If you’ve just arrived or are planning to move to Canada, you’ll need a bank account to receive, save, deposit, and transfer money. Discover everything you need to know about opening a bank account, including the documents you need and how to open an account before you arrive in Canada.
The banking network in Canada
Canada has roughly 100 banking institutions in operation. For context, the UK has around 300 banking brands while Australia has about 50 banking institutions. And Canada’s banking network is considered to be one of the safest in the world, having avoided significant problems in the financial crisis of 2007–2008.
At the forefront of Canada’s trustworthy banking system are the ‘big five’ of:
- Royal Bank of Canada (RBC).
- Toronto-Dominion Bank (TD).
- Bank of Nova Scotia (Scotiabank).
- Bank of Montreal (BMO).
- Canadian Imperial Bank of Commerce (CIBC).
In addition to these established banks, Canada has seen the rise of several app-only banking companies. Despite not having high street branches, many of these brands offer a wide selection of additional features like trading, stockbroking and insurance.
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Types of Canadian bank accounts
If you’re new to Canada, your best options are to open one of the following types of bank accounts:
- Checking (current) accounts.
- Savings or deposit accounts.
- Business accounts.
- Student accounts.
Each type of account offers different features and services to suit your financial needs or situation. For example, a term deposit account could be perfect if you want to make long-term savings. Savings or deposit accounts are similar to the UK’s Individual Savings Accounts (ISAs) as they both have better interest rates than other savings accounts.
However, with these accounts, you’ll need to add a minimum amount every month and leave it in the account for an agreed length of time.
Opening a Canadian bank account overseas
Moving to a new country means a laundry list of tasks to complete. If you’re moving to Canada, the good news is that you can sometimes open a bank account overseas. You can open a Canadian bank account before arriving in the country if:
- Your bank at home has a correspondent banking relationship with a bank in Canada. A correspondent bank is an authorised financial institution that provides services on behalf of another.
- The bank is an international bank like HSBC, operating in multiple continents. If you already have an account with an international bank, opening an account in Canada is easier. You can open an international or overseas account with a Canadian bank. Usually, you’ll need to be a high-earning individual, and you’ll need to deposit and maintain a large balance. For instance, you can open an international account with Scotiabank and deposit up to CAD$50,000 before you even arrive in Canada.
What documents do I need to open a bank account in Canada?
If you’re setting up your account overseas, you’ll need to have your immigration documents to hand. That can be either your study or work permit and possibly a letter from your future employer or academic institution. The best advice is to submit as many documents as possible.
After that, the bank will contact you to complete your application, assuming your paperwork is in order.
Many banks in Canada cater to foreign nationals, so they will be well-versed in helping you apply. If you’re opening your account in-branch, you’ll need to bring all or some of the following documents:
- Your valid passport.
- Your immigration papers (or permanent residency card if you have one).
- Your Social Insurance Number (SIN).
- Proof of address.
- Temporary Residence Permit.
- Work or study permit.
- Confirmation of Permanent Residence.
Digital bank accounts in Canada
In recent years, there has been a considerable rise in the number of digital, online-only banks. As these digital banks have no branches on the high street, you’ll need to manage your account online or via an app. In Canada, the leading online-only banks include:
- EQ Bank.
- Simplii Financial (formerly PC Financial).
The advantages of online-only bank accounts are that they’re easy to open and don’t require as much paperwork as traditional banks. In some cases, you can even open one without proof of address.
Can you open a bank account in Canada without proof of address?
Yes. There are several instances where you can open a bank account without proof of address. These include opening international accounts with banks such as HSBC and CitiBank.
While proof of address isn’t required, you will have to show proof of residency, like a work or student visa. As mentioned above, you can also open a bank account without proof of address with one of Canada’s many digital banks.
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What’s the best bank account for migrants in Canada?
That depends on the services and features you need. If you’ve just arrived in Canada, you may want to start with a checking account. A transaction account, internationally known as a current account, lets you deposit, receive, withdraw and transfer money abroad or domestically. You can even set up features like Direct Debits and standing orders to help pay utility bills.
Regardless of the type of bank account you choose, it might be worth banking with one of the big five. Collectively, they have the most extensive branch and ATM (cashpoint) networks in the country. The big five are also the most experienced in assisting expats, migrants, and students in managing bank accounts in Canada.
Before opening an account in Canada, have a look at Azimo’s list of things to consider when choosing a bank account:
- What is the initial minimum deposit?
It varies from one account to another, but sometimes like with Wealthsimple’s ‘No-Fee Cash Account’, you aren’t required to leave one at all.
- Is there a monthly service fee?
Certain banks charge a monthly fee for the upkeep of your account. Monthly fees usually apply to accounts with a broader range of benefits. For example, EQ Bank’s ‘Savings Plus Account’ doesn’t have a monthly fee.
- Is there a minimum monthly deposit?
Some banks require you to deposit a certain amount every month to keep the
account open. As mentioned above, depositing the minimum amount usually means you won’t have to pay the monthly service fee.
- Is there a minimum balance?
Some banks won’t let you go under a certain amount of money in your account. A fee may apply if you do. If a minimum balance doesn’t suit your banking needs, Simplii Financial ‘No Fee Chequing Account’ doesn’t have one.
- Are there any overdraft fees?
If you mistakenly or agree to take out more than your balance, a fee may apply. Check what the cost is and if you can afford it in the event of an emergency.
- Does the bank have highly-rated online banking and mobile apps?
If you like banking on the move, choose a bank with a secure and easy-to-use app and website.
- Has the bank set a monthly transaction limit?
Sometimes banks put a cap on how many transfers or withdrawals you can make every week or month. If you’re financially supporting relatives overseas, find out about any limits on transfers beforehand.
- Can you make low-fee overseas money transfers?
If you need to send money to relatives abroad regularly, check if this feature is available and its costs. A lower fee ultimately means more money for your family on overseas transfers.
If you’re moving to Canada to study, you will probably enjoy free banking with a tailored student account. Free banking essentially means there’ll be no monthly fees for having an account.
As a non-student, the fees will depend on the bank. For RBC and Toronto-Dominion Bank accounts, there is an 11 CAD monthly fee to maintain an open account. The Bank of Montreal charges between three and 30 Canadian dollars per month depending on which account you have and how frequently you use it.
In general, you should expect to pay a monthly fee and pay for individual transactions if you go over the allowed monthly limit. Most ATMs will allow free withdrawals if the machine is from your bank and around two CAD if it’s from a different bank.
They may be the best option for storing your cash, but banks should be avoided when sending money overseas. Download the Azimo app on iOS or Android and start transferring money to loved ones around the world. Register today and get your first two transfers fee-free and at exceptional exchange rates.