The Best Online Banks in Canada 2023
Canadian Online Banks have done a great job keeping up with the demands of today’s consumers. I’ve personally used several of the options on our Best Online Banks in Canada for 2023 list, and can speak to how much the entire banking experience has improved in Canada over the last two decades.
My updated comparison of Canada’s online banking options includes services, interest rates, account fees, transaction fees, and promo offers.
Best Online Canadian Bank Comparison
While reviewing my personal ranking of Canada’s online banks, please keep in mind that everyone’s requirements are different. Personally, I want the best interest rates for my high interest savings accounts and Canadian GICs. In order to get those elite rates, I’m willing to not have to visit a physical store in a strip mall.
No Available Promotion
1.60%, with special promo rate of up to 4.60%
0.40% (5.25% Teaser)
No Available Promotion
0.25% - 3%
No Available Promotion
0.05% - 2.50%
No Available Promotion
No Available Promotion
Now, keep in mind that while virtual banks are competing with the big brick and mortar banks, they still vary quite a bit in their offerings. Some of the new online banks in Canada offer teaser rates (which I don’t love) while others have a lower, but consistent rate that hold steady over time.
Similarly, some digital banks are basic and only offer one or two account options while others are growing to add accounts other than chequing and savings including TFSAs and RRSPs.
So if you are looking for the best online bank in Canada when it comes to your personal wishlist, read on to see which boxes our leading competitors check off.
Why Use an Online Bank?
When was the last time you walked into a bank?
These days most Canadians use online banking to conduct and take care of their financial needs. The best online banks have made our lives substantially easier, to the point where it’s the norm rather than the shiny new toy.
I don’t know about you, but I definitely prefer being able to pay my bills from my couch while wearing sweatpants on a cold winter day rather than having to wait in line to see a teller.
Online Banking Cost
Big banks have overhead costs that trickle down to you, the client, which means you have to pay more for your accounts and frequently are offered lower interest rates. In comparison, online banks don’t have those big overhead costs which means they can offer you higher rates and, depending on the online bank, even free bank accounts.
Another huge draw to online banking is the convenience. You can do everything from opening an account to paying a bill online anywhere; from the comfort of your home, to the gym, to the office. It doesn’t matter, your online banking is always available.
Online Banks are Time Savers
On top of being convenient, online banks actually save you time. No more waiting in line or worrying about bank hours. You can do whatever you need to with the push of a couple of buttons (or computer keys) at whatever time of day you want.
EQ Bank – My Pick For The Best Online Bank Account in Canada
Since 2016, EQ Bank has been dedicated to affordable, convenient digital banking. Its parent institution, Equitable Bank, was founded in 1970 and is Canada’s 7th largest national bank.
EQ Bank offers personal high-interest savings accounts (individual, joint, and USD) as well as competitive GICs, RRSPs, and TFSAs. Check out our full EQ Bank Review for more details.
As of 2023, EQ Bank also offers the EQ Bank Card, a reloadable debit card with the same high 2.5% interest rate as their savings accounts, plus 0.5% cashback on every purchase. That means you can make point of sale purchases as well as ATM withdrawals, all with no fees.
And best of all, EQ is now available in Quebec!
- Great interest rates on savings accounts and GICs
- No fees
- Excellent mobile app
- Top ranked bank in Canada
- Cashback bank card
- No business accounts
Best Feature: No fees, great rates, convenient purchasing power, and a fantastic app.
Tangerine — Runner Up for Best Online Bank in Canada
Tangerine, a digital-only subsidiary of Scotiabank, was originally ING Direct, a pioneer in branchless banking in the 1990s. Acquired by Scotiabank in 2012, Tangerine was considered Canada’s top online bank for years.
Tangerine offers no-fee chequing and savings accounts, no-fee cashback credit cards, and GICs as well as mortgages and investment account options. You can read more in my full Tangerine review.
Currently, when you open a new account with Tangerine you can get an interest rate of 5% in their high interest savings account, which is great. However, after 5 months that drops to 1% which is not as enticing.
- Excellent online platform and app
- Solid no-fee credit card options
- Good promotional offer
- Best all-in-one online bank
- Everyday interest rate is only 1%
- Investment account options can’t beat the best online brokers.
Best Feature: The No-Fee Money Back Credit Card and the convenience of a one-stop bank.
