Even though their smartphone app is quite basic, customers say it’s easy to use. You can get the app on your Android or iPhone and use it to do your banking from anywhere you are.

Pros of Simplii Financial

  • Chequing account with no fees and savings account that earns interest.
  • Credit cards with cashback rewards.
  • Access to personal loans.
  • Low interest rates for mortgages, credit cards, and mutual funds.
  • Great sign-up bonus.
  • No minimum deposit requirement.

Cons of Simplii Financial

  • No physical bank locations.
  • Interest rates are not the highest.
  • Customer service could be better.

4. Koho

Koho, ranked among the best online banks in Canada, provides a mobile application and a reloadable Visa card. This app can give you helpful information about your spending to help you manage your money better.

They’ve teamed up with Mastercard to provide the KOHO Prepaid credit card. The KOHO card is a prepaid card. It resembles a debit card rather than a typical credit card, as you aren’t required to pay interest on your expenditures.

Paying ahead can also improve your credit history and boost your credit score by showing you’re responsible with money.

The basic plan has no monthly fees, and you don’t have to pay for everyday transactions. You can also get 1% cash back when you buy groceries or use public transportation and even more cash back at specific partner stores.

Koho also offers three other plans: Essential, Extra, and Everything. They do have monthly fees, but you can get more cashback. The KOHO app has a helpful tool named RoundUp. It adds up your costs to the nearest dollar and saves the leftover change, which can grow your savings.

Pros of KOHO

  • An account option with no cost
  • Variety of card designs to choose from
  • Offers cash back on purchases
  • Helps build your credit score
  • Withdrawals from ATMs are free of charge
  • Zero-interest overdrafts

Cons of KOHO

  • Slow customer service responses
  • 1.5% fee for foreign transactions on a free account
  • Only a small number of retailers provide 5% cash back
  • Credit-building services come with a $10 fee

5. Scotiabank

Scotiabank, established in 1831, is one of Canada’s largest and oldest banks. They’ve created a Scotia Online system.

Through Scotia Online, you can sign up for and access different banking services from your computer. This includes chequing and savings accounts, credit cards, and investment accounts.

These banking services are packed with features and are easy to use. However, you may have to pay $3.95 to $30.95 monthly if your account doesn’t have enough money.

Scotiabank doesn’t ask students and account holders with a certain minimum balance to pay monthly fees, giving them a discount. Senior citizens also get a discount on their fees.

One great thing about Scotiabank, one of the best online banks in Canada, is that they can quickly open an account for you. Plus, they have a well-rated mobile app you can use to do your banking from your phone.

Pros of Scotiabank

  • Scotiabank frequently offers attractive promotions.
  • Offers various services, including daily banking, credit cards, and investments.
  • Provides a substantial welcome bonus.
  • No fee for premium credit cards.

Cons of Scotiabank

  • You must maintain at least $5000 in your chequing account for no fees.
  • Lower HISA interest rates than EQ Bank.
  • To get the most benefits, sign up for several services.

6. CIBC Online

Founded in 1961, the Canadian Imperial Bank of Commerce (CIBC) is the first choice for seniors regarding online banking in Canada. Its robust online platform provides real-time fraud alerts and the convenience of mobile cheque deposits.

For those who love to travel, CIBC makes it convenient to order foreign currency online and deliver it straight to your home. Additionally, those under 25 years of age can benefit from free banking services with the Smart™ Start program.

CIBC, considered among the best online banks in Canada, offers no-fee banking to those with a minimum balance of $4,000. However, it’s worth noting that they usually impose transaction fees.

Pros of CIBC

  • Top-rated Canadian banking app in 2019
  • Broad range of personal accounts
  • Tailored solutions for seniors, youth, and newcomers.

Cons of CIBC

  • Savings products have less competitive interest rates
  • Most accounts come with transaction and account fees
  • Transfer fees are more than average
  • Offers fewer options compared to other banks.

