Banking 101 for New Canadians: Accounts, Fees and Tips
This article provides general information and is not financial advice. Always consult a qualified advisor for guidance specific to your situation.
Opening the right bank account is one of the first—and most important—financial tasks after arriving in Canada. The country's well-regulated, competitive system offers a mix of traditional banks, credit unions, and digital-only options. This guide breaks down account types, fee structures, newcomer packages, and smart ways to keep more of your money.
1. How Canadian Banking Is Structured
1.1 The Big Six Banks
| Rank | Bank | Quick-take |
|---|---|---|
| 1 | Royal Bank of Canada (RBC) | Largest by assets; broad branch network |
| 2 | Toronto-Dominion (TD) | Strong mobile app & U.S. presence |
| 3 | Scotiabank | Best international reach (Caribbean & LatAm) |
| 4 | Bank of Montreal (BMO) | Canada's oldest bank (est. 1817) |
| 5 | Canadian Imperial Bank of Commerce (CIBC) | Competitive newcomer offers |
| 6 | National Bank | Dominant in Québec; growing elsewhere |
1.2 Alternatives
| Option | Examples | Why consider |
|---|---|---|
| Credit unions | Vancity, Meridian, Coast Capital | Member-owned, often lower fees |
| Online-only banks | Tangerine, Simplii, EQ Bank | No branches → higher savings rates, $0 fees |
| Neo-banks / fintechs | KOHO, Neo Financial | App-based spending & savings, instant insights |
2. Core Account Types
2.1 Chequing (Everyday) Accounts
| Feature | Typical Range (2025) |
|---|---|
| Monthly fee | $0-$30 (first 12 mo. often free for newcomers) |
| Free transactions | 12 – unlimited |
| Out-of-network ATM | $2 domestic / $3-$5 abroad + FX markup |
| Minimum balance to waive fee | $3,000-$5,000 |
Tip: Debit cards run on the Interac network; credit transactions are separate.
2.2 Savings Accounts
| Type | Key Points |
|---|---|
| Standard Savings | 0.05 – 1 % interest, unlimited transfers to same bank |
| High-Interest Savings (HISA) | 3 – 5 % promotional, limited free withdrawals |
| TFSA | Tax-free growth, $7,000 contribution room for 2025 |
| RRSP | Tax-deductible deposits (18 % of 2024 income up to $32,490), withdrawals taxed later |
3. Best Newcomer Packages (No-Fee for 12 Months)
| Bank | Extras | After 12 mo. fee |
|---|---|---|
| RBC Advantage Banking (Newcomers) | 2 free international transfers/mo., entry-level credit card | $11.95 /mo. |
| TD Unlimited Chequing (New-to-Canada) | Safety deposit box 1 yr, first credit card no annual fee | $16.95 /mo. |
| Scotiabank StartRight | Unlimited Interac e-Transfers, free global money transfers | $16.95 /mo. |
| BMO NewStart | Preferred FX rates, 1-yr no-fee cash-back CC | $11.95 /mo. |
| CIBC Smart for Newcomers | Free Global Money transfers, newcomer advisors | $16.95 /mo. |
(Most require proof you landed in Canada within the last 5 years; always check current terms.)
4. Understanding & Avoiding Fees
| Fee | Typical Cost | How to Dodge It |
|---|---|---|
| Monthly maintenance | $4-$30 | Keep required balance or set up payroll direct deposit |
| Extras per transaction | $1-$1.50 | Choose unlimited account or track usage |
| Foreign ATM | $3-$5 + 2.5 % FX | Use partner ATMs or withdraw larger, less-frequent amounts |
| Wire transfer (outbound) | $15-$50 | Compare fintechs (Wise, Remitly) for cheaper options |
| Overdraft | Flat $5 + 21 % interest | Enable low-balance alerts; move TFSA cash instantly |
5. Opening Your First Account
- Book an appointment (video or branch).
- Bring ID: Passport + landing document (e.g., work permit, PR card). SIN is optional for opening but required for interest reporting.
- Proof of address: Lease, utility bill, or signed letter from landlord.
- Choose products: At minimum—a no-fee chequing and a HISA/TFSA.
- Fund & activate: Deposit cash or wire; set up online banking and Interac e-Transfer profile.
CDIC insurance: Deposits at member banks are protected up to $100,000 per category, per institution.
6. Digital Banking Must-Knows
| Feature | Why It Matters |
|---|---|
| Interac e-Transfer | Real-time CAD transfers via email/phone |
| Mobile cheque deposit | Skip branch visits—photograph & submit |
| Account alerts | SMS/email for low balance or large withdrawals |
| Budget trackers | Auto-categorise spending in most apps |
| Two-factor authentication | Standard for login & e-Transfer approval |
7. Common Mistakes (and Fixes)
- Leaving large cash balances in chequing → Move to HISA/TFSA.
- Not building credit → Start with a secured or low-limit credit card.
- Paying avoidable fees → Negotiate, maintain balance, or switch banks.
- Ignoring account changes → Banks can revise fees with 30-day notice—read emails.
- Overdraft surprises → Overdraft fees can hit $5-$45; set up alerts.
8. Setting Up for Major Goals
| Goal | Action Steps |
|---|---|
| Buying a home | Open a First Home Savings Account (FHSA)†; automate down-payment deposits. |
| Education savings | Investigate RESPs—20 % federal grant on contributions up to $2,500/yr. |
| Retirement | Contribute to RRSP for tax deduction; use TFSA for flexible investing. |
| Emergency cushion | Aim for 3-6 months of expenses in a HISA inside your TFSA. |
† FHSA launched 2023: contribute up to $8,000/yr, lifetime $40,000; deposits are tax-deductible, withdrawals tax-free for your first home.
9. Quick Money-Saving Checklist
- [ ] Use a newcomer package for $0 everyday banking in year 1.
- [ ] Set Interac e-Transfer Autodeposit to avoid phishing.
- [ ] Keep the minimum balance or set up payroll to waive fees.
- [ ] Move surplus cash to a HISA or TFSA each payday.
- [ ] Review fees every 12 months and switch if better deals appear.
Conclusion
Canada's banking ecosystem is newcomer-friendly—if you understand the rules. Choose a no-fee newcomer package, leverage digital tools, and keep an eye on fee notices. As your situation evolves, reassess and negotiate; loyalty rarely beats shopping around.
Ready to compare newcomer accounts? See our partner offers and open your first Canadian bank account in minutes.