If you are concerned about the monthly fees charged by the traditional banks and looking for alternative banks in Canada with no monthly fees, Online-only banks are what you should look for. Unless you have a business, if you look at the financial transaction you make every day and the number of interactions you have with your bank, you will notice that most of them are carried out online.
Be it ordering food online, shopping, paying for your utility bills, money transfer etc. more and more transactions are pivoting towards online and mobile-based. This habit can help you save some money on the banking fees every month, after all, a “penny saved is a penny earned”. I looked at the online banks and listed down the top 3 banks which you can choose as an alternative to a traditional bank and open an account and transact from the comfort of your home.
If you are currently searching for online banks, you must have seen the advertisements of Tangerine on social media, Google search etc. Yes, they dominate the Online banking scape and spend heavily on customer acquisition online.
Tangerine was launched as ING DIRECT Canada on April 27, 1997. In November 2012, Scotiabank completed its acquisition of ING Bank of Canada from Netherlands-based ING Groep NV, and with that came the need to change the name to Tangerine.
Today, Tangerine Bank operates as a subsidiary of Scotiabank in Canada and offers online-only services to its customers with the key attraction being a no-fee chequing and savings account. It also offers other traditional investment instruments like Guaranteed Investment Certificates (GIC), Mutual Funds (through a subsidiary), Tax-Free Savings Account (TFSA), Registered Retirement Savings Plan (RRSP), or Registered Retirement Income Fund (RRIF) and Mortgages.
With over 2 million users and close to $40 billion in total assets under management, Tangerine offers a no-fee service to its chequing account customers for unlimited free daily transactions, free cheques (first book), and free access to 3,500 ATMs in Canada and 44,000 worldwide.
- Simplii Financial
Simplii Financial initially formed as President’s Choice Financial was a joint venture between the Canadian Imperial Bank of Commerce (CIBC) and Loblaws to offer low-fee banking services to its customers in 1996.
It offers its services as an online-only bank to its customers with the highlight being a no-fee chequing account and high interest-paying savings accounts. It also offers other financial products similar to a traditional bank like loans, Mortgages, credit cards and other investment options like GIC, TFSA, RRSP etc.
As of November 2021, the bank had almost two million clients and in the same year, it became the first Canadian bank to activate digital identity verification. This makes the bank more accessible to international students and newcomers by giving them the opportunity to open accounts digitally even before arriving in Canada.
The no-fee chequing account offered by the Banks allows unlimited debit purchases, bill payments and withdrawals. It also boasts free access to over 3,400 CIBC ATMs across Canada, and free Interac e-Transfers to its customers.
- EQ Bank
EQ Bank or Equitable Bank is the third on my list which emphasizes offering high-interest hybrid savings-chequing accounts with no monthly fees, unlimited free transactions, and no minimum balance.
The Equitable Bank was founded over 50 years ago as The Equitable Trust Company and in 2016 it launched EQ Bank as Canada’s online-only bank. Presently Equitable has over $35B in assets and serves more than a quarter-million customers.
The highlight of EQ banks is a hybrid savings-cum-chequing account with earns you the interest rate (among all banks) apart from the other usual banking services except the registered investment like TFSA, RRSP etc.
Hope this information helps you decide on your next Bank
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