7. Neo Financial

Neo Financial is a new digital bank in Canada that started in 2019. They have different products like Neo Money, Neo Invest, and Neo Credit to help you with your money.

One of the notable offerings is their hybrid bank account, which merges the benefits of a chequing and savings account. This account pays you 2.25% interest on your money and has no monthly or yearly fees to worry about.

You don’t need to worry about maintaining a minimum balance when banking with Neo Financial, one of the best online banks in Canada. Additionally, they provide the convenience of complimentary Interac e-transfers, debit transactions, and bill payments.

Upon opening an account, you’ll also receive a Neo Money Card. This is a prepaid Mastercard that you can use anywhere that accepts Mastercard. It’s free and linked to your account. Besides the Neo Money Card, Neo Financial has two types of credit cards that you can apply for.

Pros of Neo Financial

  • Free transactions with no limit.
  • No need to maintain a minimum balance.
  • Free of monthly charges.
  • High-interest earnings on savings accounts.

Cons of Neo Financial

  • No insurance benefits with the Neo Card.
  • High purchase APR of up to 26.99% with the Neo Card for poor credit scores.
  • Mobile cheque deposits aren’t supported by the Neo Money account.

8. Royal Bank of Canada Online

The Royal Bank of Canada, or RBC, has been trusted since 1864 and is among the best online banks in Canada. They have a digital banking system called RBC Online.

RBC Online might be a good choice if you like banking with big companies or want to have all your banking needs in one place.

Even though they don’t take away charges for keeping a specific amount in your account, using more RBC services can reduce fees. Depending on your chequing account, you might pay between $4 and $30 monthly.

With RBC Online, you can order money in different currencies and pick it up at the nearest RBC branch. Plus, it lets you check your credit score for free without hurting your credit rating.

Pros of RBC

  • Trusted by many due to its well-known brand.
  • Extensive digital banking facilities.
  • Various account options for personal, business, and investment needs.
  • Many branches across the country.

Cons of RBC

  • Customer service might disappoint.
  • Online systems may have glitches.
  • Savings accounts offer low interest.
  • Debit and ATM fees can accumulate.

9. TD Online

TD Online is the collective term for all TD Canada Trust’s digital services. After its debut in 2007, it has solidified its position as a significant contender in online banking within Canada.

A key feature of their service is the provision of free online e-transfers and round-the-clock cheque depositing via mobile.

The TD Canada Trust is known for its range of no-fee savings accounts that have appealed to many customers. To enhance the banking experience, TD Canada Trust has developed a mobile app.

The app provides online banking services and features tools like TD MySpend, which aids customers in monitoring and managing their spending.

TD Online, one of the best online banks in Canada, offers a wide selection of credit cards, loans, and mortgages. Additionally, they provide a range of investment options.

Pros of TD

  • TD MySpend app helps track transactions and spending patterns.
  • Excellent customer service.
  • No foreign transaction fees on many account types.

Cons of TD

  • Unimpressive interest rates.
  • High balance needed to avoid monthly fees.
Best Online Banks in Canada - comparewise

10. Alterna Bank

Alterna Bank, recognized as one of the best online banks in Canada, is a digital bank owned by Alterna Savings. This Ontario-based credit union has been in business for over a century.

It offers online banking services, which include high-interest savings accounts, chequing accounts, and mortgage options.

Unlike traditional banks, Alterna Bank only operates two physical locations in Gatineau. This means most banking transactions are conducted digitally.

However, customers are not left stranded when it comes to cash withdrawals or deposits. They have free access to thousands of ATMs within the Canadian EXCHANGE Network and the extensive American Allpoint Network.

Alterna Bank is known for its no-fee chequing account that provides unlimited transactions and free Interac e-transfers. It’s also really easy to create an account – it takes about 5 minutes. You can control your account using their website or mobile app.

