Big Five Banks vs Digital Banks in Canada: A Newcomer's Guide
Opening a bank account is one of the first things every newcomer to Canada has to do — payroll deposits, rent payments, and building a credit history all run through it. Canada's banking landscape has two main camps: the Big Five (RBC, TD, Scotiabank, CIBC, BMO), with newcomer packages and branch networks across the country, and digital banks like Tangerine, Simplii Financial, Wealthsimple Cash, and EQ Bank, with zero monthly fees and higher savings rates. Here is how they compare on fees, newcomer offers, branch access, and deposit insurance — and which mix makes sense for your first year.
The Big Five: newcomer packages and branches
RBC, TD, Scotiabank, CIBC, and BMO dominate Canadian banking, and all run dedicated newcomer programs. The headline perk: your monthly chequing-account fee is typically waived for 12 months. Some programs run longer — Scotiabank's StartRight waives fees for about two years, and CIBC offers around 24 months of fee-free banking for newcomers. Once the promo period ends, standard chequing fees run roughly $11–$30 per month, unless you keep a minimum balance (usually $3,000–$5,000) to get the fee rebated.
The deeper reason many newcomers start with a Big Five bank is the credit card: newcomer programs routinely approve a first credit card with no Canadian credit history, which starts your credit file from day one. You can often begin the application online before you land, or walk into a branch after arrival with your passport plus an immigration document (PR card, work permit, or study permit). A Social Insurance Number (SIN) is not always required at the application stage, but you will need one soon after — banks must report interest income, and you need it for work and taxes regardless.
The digital banks: zero fees, no branches
Tangerine (owned by Scotiabank) charges $0 per month forever, includes unlimited transactions, and gives free access to more than 3,500 Scotiabank ATMs. Tangerine Bank is itself a CDIC member, so its deposits are covered directly. Simplii Financial, a division of CIBC, follows the same formula: $0 per month, unlimited transactions, and free access to 3,400+ CIBC ATMs, with CDIC coverage through CIBC. EQ Bank (the trade name of Equitable Bank) is a direct CDIC member as well. Wealthsimple Cash, now branded as a chequing account, is also free — with one important nuance on deposit insurance, covered below.
The other draw is interest: digital banks consistently pay far higher savings rates than the Big Five's standard savings accounts, which often sit at 0.05%–0.50%. Promotional rates (for example, around 4.5% for the first five months) change frequently, so check the official site before you compare.
Big Five vs digital banks: the comparison
| Big Five banks (RBC, TD, Scotiabank, CIBC, BMO) | Digital banks (Tangerine, Simplii, EQ Bank, Wealthsimple Cash) | |
|---|---|---|
| Monthly fee | $0 for 12–24 months (newcomer promo), then ~$11–$30 unless a $3,000–$5,000 minimum balance is kept | $0/month forever, no minimum balance |
| Newcomer offers | Dedicated packages: fee waiver plus a first credit card with no Canadian credit history | No formal newcomer programs, but accounts are easy to open online |
| Branches | Thousands of branches and advisors across Canada | None — app and chat support only |
| ATMs | Large own-brand networks nationwide | Free at parent-network ATMs (Scotiabank for Tangerine, CIBC for Simplii); EQ Bank and Wealthsimple rely on partner networks |
| Savings interest | Standard rates often 0.05%–0.50% | Typically much higher; promos change — check the official site |
| Deposit insurance | All are direct CDIC members | Tangerine and EQ Bank: direct members. Simplii: covered through CIBC. Wealthsimple: cash held in trust at CDIC member institutions (see below) |
| Certified cheques / bank drafts | Available in branch | Hard to obtain — a real limitation |
| Best for | Year one: newcomer package + first credit card + in-person help | Everyday banking and savings at zero cost |
CDIC coverage: the details that matter
Deposit insurance is worth understanding before you park a large sum anywhere. The Canada Deposit Insurance Corporation (CDIC) protects eligible deposits up to $100,000 per depositor per member institution — free and automatic. All Big Five banks, Tangerine Bank, and Equitable Bank (EQ Bank) are direct CDIC members.
