Compare chequing accounts
Our chequing accounts guide below will teach you about the different types of Canadian chequing accounts, the typical features to expect, how to open a chequing account in Canada, how to compare chequing accounts and the main differences between a chequing and savings account.
What is a chequing account?
A chequing account is typically referred to as an “everyday banking account”, which means you can usually bank with little to no limits. You can deposit your paycheque directly into your chequing account and access your money via ATMs, electronic transfers, cheques, email money transfers and cash back on debit purchases.
In simpler terms, it’s an account that has features to help you pay bills, go grocery shopping and withdraw cash from an ATM. The best Canadian chequing accounts will help you manage your everyday finances efficiently and help you reach your financial goals.
What’s the difference between a chequing vs savings account?
The typical account holder should have a chequing account for everyday use and a savings account to hold their savings. Here are the key savings vs chequing account differences.
|Chequing account||Savings account|
|Purpose||Designed for everyday spending.||Designed for savings or accumulating wealth.|
What are the typical features of a chequing account?
- You don’t really earn interest. From the bank’s point of view, your chequing account holds funds that are readily accessible on demand, so they don’t accumulate interest as there is no incentive for holding your funds there. If you’re looking for a high interest rate, a savings account may be more suitable.
- It comes with a linked debit card. A debit card is a card that is linked to your chequing account so you can access your money at ATM’s, debit card terminals and online. Many debit cards utilize security chip technology, where you can use Mastercard Tap & Go® or Visa PayWave to make purchases usually under $100 within a few seconds by holding your card in front of the reader. Alternatively, you can input your PIN to access and retrieve your funds.
- You get free ATM access to network ATM’s. Your debit card lets you access your funds from an Automatic Teller Machine (ATM). Your bank will also provide you with a network of ATMs that you can use for free. Some banks may also have global ATM alliances, which means you can freely access your money using specific ATM’s overseas.
- You can also use an international ATM network – for a fee. If your bank doesn’t have a global ATM alliance, you will incur a fee when you withdraw funds from an overseas ATM.
- You can link your chequing and savings accounts. Many financial institutions give you the option of linking your chequing account to your savings account. That way, you can easily transfer money back and forth to make the most of the higher interest rate available from a savings account.
What are the different types of chequing accounts?
- Personal chequing accounts. This is the most common type of chequing account in Canada, which usually comes with a set number of monthly transactions and a variety of features, depending on the account you choose. You will likely face a monthly fee for this type of account.
- No-fee chequing accounts. It is possible to find a no-fee chequing account, however you will likely have less available monthly transactions and face other restrictions.
- Interest earning chequing accounts. Most chequing accounts don’t offer interest, however it is possible to find one that does. Keep in mind the interest will likely be a lot lower than the interest offered on a savings account and you may face certain restrictions.
- Cash back chequing accounts. Another rare type of chequing account, a cash back chequing account can help you earn back some of the fees associated with a chequing account by providing you with cash back when you use your linked debit card.
- Student accounts. These chequing accounts are designed for students or youth under 18 who are looking for low-cost everyday banking solutions. You will usually need to meet specific eligibility criteria, including age and education requirements.
- US dollar chequing accounts. If you frequently cross the border into the US, you can save a lot on fees and conversion rates by looking into a US chequing account. These accounts can usually be linked to your savings or chequing accounts, which gives you easy access to your funds no matter where you are.
The benefits of having a chequing account
- A convenient way to organize your money. Pay your bills, receiving your salary or benefits, pay for goods and services or send money to someone else.
- A safe place to keep your money. This is especially helpful during uncertain economic climates. Your chequing account is “on demand”, meaning you can access your funds at any time.
- A place that records your transactions. When applying for a loan, lenders will be able to refer to your transaction records to assess how well you can save money. You can also see where you’re spending most of your income.
- A place to build your assets. Money held in your chequing account is easy to access – by linking it to a savings account, you can also earn interest.
- If you’re unhappy, you can easily change accounts or banks. One of the great things about bank accounts are that they can be a short term commitment. So if you’re unhappy with your current bank account, you can always switch to a new bank. Review your needs regularly to see if your chequing account still meets them.
Questions to ask when choosing the right chequing account for you
Here are some questions to ask to help you find the right chequing account for your needs:
- What’s your standout feature(s)? This is the one feature or characteristic that your chequing account must have. Some people prefer convenience and flexibility, while some want no fees or unlimited monthly transactions.
- Are the features worth the fees? You’ll find that most chequing accounts charge a monthly fee, but the good news is that as the space gets more competitive, banks are also offering new ways for you to avoid them. The rise of internet banking has meant that teller fees are almost a thing of the past and some banks waive the monthly fee if you deposit your paycheque into your account or if you have a range of products with the bank.
- What type of bank account do I need? Chequing accounts are designed to meet your everyday banking needs – whether it’s an account to deposit your paycheque, or just an account to pay for bills and groceries. Compare a range of chequing accounts including standard, no fee, interest, US dollar, student and more to find the one that suits your needs the most.
