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Compare interest-earning chequing accounts

Get a boost to your balance while making everyday transactions with an interest-earning chequing account.

Most chequing accounts are designed to separate your more fluid cash from long-term savings. Although rarely offered, an interest-earning chequing account (also known as a hybrid account) sweetens your money management with a rate that allows you to earn interest along with that easy access.

These hybrid accounts combine the accessibility of a debit card with the ability to earn interest on the money in your account, and are common across general investment accounts and accounts designed to hold funds for retirement.

Our interest-earning chequing account guide below allows you to compare these accounts that let you earn a small amount of interest on your balance but also allow you to link the account to your debit card in order to easily access your money to make purchases.

Do chequing accounts earn interest?

While some chequing accounts earn interest, many do not. Chequing accounts from big banks, like TD and RBC, don’t typically offer the option to earn interest on your account balance. However, most digital banks, like Tangerine and EQ Bank, do offer interest-earning chequing accounts.

That said, the interest rate you earn on your chequing account will always be less than what you could earn with a savings account. So if you’re looking to use interest to grow your money, you’re better off opting for a high-interest savings account. But if you just want to top up the money set aside for everyday spending, an interest-earning chequing account can be a great option.

Compare interest-earning chequing accounts

1 - 4 of 4
Name Product Monthly Account Fee Free Transactions e-Transfer Fee Bonus Offer Offer
BMO Performance Chequing Account
BMO Performance Chequing Account
$16.95 (can be waived)
unlimited
$0
Earn $600
Get up to a $600 cash bonus. Valid until July 2, 2024. Plus, earn a 5.50% promo interest rate when you open a Performance Chequing and a Savings Amplifier Account.
Tangerine No-Fee Daily Chequing Account
Tangerine No-Fee Daily Chequing Account
$0
unlimited
$0
Earn $500
EQ Bank Personal Account
EQ Bank Personal Account
$0
unlimited
$0
Earn 4.00% interest
Enjoy high interest with no fees on everyday banking, plus unlimited transactions and no minimum balances. Sign up online in minutes.
Neo Money Account
Neo Money Account
$0
unlimited
$0
N/A
loading

How does an interest-earning chequing account work?

An interest-earning chequing account allows you to earn interest on your chequing account balance while still allowing you to regularly access your funds, use ATMs, pay bills and do everything you would normally do with a regular chequing account. But the interest rate is typically at a lower rate than you’ll find with a savings account. Because the rate is lower, it won’t replace traditional or high-yield savings, but a little growth each month can’t hurt.

Interest-earning chequing accounts aren’t usually offered by the major banks but they do exist. Read the fine print of your account’s terms and conditions for minimum deposits or balances required to trigger the interest rate.

How can I compare interest-earning chequing accounts?

First assess what your needs are, the type of transactions you tend to make and how often you deposit money in your account. High-yield chequing accounts often come with low ongoing fees. To make sure you’re getting the best deal you’re eligible for, weigh the interest rate against ATM, debit and other transaction fees that can eat into your ability to earn interest.

Competitive features designed to keep more of your money away from fees and reward you for your loyalty include:

  • No monthly fees. Look for ways to avoid advertised maintenance fees, including committing to regular direct deposits or autopay requirements.
  • Low or no monthly deposits. Some accounts require a minimum monthly deposit to earn interest or avoid fees.
  • No ATM fees. Competitive banks offer free out-of-network withdrawals and even reimburse you for fees you’re charged by third-party operators.
  • Convenient banking. If you like banking on the go, look for a robust banking app that allows you to manage your balance from your phone and an easy to use online banking portal. Find a network of brick-and-mortar branches if you prefer in-person support.
  • Low minimum opening balance. Look beyond banks requiring minimums that are more than you have to save.
  • Competitive interest rates. Get the most out of your interest rate by learning whether interest payouts align with your paycheques — you’ll want it calculated against your highest balance between constant withdrawals and deposits.
  • Rewards and perks. Many banks entice customers with cash back, miles or other rewards with your debit card.
  • No foreign transaction fees. Frequent travellers will appreciate straightforward spending overseas and on foreign websites.

Can I pay bills from my savings account?

Generally, no — though you may occasionally see exceptions. Paying bills from your savings account would be detrimental to your savings goals, so most banks don’t allow you to write cheques, use a debit card or pay bills from your savings account.

If you want to withdraw any money from your account, you usually have to transfer the funds to a linked chequing account. Once the money arrives in the linked account, it can then be used to pay your rent and other bills.

You may, however, be able to pay a bill from your savings account using a third party payment platform such as PayPal. This option will result in higher fees, as you’ll be charged either a flat rate or a percentage of your transaction as payment for using the third party’s services. Another option is to have funds debited directly from your account to your bill payee.

What is a direct debit?

When you set up a direct debit from your bank account, you give a third-party service provider permission to withdraw money from your account. But it’s not a good idea to use these often, as they increase your chance of going over your account’s withdrawal limit and being charged fees.

What are the pros and cons of interest-earning chequing accounts?

Pros

  • Interest on your balance. Earning money with little effort is a plus, especially when most chequing accounts don’t offer it.
  • Easy access to your money. Set aside the funds you need to pay regular bills and funnel anything that’s left to your long-term savings account.
  • CDIC protection. Your balance of up to $100,000 is protected against the financial institution’s collapse or failure.

Cons

  • Low interest rates. Interest rates are often lower than your typical savings options, so don’t expect to rely on these accounts for long-term savings.
  • Minimums required. Some banks may require you to maintain a minimum balance in the account. If you can’t maintain at least the minimum, you may end up paying an assortment of fees, or find you’re excluded from earning the interest you sign up for.

Bottom line

An interest-earning chequing account can earn you a little extra on your balance intended for regular, everyday payments. But it doesn’t replace a savings account for long-term savings.

To keep your nest egg safe, compare savings accounts to find the highest interest rate you’re eligible for.

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