Scotiabank — Best Big Bank for Online Banking
The only one of Canada’s big banks to make our list, Scotiabank was founded in 1831. It offers a variety of banking packages, most of which you can apply for and access completely online.
Scotiabank offers chequing and savings accounts, a line of credit cards, and investment accounts. Their Ultimate Package includes a huge number of features, from a safety deposit box to cheques and bank drafts for no extra fee.
Scotiabank is currently offering new clients a $350 welcome bonus if they sign up for their Preferred or Ultimate Packages and set up two automatic payments or deposits. You can read all the details in our Scotiabank Review.
- Excellent perks and inclusions
- Generous welcome bonus
- Premium credit card fee waived
- Hefty fee unless you maintain a minimum balance
Package is only worth it if you actually want all the bells and whistles
Best Feature: The package inclusions. Big banks are pricey, but Scotiabank’s packages offer good value for that money.
Simplii Financial—Best Online Bank Welcome Bonus
Simplii Financial falls under the CIBC umbrella and was known as PC Financial until 2017.
Simplii offers the full range of online banking features: chequing and savings accounts, credit cards, mortgages, loans, and investment options including GICs, RRSPs, TFSAs, and mutual funds. Learn more about Simplii Financial here.
Simplii is currently offering a welcome bonus of $400 if you open a chequing account. While that’s the same amount as Scotiabank offer, there are fewer requirements to qualify. New savings accounts also receive 5 months of a 5.25% promotional interest rate.
- Excellent welcome bonus
- Variety of banking options
- Low fees
- Low everyday interest rate for savings accounts
- GIC rates aren’t competitive
- Customer service isn’t great
- Platform isn’t user friendly
Best Feature: That sweet welcome bonus and the variety of offerings.
Motusbank – Best Online Bank for Travelling in the US
Motusbank is relatively new when it comes to the best online banks in Canada. It’s owned by Ontario-based Meridian Credit Union which makes it a favourite for online banking in Ontario.
Motusbank offers chequing and savings accounts, as well as GICs, mortgages, financial planning and personalized investing, and an exciting partnership with Qtrade Direct Investing, our top recommended online broker.
Motus Bank has a leg up on the other online banks when it comes to travel to the USA. They offer access to over 40,000 ATMs, surcharge-free, in the USA through the Allpoint network. A handy benefit to have for anyone who travels frequently to the USA. Read my Motusbank Review here.
- Free US ATM access
- Qtrade partnership
- Good savings account interest rate
- Lower GIC rates
- Not all services are available in Quebec
Best Feature: Free ATM access in the US.
Motive Financial – Earn Interest on Online Chequing Account Balance
Motive Financial is one of the biggest online banks in Canada and is a division of the Canadian Western Bank.
Motive Financial offers a chequing account and a savings account, plus GICs, TFSAs, and RRSPs. New clients opening a Motive Savvy Savings Account will see an interest rate of 3% – a really good rate compared to many other online banks. Problem is, their overall fees make this service much less enticing.
Motive Financial lets you earn interest on your chequing account too. The Cha-Ching Chequing account will bring you 0.25% in interest. Check out my Motive Financial Review for full details.
- Chequing account earns interest
- Savings account has a great interest rate
- No monthly fees
- Additional fees can add up
- Limited transactions for savings accounts
Best Feature: Earning more than 0.01% interest on a chequing account.
Alterna Bank – Online Bank With a Qtrade Welcome Bonus
Alterna Bank is part of the Alterna Savings Credit Union, which is based in Ontario. They offer everyday banking accounts, mortgages, and investing options. Their HISA interest rate is higher than some of the others on this list, at 2.5%, but what really makes Alterna Bank stand out is their partnership with Qtrade.
While Motusbank has also partnered with Qtrade, Alterna is offering new investors up to $2,000 cashback if they open an account and invest $5,000 with Qtrade Direct Investing. Check out our Qtrade Review to see why they’re MDJ’s top recommended online broker in Canada.
- Competitive interest rate
- Qtrade welcome bonus
- Minimum investment of $5,000 to be eligible for the Qtrade bonus
Best Feature: A Qtrade partnership that gives you cashback.
Oaken Financial – Available in Quebec
Oaken Financial’s parent company is Home Trust, Canada’s largest independent trust company. It only has one savings account and some GIC options. However, what it lacks in product offerings it makes up for in value, with a standard interest rate of 3.4%.