Pros of Alterna Bank

  • Chequing account without any fees
  • No requirement to maintain a specific balance
  • Unlimited transactions at no cost
  • Offers mortgages and loans
  • Protected by CDIC insurance

Cons of Alterna Bank

  • GIC rates are not very competitive
  • Opening an Alterna account requires having an account at another bank
  • Substandard customer service
  • Lower-than-average interest rate

11. BMO Online

BMO Online, Bank of Montreal’s online banking service, provides secure access to your account anytime. You can also send money online to other people using e-transfers.

BMO Online offers many services. You can open a bank account, deposit a check using your phone, or apply for a credit card.

The cost to use this online service varies from $4.00 to $30.00 per month. However, the bank has special offers for certain groups of customers like students and older adults. The online platform is also easy to use, smoothing your banking experience.

Pros of BMO

  • Broad product portfolio from a big bank.
  • 13 credit cards and 5 chequing accounts on offer.
  • Multiple debit card choices are available.
  • Accounts can be opened with low initial deposits.

Cons of BMO

  • Basic savings account interest is just 0.5%.
  • Need substantial balances to secure top-tier interest rates.
  • Coverage area is somewhat restricted.

12. Oaken Financial

Oaken Financial is a branch of Home Trust Company, and they’ve been offering services to Canadians since 2013. Their online banking platform is secure and gives easy access to all your account information.

Oaken Financial also has a mobile app for iOS and Android users to manage their finances wherever they go.

What’s impressive about Oaken Financial is that they offer some of the highest interest rates in Canada. They have options like Guaranteed Investment Certificates (GICs) and customer savings accounts.

Furthermore, no fees are involved, and there’s no need to be concerned about maintaining a minimum balance in your account.

The bank also offers a callback system. You can share your number; a worker will call later when free, saving you from waiting near your phone.

Pros of Oaken Financial

  • No monthly fees
  • High-interest offerings
  • Zero balance requirement
  • No ongoing costs for savings or GIC plans
  • Maturity terms from 1 month to 5 years

Cons of Oaken Financial

  • Limited to GICs and savings accounts
  • Inactive account fees
  • Lacks a debit card
  • Entirely online operation

13. Achieva Financial

Achieva Financial, established in 1998, is part of the Cambrian Credit Union and serves all Canadian residents. With Achieva, you don’t need to visit a physical bank branch. Instead, you can do all your banking online.

They offer various banking products that can earn you high interest. Their savings account, in particular, is notable for its high 3.40% interest rate, one of Canada’s highest.

With Achieva, there’s no need for concern regarding monthly charges or maintaining a minimum balance in your account. You also get one free transfer or pre-authorized debit per month.

If you need to get cash out, you can use any ATM in the Acculink Network across Canada, and you won’t have to pay any extra fees. This feature is a common benefit among the best online banks in Canada.

Pros of Achieva Financial

  • High savings interest rates
  • Competitive GIC interest rates
  • No monthly charges
  • No minimum balance requirement
  • $1 monthly bonus for electronic statements or tax receipts
  • Accessible to all Canadians

Cons of Achieva Financial

  • No physical locations
  • Limited banking options (no credit cards, mortgages, or loans)
  • Lacks face-to-face support

14. Motive Financial

Motive Financial is like a part of the Canadian Western Bank, accessible only on the internet. You can’t go to an actual bank building for it. They offer different accounts, like checking and savings accounts, that earn more interest. Additionally, it has choices for investing your money.

The bank doesn’t charge monthly account fees, but you might have to pay for extra services. Using their mobile app, you can easily open an account and keep track of your daily financial tasks. The app also provides helpful tools like a retirement planner.

Even though there are no charges for the Motive Chequing account, it only allows two free withdrawals per month. Additionally, each e-transfer costs $1. Unfortunately, Motive Financial doesn’t offer customers credit cards or loan services.