Simplii Financial is not a separate bank — it is a division of CIBC, so your Simplii deposits are covered under CIBC's CDIC membership. Wealthsimple is the special case: it is not a bank and not a direct CDIC member. Your cash is held in trust for you at CDIC member institutions, covered up to $100,000 per beneficiary per member institution — and up to $1,000,000 in total when spread across as many as 10 partner institutions. The coverage is free and automatic.
What you need to open an account
For a Big Five newcomer account: your passport plus an immigration document (Confirmation of Permanent Residence, PR card, work permit, or study permit). Many banks let you start the application online before landing. You can add your SIN later, but get it as soon as possible — you need it for a job and for taxes anyway.
Digital bank accounts open entirely online: government-issued photo ID plus your SIN for tax reporting. There is no credit check to open a basic chequing account — but it will not build your credit history, either.
The strategy most newcomers use
The practical consensus: open a Big Five account in year one for the newcomer package and the first credit card, and pair it with a digital bank account for fee-free everyday banking and higher savings interest. When the Big Five fee waiver expires, either keep the minimum balance, downgrade to their cheapest tier, or close the chequing account and keep just the credit card. That first newcomer credit card — the start of your Canadian credit file — matters more for your financial future here than which chequing account you pick.
Frequently asked questions
Can I open a Canadian bank account before I arrive?
Yes, with the Big Five. RBC, TD, Scotiabank, CIBC, and BMO all let newcomers start an application online from abroad; you complete the verification with your passport and immigration document after landing. Digital banks generally require you to be in Canada with a Canadian address.
Do I need a SIN to open an account?
Not always at the application stage — Big Five newcomer programs will often open the account on your passport plus immigration document. But you should get your SIN immediately after arrival: it is required for any interest-bearing account's tax reporting, for employment, and for government benefits.
Is my money safe at a digital bank?
Check whether the institution is a direct CDIC member (Tangerine, EQ Bank), covered through a parent bank (Simplii via CIBC), or uses the trust model (Wealthsimple, where cash is held at CDIC member institutions up to $100,000 per beneficiary per institution). All three structures carry CDIC protection; the limits and mechanics differ, so read the details before depositing a large amount.
Why do I need a Big Five account at all if digital banks are free?
Two reasons: the newcomer credit card, which starts your Canadian credit history, and in-person services — certified cheques, bank drafts, and face-to-face help with mortgages or investments later. Digital banks cannot easily provide those.
What happens when my newcomer fee waiver expires?
The account converts to the standard fee (roughly $11–$30 per month) unless you keep the minimum balance for a fee rebate. Before that happens, decide: keep the balance, switch to a cheaper tier, or move your daily banking to a free digital account and keep the Big Five relationship for the credit card.
Which digital bank should I pick for savings?
Compare current rates rather than brand names — promotional rates change often, so check the official site. Tangerine and Simplii suit daily banking with their parent-bank ATM networks; EQ Bank and Wealthsimple Cash are strong for parking savings at higher interest. Make sure you understand each one's CDIC coverage before depositing a large sum.
Sources
- Money Map Canada, Newcomer Bank Account in Canada: A Complete Guide: https://www.moneymapcanada.com/blog/newcomer-bank-account-canada
- Live in Canada, Newcomer Bank Account Guide: https://www.liveincanada.ca/posts/newcomer-bank-account-guide
- CDIC, What's Covered: https://www.cdic.ca/depositors/whats-covered/
- Wealthsimple Help Centre, How We Keep Your Money Safe: https://help.wealthsimple.com/hc/en-ca/articles/360056590614-How-we-keep-your-money-safe
- Retire Smarter, Simplii vs Tangerine: https://www.retiresmarter.ca/banking/simplii-vs-tangerine/
This article is general information about banking in Canada, not professional financial or legal advice; for your personal situation, consult a licensed professional.