For most Canadians, a chequing account is a type of bank account used to manage money on a day-to-day basis. Chequing accounts are designed to handle everyday financial tasks like paying bills, depositing and withdrawing cheques, ATM transactions, and transferring money.
While a chequing account is a personal banking service extended by most financial institutions, it doesn’t necessarily mean that they are all the same. At first glance, there might not be so much to distinguish one chequing account from the other but the experts at MoneyWizard explored the Canadian banking fray to bring you a few standouts.
But before we reveal our picks for the best chequing accounts in Canada, let’s cover a few of the basics you need to know about chequing accounts.
Who Needs a Chequing Account?
Almost everyone needs a chequing account. But why so? Well, we like to look at chequing accounts as the workhorses of the Canadian day banking arena. They are supposed to help you accomplish everyday transactions, including direct depositing paycheques, paying your bills, making debit purchases using a debit card, and sending e-transfers.
A chequing account is largely viewed as a transactional account through which your holding bank expects you to make frequent transactions with the money currently deposited in the account. There are usually chequing accounts available to students (these usually have no fees attached), corporate accounts designated for businesses, or joint accounts often used by married couples.
At the very least, you can qualify for a basic chequing account which facilitates transactions like withdrawing cash, using your debit card to pay for purchases, and having money electronically wired to you. Even so, a bank could still reject your application for a chequing account if you display a history of mismanaging previous accounts with other online banks or credit unions.
If you’re still interested in opening a chequing account, it’s important to understand that these bank accounts have a type of fee associated with them. Most chequing accounts carry a monthly fee, which your bank may waive if you maintain a minimum balance. Your bank may also charge a fee when you use an ATM, when you overdraw your account, or use your debit card abroad. Some chequing accounts may even slap you with a combination of all those fees.
On the positive, chequing accounts also offer more free or low fee transactions that you wouldn’t otherwise secure with a savings account — whether you’re taking money out from an ATM, depositing, transferring it, or sending a cheque.
Remember to read the fine print before you start using your transactional privileges with wild abandon. Chequing accounts could carry fewer transaction fees but that doesn’t imply they all have unlimited transactions. Most accounts offer only a limited number of free transactions monthly, so you may need to cut down your monthly transactions to remain within the limit. Also, a chequing account won’t earn you any interest on your deposits.
Chequing accounts are not all equal, so how do you choose the best for your needs?
How to Choose a Chequing Account
Not sure what type of chequing account will suit your needs? Start by answering these crucial questions.
How Many Transactions Do I Need Per Month?
While a chequing account is largely a transactional account, it may not suit your needs if there are limitations to the number of transactions you can perform. Your chequing account will most certainly accommodate common everyday transactions like bill payments, transfers, and point-of-sale purchases, but is the number sufficient for your needs?
Identify an account that lets you perform these and other transactions like free interac e-transfers with ease. In this case, if you often use bank drafts or money orders, a digital bank may not be the right fit. Of course, how you utilize your chequing account will depend on your lifestyle, financial habits, and goals.
If you’re a basic banker who’s not looking for anything fancy, BMO’s Practical Chequing Account offers 12 transactions per month for a meagre $4.00 monthly fee. No whistles, no bells, just as simple as you like it.
On the other hand, if you move money frequently and need great transactional freedom, Scotia’s Ultimate Package offers unlimited transactions at a $30.95 monthly fee. You can avoid this monthly account fee by maintaining a $5,000 minimum daily closing balance in your chequing account.
What Will Be My Average Monthly Minimum Balance?
Monthly minimum balance requirements vary among chequing accounts, so you must determine how much your account will house on a regular basis. In fact, most chequing accounts are generous enough to waive the monthly fee if you can maintain the required minimum balance. A good example is BMO’s Premium Chequing Account that waives the $30 monthly fee when you maintain a minimum balance of $6,000.
If you open a checking account that charges a monthly service fee, be sure to meet the minimum balance requirements needed to waive or get a rebate of the fee. Otherwise, you should just choose a checking account that doesn’t mandate you to maintain a certain balance to enjoy $0 monthly service fees.
Chequing Account Fees
Like many other financial products, chequing accounts charge various fees to access your money. Are you willing to pay for more features or more freedom? It all comes down to your preferences. Some common fees include:
- Monthly fees. These fees are charged once a month and are supposed to cover the costs of managing your checking account.
- Transaction fees. Transaction fees are often charged per transaction, such as on every point-of-sale purchase you make.
- Minimum balance fees. Some banks will charge you a fee for not maintaining the minimum balance requirements.
- Bank overdraft fees. You may incur a bank overdraft fee for any payments or charges that exceed what’s already in your account. An overdraft on your chequing account causes a negative balance.
- ATM fees. Some banks may charge you for the ATM withdrawals you make.
- Non-sufficient fees (NSF). Your bank may charge an NSF fee if your account’s negative balance exceeds your current overdraft limit.
Thankfully, account holders can avoid most of these common chequing account fees by responsibly managing their accounts and maintaining positive balances. Even so, we recommend that you opt for accounts that carry minimal fees so you won’t have to keep track of so many requirements. You may want to consider a no-fee daily chequing account that doesn’t charge any monthly service fees. Annual fee waivers can also help reduce the amount of fees accrued.
