Updated March 2025. The rise of online-only banking in Canada has given consumers more choice than ever. Online banks like KOHO, EQ Bank, Tangerine, and Simplii offer compelling advantages over the traditional Big 5. But traditional banks aren't going away — they offer services that digital-only banks can't match. Here's a complete breakdown.
KOHO is Canada's best online bank for everyday spending: $0 fees, cash back on groceries and gas, and powerful budgeting tools. Use code 45ET55JSYA for a sign-up bonus.
Get KOHO Free — Use Code 45ET55JSYA| Feature | Online Banks (KOHO, EQ Bank, etc.) | Traditional Banks (Big 5) |
|---|---|---|
| Monthly Fees | $0 (typically) | $11–$31 |
| Savings Rates | 2–4% (EQ Bank) | 0.05–1.05% |
| Cash Back on Spending | Yes (KOHO) | Credit cards only |
| Branch Access | No (or limited) | Yes (hundreds) |
| Cash Deposits | No (most) | Yes |
| Mortgages | Limited | Full service |
| Investments (TFSA/RRSP) | Some (EQ Bank) | Full service |
| Credit Cards | Limited | Full range |
| App Quality | Generally better | Improving |
| Customer Service | Chat/email | Branch + phone |
| CDIC Coverage | Yes (most) | Yes |
The average Canadian pays $180–$360 per year in bank fees. Online banks like KOHO, EQ Bank, Tangerine, and Simplii charge nothing for basic accounts. Over 10 years, that's $1,800–$3,600 saved.
EQ Bank pays 3.00–3.50% on everyday savings balances. Tangerine offers up to 6% for new clients. The Big 5 average 0.05–1.05%. The difference compounds significantly over time.
Challenger banks are built mobile-first. KOHO's budgeting tools, instant notifications, and spending analytics are more advanced than anything the Big 5 offer in their apps.
KOHO gives you 1–2% cash back when you use your Visa card for everyday purchases — no credit check required. Big 5 banks only offer cash back through credit cards.
Traditional banks offer mortgages, HELOCs, lines of credit, safety deposit boxes, and comprehensive investment accounts all in one place. Online banks are catching up but not there yet.
For Canadians who regularly receive or deposit cash, collect foreign currency, need notarized documents, or want face-to-face financial advice, branches are essential.
TD and BMO have full US banking subsidiaries. RBC has an international presence. Online banks typically cannot support cross-border banking.
Traditional banks have more robust credit underwriting for large loans. If you need a business line of credit, commercial mortgage, or complex financing, a Big 5 bank is the right starting point.
| Bank | Best For | Monthly Fee |
|---|---|---|
| KOHO | Spending, cash back, credit building | $0 |
| EQ Bank | Savings, GICs, TFSA/RRSP | $0 |
| Tangerine | Full digital banking, cash back credit card | $0 |
| Simplii Financial | No-fee banking, CIBC access | $0 |
| Wealthsimple Cash | Investing integration | $0 |
| Oaken Financial | GICs, savings | $0 |
Yes. Most Canadian online banks are either:
CDIC insures deposits up to $100,000 per insured category. Your money is as safe at EQ Bank as at a Big 5 bank.
Most Canadians benefit from a hybrid approach:
Information current as of March 2025. Rates and features change. Verify with individual banks.