Most Canadians open an account at whichever bank is closest to where they grew up, and never revisit the decision. That default can cost hundreds of dollars per year in unnecessary fees and foregone interest.
Choosing a bank is not complicated, but it does require knowing what you are actually comparing. The right answer varies significantly depending on whether you need branches, how much you keep in savings, and whether you want a single institution or are comfortable splitting your banking between two.
The Three Types of Banks in Canada
Big 5 Banks
RBC, TD, Scotiabank, BMO, and CIBC are the five largest banks in Canada. They account for the majority of Canadian personal banking relationships and offer the most complete product ranges — chequing and savings accounts, credit cards, mortgages, personal loans, investment accounts, and business banking.
Strengths: Largest ATM and branch networks; full product range under one roof; robust mortgage and investment capabilities; strong newcomer programs; well-rated apps.
Weaknesses: Monthly fees on most chequing accounts ($10–$30, waivable with minimum balances); near-zero interest on chequing and most savings products; savings rates significantly below online competitors.
Online Banks
Tangerine, EQ Bank, Simplii Financial, Manulife Bank, Motusbank, and Neo Financial are the main players. These institutions operate entirely (or primarily) online, which eliminates branch overhead and allows them to pass savings to customers through lower fees and higher deposit rates.
Strengths: No monthly fees; unlimited transactions; higher savings rates (2–4%+ vs near zero at Big 5); competitive GIC rates.
Weaknesses: No physical branches; limited or no cash deposit capability; fewer product lines (most do not offer mortgages directly, though Manulife Bank does); smaller ATM networks (though Tangerine uses Scotiabank ATMs and Simplii uses CIBC ATMs).
Credit Unions
Credit unions are member-owned financial cooperatives. Major examples include Meridian (Ontario), Coast Capital (BC), Desjardins (Quebec), FirstOntario, and Vancity. As non-profits owned by their members, they often return profits through lower fees and loan rates.
Strengths: Often competitive mortgage and auto loan rates; lower NSF and overdraft fees; community focus; Alberta credit unions offer unlimited provincial deposit insurance (no cap).
Weaknesses: Provincial membership restrictions in many cases; smaller ATM networks; mobile banking technology often lags behind Big 5 and online banks; deposits covered by provincial insurance, not CDIC — limits and terms vary.
Key Factors to Compare
Monthly Fees
Big 5 chequing accounts charge $4–$30 per month depending on the account tier. Most waive the fee if you maintain a minimum daily balance ($2,000–$6,000 depending on the account). However, that minimum earns near-zero interest — effectively a hidden cost.
No-fee accounts at Tangerine, Simplii, and EQ Bank have no minimum balance and no monthly charge.
| Bank | Monthly Fee | Fee Waiver Condition |
|---|---|---|
| RBC Advantage Banking | $11.95 | $4,000 min. daily balance |
| TD Everyday Chequing | $10.95 | $3,000 min. daily balance |
| Scotiabank Basic Banking | $10.95 | Not waivable (basic tier) |
| BMO Performance Chequing | $16.95 | $4,000 min. daily balance |
| CIBC Smart Account | $4.95–$16.95 | Scales with transaction count |
| Tangerine Chequing | $0 | No condition |
| Simplii Financial | $0 | No condition |
| EQ Bank Savings Plus | $0 | No condition |
Savings Rates
This is where online banks have the clearest advantage. The gap between a Big 5 savings account and a competitive online HISA can be 3–4 percentage points — translating to $300–$400 per year on a $10,000 balance.
| Institution Type | Typical HISA Rate (2026) |
|---|---|
| Big 5 banks (standard savings) | 0.01–0.50% |
| Big 5 banks (promotional HISA) | 1.00–3.00% (introductory, then drops) |
| Online banks (ongoing rate) | 2.50–4.00% |
| Credit unions | 1.50–3.50% |
ATM Access
If you regularly withdraw cash, ATM coverage matters. Online-only banks with limited networks can make this painful.
| Institution | ATM Network | Free Withdrawals |
|---|---|---|
| RBC | 4,200+ RBC ATMs | Yes, within network |
| TD | 3,500+ TD ATMs | Yes, within network |
| Simplii Financial | 3,400+ CIBC ATMs | Yes (uses CIBC network) |
| Tangerine | 3,500+ Scotiabank ATMs | Yes (uses Scotiabank network) |
| EQ Bank | Any ATM | First withdrawal free per month; $1.50 after |
| Credit unions | Co-op ATM network (~4,000 in Canada) | Yes, within network |
Mobile App Quality
For most Canadians under 50, the app is the bank. App quality varies significantly. The Big 5 all have mature, full-featured apps. EQ Bank and Tangerine are consistently well-rated among online banks. Neo Financial and KOHO have strong apps oriented around spending insights and cashback.
Product Range
If you want a mortgage, investment accounts, and everyday banking all at one institution, a Big 5 bank is the practical choice. Online banks generally do not offer mortgages directly (Manulife Bank is the main exception) and most do not offer registered accounts beyond TFSAs and RRSPs.
The Most Common Banking Setups That Work Well
Setup 1 — Online-only (simplest, lowest cost): One no-fee chequing account at EQ Bank, Tangerine, or Simplii. Keep three to four months of expenses in a HISA at the same institution or at a competitor with a better rate. Works best if you rarely need to deposit cash.
Setup 2 — Split (most popular among financially engaged Canadians): No-fee chequing at Tangerine or Simplii for everyday transactions. Separate HISA at EQ Bank or whichever institution has the best ongoing rate. Transfers between accounts take one business day via EFT or are instant via e-Transfer. You get the best savings rate and no monthly fees.
Setup 3 — Big 5 as primary with online savings: Big 5 chequing account (waive the fee by meeting the minimum balance, or pay the fee for the branch access convenience). Separate HISA at an online bank for savings above your spending buffer. This works well if you need in-person services, have a mortgage with the bank, or value having everything on one statement.
Setup 4 — Credit union: A provincial credit union as your primary bank — works best in British Columbia, Alberta, Ontario, and Quebec where large credit unions operate. Best for those who value local relationships, want competitive loan rates, or have complex mortgage needs outside the Big 5.
Questions to Ask Before Deciding
- Do I regularly deposit cash? If yes, you need a bank with branches or Scotiabank/CIBC ATMs. EQ Bank does not accept cash deposits.
- Do I have a mortgage or plan to get one? If yes, consider whether being at the same bank offers a rate advantage — or whether the best rate is elsewhere.
- Do I need in-person service regularly? If yes, Big 5 or a local credit union is more practical.
- How much do I keep in savings? The higher your savings balance, the more valuable a competitive HISA rate becomes.
- Am I a newcomer to Canada? A Big 5 newcomer program for the first year is a practical starting point before you have credit history established.