Best Chequing Accounts in Canada
To help make choosing a chequing account easier, we did our homework to prepare a big steaming bowl of the top chequing account picks for your needs.
Best No-fee Account: Innovation Credit Union’s
No Fee Chequing Account
If you’re tired of paying bank fees, Innovation Credit Union’s No Fee Chequing Account is just what you need. Innovation Credit doesn’t only take the top spot for the best
With Innovation Credit Union’s
- Monthly fees. You’ll incur $0 monthly fees. Save as much as $360/year in banking fees with the No-Fee Bank Account. Rest assured; there are no hidden charges.
- Fast, free, and flexible withdrawals. You can perform as many withdrawals as you want and not pay a dime. Withdraw all your funds within 1 business day.
- Bank On The Go. Access your money anytime, anywhere with Innovation Credit Union’s app and online banking. Manage your funds or pay your bills on the go!
Best Student Account: Scotiabank Student Banking Advantage Plan
Looking for a worry-free account matched for your simple student life? Scotiabank Student Banking Advantage Plan is here to make your student life easier. Not just banking, but all aspects of your life. Besides unlimited debit transactions and Interac e-transfer transactions, this chequing account also promises to reward you for every debit transaction.
Scotiabank promises 5,000 SCENE points or 5,000 Scotia Reward points if you open an account by April 30, 2021. You’ll earn 1 SCENE point for every $5 you spend on all your everyday purchases using a SCENE debit card. You may later redeem your SCENE points for free meals, movies, and more.
The scotia rewards points are just the tip of the iceberg; Scotiabank Student Banking Advantage Plan accrues $0 monthly account fees and you’ll receive a free paperless or paper statement. Other features you’ll access with this account include: online and mobile banking, mobile cheque deposit, free credit score, and Apple Pay, Google Pay and Samsung Pay.
- Number of transactions. Unlimited debit and Interac e-transfer transactions
- Monthly fee. $0 monthly account fee, but you must be enrolled full time in a post-secondary institution
- Rewards. Earn points on everyday purchases with your choice of rewards program
- Mobile app. Yes, available on Google Play and App Store
Best Rewards Account: PC Money
Want a chequing account that will make every dollar worth a little more? Look no further. The PC Money Account lets you earn up to 50,000 points in introductory offers, bonus points that are worth up to $50. You can take advantage of these welcome offers in three simple steps.
- Receive 20,000 PC Optimum points when you make your first purchase of at least $50 or more with your new card.
- Earn a one-time 25,000 PC Optimum points bonus for setting up pension or payroll direct deposit into your PC Money Account.
- Earn 1,000 PC Optimum bonus points per bill payment of $50 or more. You can make up to five bill payments per month.
In addition to the attractive rewards, your PC Money Account is a no monthly fee account that offers unlimited everyday transactions. Being an online self-service money management account, you can pay bills and make inter-bank transfers whenever you wish, online or via the mobile app.
To ensure the security of your money PC Money provides two-factor authentication, 24/7 fraud detection, and round-the-clock support from its team. You can also temporarily lock your card if it’s stolen or lost.
- Interac e-transfer. Free
- Digital integration. PC Financial app is available on Google Play and the App Store
- Number of transactions. Unlimited free transactions both online and in-store
- Overdraft protection. Available but optional
- Monthly fee. $0
Best Account For Global Money Transfers:
Simplii No Fee Chequing Account
With no monthly fees and no minimum balance required, the Simplii No Fee Chequing offers unlimited debit purchases, bill payments and withdrawals. But best of all, Simplii Financial is the only digital challenger bank to offer a zero-fee international money transfer solution with Global Money Transfer (GMT).
Transfer money to friends and family, pay tuition fees or take care of minor medical costs overseas without transfer fees. For many countries, you can send up to $50,000 in both local currencies or US dollars with no transfer fees or deductions. What’s more? Simplii has recently ntroduced a cash pickup service, meaning that your recipient doesn’t necessarily need to have a bank account to receive funds.
- Monthly fees. No monthly fees with no minimum balance
- Fast, free, and flexible withdrawals. Free daily banking—inlimited debit purchases, bill payments and withdrawals
- Bank on the go. Free access to over 3,400 CIBC ATMs across Canada
- Get mobile. Turn your phone into your wallet with mobile payment
Best Account For Most: Tangerine No-Fee Daily Chequing Account
Tangerine offers a no-fee daily chequing account that gives you free daily chequing transactions and pays you interest on every dollar in your account. This includes an unlimited number of debit purchases, bill payments, pre-authorized payments, Tangerine Email Money Transfers and Interac e-Transfer® transactions. You’ll also get free access to 3,500 Scotiabank ABMs nationwide and 44,000 ABMs worldwide through Scotiabank’s Global ATM Alliance.
Experience no-fee daily chequing with Visa* Debit and earn interest on every dollar in your account.
Tangerine also provides personalized tools and insights so you can save, spend and manage your money easily. These tools help your track your chequing account activity, along with other details you provide, and gives you information to help you stay up-to-date with your spending and make smart decisions with your money.
- Monthly fee. $0
- Interac e-transfers. Unlimited
- Overdraft protection. You’ll pay $5.00 per month plus any applicable overdraft interest
- Mobile app. Available on App Store and Google Play