The other thing that makes Oaken Financial a standout is that Quebec residents are able to open an account with them which is not the case for many other online banks in Canada.
- Excellent interest rate on savings account
- Available to Quebec residents
- No fees
- Business accounts available
- Only a few offerings
Best Feature: The excellent standard interest rate and the availability in Quebec.
Canadians are Turning to Online Banking
According to recent research by the Canadian Bankers Association (CBA) 78% of Canadians do most of their online banking digitally (via online and mobile banking).
While pandemic lockdowns sped up the shift to online banking, the experts say that the change is here to stay. And that makes sense because online banking is just a lot easier and more convenient for most of us.
Of course, direct banking in Canada isn’t the only way to bank online. The big banks, the brick-and-mortar ones, are going digital too.
Types of Online Bank Accounts
Unlike traditional banks, each online bank offers something a bit different. As you may have noticed from my mini-reviews, not every bank will offer all of the types of bank accounts listed below. For now, here are the main types of online bank accounts available in Canada.
- Savings Accounts that you can park your money in and earn a bit of interest at the same time.
- Chequing Accounts that allow for easy access to your money for monthly bills and daily expenses.
- High Interest Savings Accounts offer a higher interest rate than regular savings accounts. Online banks are known for having the highest interest rates in Canada.
- TFSA Accounts are Canadian government sponsored accounts that allow you to invest, save and grow your money tax free when you withdraw it up to a certain amount.
- Hybrid Savings and Chequing Accounts act like a savings account in terms of earning interest, but lets you spend like a chequing account.
- Investment Accounts allow you to easily invest your savings to help you plan for the future.
- Student Accounts work the same as regular chequing and savings accounts, and are a great way to help younger people become more financially savvy.
- Senior Accounts offer more discounts and freebies to help those in retirement save more money.
Advantages of Online Banking
- Convenient and time saving, as everything can be done online or through a mobile app.
- Higher interest rates than most brick and mortar banks.
- Saves money because you’re not paying fees so the banks can pay rent.
- Easy connectivity to other accounts, such as your investment account.
- High levels of security, similar to credit unions, so you know your money is safe.
Now, we’ll have a look at the areas online banks might not be up to par with brick and mortar banks.
Disadvantages of Online Banking
- Lacking in personal touch as you likely won’t be communicating with an actual person most of the time.
- Fewer ATMs available, which means you could end up spending more on ATM fees.
- Lacking in all-in-one packages that the bigger banks can offer.
- Limitations in terms of types of services offered.
Are Online Banks Safe?
Yes, online banks are safe! Many online banks are insured by the Canada Deposit Insurance Corporation (CDIC), which means that your deposits up to $100,000 are protected. Every bank on my list is either a CDIC member in its own right, or is part of a larger institution which is CDIC-affiliated.
In addition to the peace of mind you get from knowing your money is insured, you can also breathe easy knowing that online banks use the most up-to-date data encryption and other security measures to keep your accounts safe.
Furthermore, features like two-step authentication and automatic alters can help you make sure your account access stays in your hands only.
Online Banking in Canada: FAQ
Virtual Banks in Canada – No Fees and the Right Fit
To choose the online bank that is right for you, use the Canadian online bank comparison chart we compiled above to compare interest rates and banking fees.
For me, as someone who has opened up numerous online banking accounts in order to test their user friendliness firsthand, I just think the value proposition offered by EQ Bank is unbeatable at the current time. They have a unique combination of the best website for usability, lowest fees (no fees at all), excellent customer service, and are consistently at the top of the interest rate leaderboard (without teaser rates).
The one knock against EQ used to be that they didn’t have a card to go with their bank accounts. That all changed in 2023 with the launch of the EQ Bank Card, a prepaid card option that makes it easy to use your EQ account to buy directly from stores, etc.
Personally, I still think the combination of using an elite rewards credit card, and then auto-paying it with my EQ account gives the most bang for my bucks – but it never hurts to have more options.
Ultimately picking the best online bank for you comes down to your preferences. If no fees and high interest rates for Savings Accounts and GICs are your primary goals then your choice might differ from someone who really needs to be able to pull cash out of debit machines each week.
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Good article but one note I would add is that as far as I can tell, motusbank has the same partnership with QTrade Investor and VirtualWealth as Alterna Bank.