Opening a Bank Account in Canada
Opening a bank account in Canada is one of the first steps in successfully settling in the country. Canada's strong and reliable banking system is widely considered one of the safest in the world, ranking as the world’s soundest banking system for the past several years, according to the World Economic Forum.
Who Can Open a Bank Account in Canada?
In Canada, you will be able to open a bank account even if you:
- Are unemployed;
- Are not planning to put any money into an account at the time of opening;
- Have a poor credit rating;
- Were a bankrupt before
Who Can Be Denied a Bank Account?
You won’t be able to open a bank account if:
- Bank considers you will be using your account to break the law;
- You have committed a crime against a bank during the previous seven years;
- Bank considers you have provided unreliable information when applying for opening a bank account;
- Bank considers that opening an account can potentially harm its clients and the staff;
- You aren’t allowing a bank to check whether all the circumstances mentioned above might be applied to you nor check your ID documentation;
- You are unable to present relevant ID documentation;
- You are an undesirable person in Canada
If you have been denied a bank account on the basis of one of the reasons above, you can seek help in the Financial Consumer Agency of Canada.
How to Open a Bank Account in Canada?
The procedure for opening a bank account in Canada is straightforward. Simply go to the bank of your choice in person and provide documents that prove your identity. You can also apply to open an account online on the bank’s website.
If you aren’t a citizen of Canada, you will need the following documents for opening a bank account in Canada:
- Your valid passport;
- Permanent residency card or immigration papers.
Different banks might have specific requirements, so we recommend you to get in touch with the bank beforehand to ensure you have all the documentation they need. In most cases, banks accept one of the following immigration documents:
- Temporary residence permit;
- Work and study permit;
- Application form for permanent residence (IMM 5292, IMM 5688, IMM 1441, IMM 100)
Opening a Canadian Bank Account Remotely
You can open a bank account before your arrival in Canada. To do so, you will need to apply for opening a bank account and get in touch with the bank by email or phone. You might be asked additional questions to confirm your identity and immigration status. Then bank representative will contact you, as a rule, during a few working days. You might need an additional two-three days to proceed with your application. To finish the process, you will have to visit a branch once you are in Canada. Canada’s major banks have special products for newly arrived immigrants. In addition, all the difficulties can be resolved in person.
Which Banks Are the Best for Immigrants?
The most popular banks in Canada are HSBC Canada, CIBC, Scotiabank, Bank of Montreal (BMO), and National Bank of Canada.
HSBC: Opening A Bank Account in Canada
HSBC Bank Canada is part of the HSBC network with a global presence around the world. They have more than 100 branches spread out in Canada’s metropolises. They offer a service known as “Global view” which covers a large number of people with HSBC accounts in other countries. So with their personal accounts, clients can access and transfer their funds easily despite their location.
HSBC has special banking products for newcomers. To learn more, visit the bank’s official site.
CIBC: Opening A Bank Account in Canada
The Canadian Imperial Bank of Commerce (CIBC) has a very good reputation for its contribution in supporting and developing businesses and communities not only in Canada but even outside Canadian borders. On top of that, CIBC has been praised for its prime customer support.
CIBC keeps on contributing to the future. This relates to enhancing banking accounts for the purpose of the best customer service. CIBC Mobile Banking continues to remain the most ranking for being very functional and user-friendly. Similarly, CIBC’s chequing account is flexible to use. If you are a newcomer, you will see a great benefit of chequing system in Canada.
To learn more, visit the bank’s official site.
Scotiabank: Opening A Bank Account in Canada
Scotiabank allows international foreigners to open their bank accounts abroad. You can even transfer up to $50.000 to your Scotiabank international account prior to your arrival in Canada.
Once you establish yourself in Canada as a skilled worker or a student, you will get a $100 bonus for opening an account. Scotiabank offers a wide range of services for newly landed immigrants.
To find out more, visit the bank’s official site.
BMO: Opening A Bank Account in Canada
BMO (Bank of Montreal) is the oldest bank in Canada, with 200 years of experience supporting newcomers. Their NewStart program offers immigrants in Canada within the last 12 months of free banking. In addition, you won’t need to have a minimum balance, including a free safety deposit box, unlimited electronic, and Interac E-transfers.
Here you can visit BMO's website.
National Bank: Opening A Bank Account in Canada
Immigrants intending to settle in Quebec should consider National Bank because it is the largest in the province. As a newcomer, you’ll find offers that match your circumstances valued at up $600. Also, you will have access to the Assistance Service for newcomers.
What Should You Know About Opening a Bank Account in Canada?
There are many points to consider before opening a bank account in Canada. As you can see now, most banks offer special services or products for newcomers. To choose the right one, you have to visit banks near you and bank consultants will recommend the best option for you.
In the meanwhile, there are a few things to take into consideration, such as types of bank accounts, monthly fees, ATM interest fees, cheques, and so on.
Types of Bank Accounts
There are many types of bank accounts. Personal accounts are normally intended for everyday financial needs. They include:
- Saving accounts – intended for keeping the funds. A bank will pay you interest on your deposit.
- Current accounts – intended for general everyday bank transactions, such as paying for different services, using ATM and etc.
- Combined accounts – intended for savings and everyday use.
Bank services are free for students and newcomers in Canada and there’s also a large discount for people over 60, but only for a certain period of time. As soon as that period expires, you can be faced with a monthly fee of up to 30 Canadian dollars. Many banks do not require this fee if you put a minimum amount on your account. In most cases, the minimum balance is about $3500 CAD.
ATM Interest Fees
Withdrawing cash from an ATM is free if you are using your bank ATM. However, it will cost you CAD $1.50 for each transaction when using another bank’s ATM. If you withdraw your cash in a foreign country, the interest fee might reach CAD $5 plus 2,5%.
Cheques are used in a few countries, including the USA and Canada. It is something that newcomers don’t understand when they arrive in Canada, because checks or in Canadian reality, cheques, are no longer common in most countries,
So what is cheque? Cheque is a piece of paper with account holder’s name, address, a unique cheque number, date and “pay to the order of” (a person eligible to cash the cheque).
As you begin working, your employer might ask you to provide a “void cheque” to transfer money to your account. In the same way in Canada, landlords often require to pay rent with a cheque. Find out if your bank will allow you to open a chequing account along with your bank account.
With Interac e-Transfer, merchants can easily send and receive money directly from one bank account to another. You just need to become a member of the eligible financial institution and create mobile banking. Then, you’ll be able to receive or transfer money by entering a mobile phone number or e-mail address and a Canadian bank account number. A good thing is that you don’t need to disclose your personal information.
Credit Cards in Canada
While you can use debit cards without any extra fees, you should consider obtaining a credit card. If you need to spend money on living expenses, then a debit card is a better option. Thus, you will avoid getting into debt with a bank. But if you are planning to rent a car or a home, you might be required to pay with your credit card.
Your bank will advise you on credit card options, but generally, credit cards are divided into the following categories: No annual fee and annual fee with perks.
The rewards or perks can be additional points for the purchased items, airline ticket and so forth. Credit cards with a higher annual fee, usually offer higher rewards. This is why it is so important you read carefully credit card terms and conditions.
Other banks can offer benefits, such as travel insurance, extended warranties on purchases. If you like traveling, you may consider a credit card associated with one of the major airline loyalty programs such as Aeroplan or AirMiles.
To find the best credit card option that will suit your situation, you have to make a research.