Pros of Motive Financial

  • Provides significant interest returns on savings and GICs
  • Free from any monthly charges
  • Interest can be earned through a chequing account

Cons of Motive Financial

  • No physical customer service
  • Few banking product options
  • Extra charges can accumulate over time
  • Restrictions on the number of transactions for savings accounts

Advantages of online banking in Canada

Online banking has revolutionized Canadians’ financial landscape, offering many advantages, like:

  • Reduced Banking Fees: With fewer overheads, online banks usually don’t charge customers for standard services. This means you could save anywhere from $48 to $360 annually.
  • Convenient Access: Online banking can be done anywhere, anytime, using your smartphone.
  • Unlimited Transactions: Online banks often don’t charge for an excess of transactions. This includes money transfers between banks and Interac e-transfers.
  • Improved Interest Rates: With lower operating costs, online banks often pass savings onto customers through better interest rates.
  • Mobile App Use: All banking operations can be conducted via a mobile app. This eliminates the need to use a desktop computer for banking tasks.

Disadvantages of online banking in Canada

While online banking has become pretty popular in Canada, there are still a few disadvantages you should be aware of, especially with the best online banks in Canada.

  • No Debit Card: Certain online-only banks don’t provide a debit card. This can make it tough to get your money without internet access.
  • Limited Financial Services: Online banks might not have all the financial services you need, like loans or credit cards.
  • Impersonal Service: Online banks don’t have physical branches where you can meet staff members. Personal relationships with bank staff can sometimes help when you need a loan.
  • Few Chequing Accounts: Online banks often focus more on savings and may not offer as many chequing accounts.
  • Need for Technology: You need to be comfortable with technology and have a device with the internet to use online banking. This might not be easy for everyone.

Types of online bank accounts in Canada

Various account options are available for selection at the best online banks in Canada. Each account type serves a distinct purpose, yet they can be effortlessly administered through online channels around the clock.

Chequing Accounts

These are everyday accounts where your salary usually gets deposited. You can use this account to pay for your daily needs. Most online banks in Canada do not charge monthly fees for these accounts and offer unlimited transactions.

Savings Accounts

These are accounts where you can save money for future needs or goals. Digital banks frequently provide more attractive interest rates compared to conventional banks, enabling your savings to increase more rapidly.

GIC Accounts

Guaranteed Investment Certificates (GICs) are like special savings accounts. You agree to leave your money there for a certain amount of time and often get better interest in return.

Hybrid Savings Accounts

These accounts work like savings accounts by earning interest, but you can also use them like a chequing account to spend money.

Student Accounts

These accounts are designed for students. They usually come with benefits like no account fees and special bonuses when you sign up.

Senior Accounts

These accounts offer extra benefits to help retired people save more money.

Non-registered Investment Accounts

These are accounts that allow you to invest your money. The growth you see from these investments will be taxed.

Registered Accounts

These are special accounts like the TFSA, RRSP, RRIF, and LIRA, set up by the Canadian government to help you save for retirement. These accounts come with tax benefits. But remember to check if there are any minimum balance requirements or fees for these accounts.

How to choose the best Canadian online bank?

Deciding on the best Canadian online bank requires careful consideration of several factors. Here are a few key aspects to consider:

  • Fees: Online banks don’t have physical buildings like traditional banks, so they can charge fewer fees. This helps customers save money on things like monthly maintenance fees.
  • Annual Percentage Yield (APY): If you’re looking for your balance to increase over time, the APY of an online account is a crucial element to consider. This can help you accumulate wealth passively by keeping your money in the account.
  • Customer Support: While online banks provide convenience and easy accessibility, they sometimes fall short in customer service. Check if the bank offers support through phone, email, or live chat and if the service is prompt and helpful. Some online banks even offer round-the-clock assistance if you want.
  • ATM Network: Depending on your cash withdrawal needs, the online bank’s ATM network can be a significant deciding factor. It’s always wise to choose a bank offering a substantial ATM network.