How does an online chequing account work?
An online chequing account is an everyday bank product that you open and maintain entirely online. You can pay for purchases and access cash with a debit card and manage your funds online or with a mobile app.
Some online chequing accounts are operated by completely digital banking providers, while others are operated by major banks and credit unions.
How do I compare online chequing accounts?
If you’re thinking of opening a bank account online, compare accounts based on:
- Customer service. If the bank is completely online and you can’t walk into a branch to get help, so check what methods you have to get a hold of a customer service agent. Find out if help is available 24/7 or only during certain hours, or if you can use online chat to get answers.
- Fees. This includes monthly maintenance, ATM, foreign transaction and overdraft fees.
- Access. What functions are available in the bank’s app or online? Can you easily transfer money to another account? Can you digitally deposit cheques?
- ATM network. How large is the bank’s ATM network? Can you easily access cash when you need it?
I'm starting a job overseas, should I go with an international bank?
Choosing an international bank could help, but be mindful that in each jurisdiction the banks are under their local regulations and are separate legal entities. Depending on how strict they are in the country that you’re working in, it may not be worth switching to another bank.
Some Canadian banks may be able to offer you worldwide assistance.
Quick tips for using everyday bank accounts
- If you’re paying for purchases at a store where you can get cash back, ask for cash at the same time rather than withdrawing at an ATM. This counts as one transaction, not two, and lets you avoid any potential fees.
- If your chequing account has a limit on the number of transactions you can make each month before fees apply, monitor your account regularly and try to work out ways to minimize your transactions where possible.
- If you’re currently paying a monthly account-keeping fee on your chequing account, ask your bank what options you have for getting that fee waived. They may suggest opening a savings account or depositing your salary into the account or maintaining a minimum balance in cash in order to get rid of that fee. They may also suggest a different transaction account that could end up suiting your needs better in the long run.
Chequing accounts very popular with Canadians
Canada’s banks are considered one of the strongest financial networks in the world. According to the Canadian Bankers Association, more than 99% of Canadian adults use at least one bank account and 31% pay no fees, at all, to use these accounts.(1)
Over the years, the addition of fintechs, money app disrupters and online banks, has only strengthened Canada’s banking services — helping to improve services, lower fees and increase the number and type of products available to Canadians.
Despite all this change — and the variety of products to select from — Canadians still rely on a chequing account as their day-to-day bank account. In January 2023, data from the Finder: Consumer Sentiment Survey Q1(2) was released, and showed that 17% of respondents were looking to open a new chequing account in Q1 2023.
The desire to open a new chequing account dropped from Q1 2023 to Q2 2023, with just over 1 in 10 Canadians (11%) planning to open a chequing account between April and June 2023 (compared to 17% between January and March 2023).
How do I open a chequing account?
Once you’ve decided on the right Canadian chequing account, navigate to the bank’s website where you can start your secure online application. Depending on your personal situation, you may need to consider the following when you open a chequing account:
Eligibility requirements to open a chequing account
- Age. Unless you have a parent or guardian co-signing on the account, you will need to be 18 years of age, or the age of majority in your province or territory.
- Residency. You will likely need to be a Canadian citizen or a permanent resident with a valid Canadian address. If you’re a temporary resident, you will need a valid passport and your immigration papers to apply.
Required documents to open a chequing account
- Personal details. You’ll need your personal details on hand, including your full name, address, phone number and email address.
- SIN number. You will need to apply for your Social Insurance Number (SIN).
- Two valid pieces of ID. You’ll need to provide two pieces of valid Government issued ID, such as a passport and a driver’s licence.
What happens after I’ve submitted my application to open a chequing account?
Depending on the bank, your account could potentially be opened immediately or within a few business days. Your bank will send you a package confirming the details of your new chequing account, along with its linked debit card. You’ll need to activate your debit card, with the activation instructions provided in the welcome package.
What are the risks with a chequing account?
- Choosing the wrong type of account. Each type of account serves a very specific purpose. Not choosing the right one could result in paying unnecessary fees or penalty charges.
- Not having the right features. Look closely at each account to ensure that it has the features you need to make your banking needs easier.
Using PayPal with a chequing account
How to close a chequing account
When you’re sure your new account is up and running properly, it’s time to close your old account. This should only be done when you’re sure all your direct debits and credits have been successfully transferred over and you’ve given your new account details to anyone paying money into that account.
It’s important to eventually close that old chequing account, even if it’s empty. Some banks may charge inactivity fees for not using your account. Others may continue to charge monthly fees, which could cause you to go into overdraft on your old account.
It may be easiest to go into a branch to close your account, and in some cases it’s required. Depending on the bank, you may also be able to close your account over the phone. The easiest way to know for sure which option your bank wants is to call them and ask.
If you want to be absolutely sure that your account is closed, try logging into your account online to see if it’s still active. You can also call or go into a local branch and ask a teller to verify that you’re no longer in their system.
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