How to Switch Banks in Canada 2025: Step-by-Step Guide
Updated March 2025. Switching banks in Canada is easier than most people think, but it requires some planning to avoid missed payments or bounced transactions. This step-by-step guide walks you through everything you need to do to switch smoothly — whether you're moving from a Big 5 bank to a digital alternative or switching between traditional banks.
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Before You Switch: Know Why You're Switching
Common reasons Canadians switch banks:
- Tired of paying $11–$31/month in chequing fees
- Want higher savings rates
- Moving to a new city where current bank has fewer branches
- Looking for better cash back rewards
- Better mobile app and digital experience
- Need US banking capabilities
- Credit building features
Whatever your reason, the process is the same.
Step 1: Open Your New Account
Open the new bank account before closing your old one. Keep both accounts running simultaneously for at least 2–3 months during the transition. You'll need your new account number and transit/institution number for the steps below.
For KOHO: Download the app, sign up in 5 minutes. For traditional banks: apply online or in-branch.
Step 2: Make a List of Everything Connected to Your Old Account
Go through your last 3 months of bank statements and identify every recurring payment and deposit:
- Direct deposits: Employer payroll, government benefits (CPP, OAS, EI, child benefits), pension
- Pre-authorized debits: Rent/mortgage, utilities, insurance, subscriptions, gym memberships, phone bills
- Automatic savings transfers
- Bill payments: Credit cards, phone, internet, condo fees
- Standing orders
- Any investment account contributions
Step 3: Update Your Direct Deposits
Contact each payer and provide your new bank account information:
- Employer: Submit a direct deposit update form (usually through HR or payroll system). Allow 1–2 pay cycles to take effect.
- CRA/Government benefits: Update through My CRA Account online or call 1-800-959-8281. Update takes 1–2 payment cycles.
- Other sources: Contact each payer directly
Do not close your old account until you've confirmed the first deposit has arrived at the new account.
Step 4: Update Pre-Authorized Payments
Contact each payee individually with your new account information. This is the most time-consuming step. Prioritize:
- Rent or mortgage (critical — get this right first)
- Utilities (hydro, gas, water)
- Insurance (home, auto, life)
- Phone and internet provider
- Streaming and subscription services
- Credit card automatic payments
- Investment contributions
Allow 1 billing cycle for each update to take effect. Keep your old account funded in the meantime to catch any that haven't updated yet.
Step 5: Transfer Your Balance
Once all direct deposits and pre-authorized payments have been successfully moved:
- Transfer your remaining balance to the new account via Interac e-Transfer or EFT
- Keep a small buffer in the old account ($100–$200) for any stragglers
Step 6: Run Both Accounts in Parallel (1–3 Months)
This is important. Keep your old account open and funded for 1–3 months after you think everything has been transferred. Reasons:
- Some businesses update slowly
- Annual subscriptions may only charge once a year
- Government payments can take multiple cycles
- Any missed pre-authorized payment will go to the old account
Step 7: Close Your Old Account
After 2–3 months with no activity on the old account (no incoming or outgoing payments), you can close it.
- In person: Visit a branch and request account closure. Bring ID.
- Online: Some banks allow online closure requests; check with your bank.
- By phone: Call your bank's customer service line.
- Get confirmation in writing that the account is closed
- Withdraw any remaining balance before or during closure
Common Switching Mistakes to Avoid:
- Closing old account before moving all payments (missed payments, late fees)
- Forgetting annual subscriptions
- Not updating CRA — government benefit payments missing
- Not updating employer payroll — missed paycheque to old account
- Not keeping a buffer in old account during transition
Switching to KOHO: What to Know
KOHO is a prepaid Visa account, not a traditional bank account. A few things to note:
- KOHO has a transit number and account number — most pre-authorized payments work
- Some payees (particularly government) may require a "void cheque" — KOHO provides a Direct Deposit Form with equivalent information
- KOHO cannot receive wire transfers in some cases — check your specific needs
- No cash deposit capability — for cash, use a secondary account at Simplii or Tangerine
How Long Does Switching Banks Take?
| Task | Time Required |
|---|
| Opening new account | Same day (KOHO, Simplii, EQ Bank) |
| Updating employer payroll | 1–2 pay cycles (2–4 weeks) |
| Updating CRA | 1–2 payment cycles |
| Updating individual payees | 1 billing cycle each |
| Full transition complete | 2–3 months |
What to Do With Your Old Account's Rewards
Before closing your old account, make sure to:
- Redeem any accumulated credit card or loyalty points
- Cash out any pending cash back
- Transfer any investment account proceeds (these transfer separately, not with the bank account)
- Cancel any linked credit cards or overdraft products if desired
Guide current as of March 2025. Banking product availability and switching processes may vary by institution.