Best online banks in Canada for different types of users

When it comes to online banking, there isn’t a one-size-fits-all solution. Different user groups have varying banking requirements, so different banks might suit them better.

In the following section, we present the best online banks in Canada, each tailored to the specific needs of different user groups.

Students

Most students require banking solutions with low or no account fees and immediate access to their funds. A few of the best online banks for students in Canada include:

Tangerine is a great option, providing a chequing account without fees and a savings account with a competitive interest rate. Moreover, they offer a student credit card that doesn’t charge an annual fee.

Simplii Financial is another excellent choice for students. They also offer a fee-free chequing and savings account with attractive interest rates and a no-annual-fee student credit card.

Lastly, BMO also stands out for students with their no-fee monthly student chequing account. They also offer a student credit card free of any annual fees.

Seniors

For senior citizens, user-friendly online banking features and low or zero-fee accounts can make a big difference. Here are some top Canadian online banks that cater to these needs:

Simplii Financial could be a great fit for you, as they have an easy-to-use online banking system and a mobile app. They also offer a chequing account with no fees and a savings account with a competitive interest rate.

TD Online is another solid choice, with no monthly fee for their senior chequing account and a competitive interest rate for savings. They also offer a user-friendly online & mobile banking system.

The Royal Bank of Canada, or RBC, is another excellent option for seniors. They provide a senior-specific chequing account without any monthly fees and a savings account with an appealing interest rate. Lastly, their online banking system and mobile application are simple to navigate, making them convenient for senior users.

Newcomers

If you’re new to Canada and looking to set up your finances, several online banks offer great starting packages. Some of the best Canadian banks for newcomers include:

Scotiabank has a StartRight Program specifically for new Canadians. It includes a chequing account with no fees for the first year and a credit card that doesn’t require a credit history.

Similarly, BMO’s NewStart Program for newcomers provides a year’s chequing account with no fees. It offers a credit card without a credit history requirement.

CIBC also caters to newcomers through their Welcome to Canada Banking Package, which includes a one-year no-fee chequing account.

Final thoughts on the best online banks in Canada

Choosing one of the best online banks in Canada depends on individual preferences and needs. While some users may prioritize low fees or high interest rates, others might value customer service or a broad ATM network.

Remember to consider your unique banking requirements before choosing the right online bank.

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FAQs about the best online banks in Canada

Are online banks safe in Canada?

Using the internet for banking in Canada is really secure. Many online banks have Canada Deposit Insurance Corporation (CDIC) support, which keeps your money safe up to $100,000. Also, online banks use modern and robust tools to keep your account secure. They have things like double-checking sign-ins and automatic warnings to ensure your account is extra safe.

How do I withdraw or deposit cash with an online bank?

You can deposit or withdraw cash using an ATM or an online bank. It's essential to use an ATM that's linked to your online bank to avoid extra charges. If your online bank doesn't give you a debit card or ATM access, you'll need to switch to a bank that does.

Can I open a bank account online in Canada?

Starting an online bank account in Canada is a fairly straightforward process. First, decide on the online bank that best suits your banking needs. Then, head to their website and complete an application form. You'll have to enter information such as your name, address, and Social Insurance Number. After submitting your form, the bank checks your details and may request additional documents. If all goes well, they'll approve your application, and you'll get an email with the steps to activate your account.

Do online banks in Canada have higher interest rates?

Online banks in Canada can provide more appealing interest rates compared to regular brick-and-mortar banks. This is mainly because online banks have fewer overhead costs since they don't run physical locations. These savings can then be shared with customers through increased interest rates.

Are there any fees associated with online banking in Canada?

In Canada, online banks are usually affordable, with low or sometimes no charges for their services. However, some specific transactions or services might have a small fee. This could include costs for using an ATM that isn't part of your bank's network. So, it's a good idea to check out the bank's list of charges before opening an account to avoid surprises.

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August 7, 2023
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