Canada is a country that shares boundary with the United States of America and it is an amazing place to work, study or live there. In case you are thinking about moving to Canada, then you may surely want to open a bank account before arriving in the country.
Well it is necessary we let you know that opening a bank account in Canada is challenging if you are not yet a resident of the country but it is not impossible.
Want to open a bank account in Canada? it is a little difficult to open a bank account in Canada but contacting a Canadian bank and requesting their assistance could get you the result you will need and your success in opening an account in Canada could also depend on your country of origin like for example, it is likely to be easier to open an account from the US due to the already existing relationship between the 2 countries.
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Banking System in Canada
Canada features among the well developed nations of the world and so for this reason, it is of no doubt that their banking sector should also find a spot among the best around the globe.
The banking system in Canada is well developed due to its numerous economic activities, business men and the companies fond in the country. Canada has one of the most accessible banking systems in the world, with more than 99 percent of Canadian adults having a bank account.
There are 40 banks in Canada that offer financial products and services to Canadian consumers, such as bank accounts, credit cards, loans, and investments. The percentage of Canadians who do not pay service fees for their banking is 31%.
Residential mortgage debt accounts for 74% of all household debt in Canada, which helps increase net worth, while lines of credit account for 16% and credit card debt accounts for 4%.
Canadians are cautious borrowers, and mortgage arrears in Canada continue to be very low (in fact, as of December 2021 only 0.17 percent of bank mortgages are in arrears).
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What Do I need to Open a Bank Account in Canada?
Every bank in Canada has its own specific documentations and identity requirements if you want to open a bank account.
However, even though each bank in Canada has its own more or less requirements, there are still some basic requirements that is common to every bank in Canada. Below is a brief list of what you will need to provide in order to open a bank account in Canada:
- A government issued photo ID such as passport or driver's License
- A permanent resident card or an immigration card, Refugees and Citizenship Canada (IRCC) form IMM 1000, IMM 1442 , or IMM 5292.
- A bank, credit or debit card
- Some identifications issued by State or provincial authorities
- Various other ID documents
- A social Insurance Number Card which is issued by the Government of Canada
As part of your ID requirements you may have someone in good standing with the financial institution or in the community confirm your identity. Surely, the best option that you can have to open a Canadian bank account as a non resident is to contact a Canadian bank and ask about the options they have available.
Types of Bank Accounts in Canada
It might somehow shock you to know that there are 2 main types of bank accounts in Canada which are Chequing accounts and Savings Accounts, but among these 2, there still exist numerous variations such as business or student chequing accounts and high tax interest or tax free savings accounts.
1. Chequing Accounts
A chequing account is one that is made for your day to dat banking needs as it allows you to easily transact with money that you deposited into the account. So we can see that this chequing account in Canada is just like the current account in other countries.
With this account, you are able to pay people and businesses through cheque, receive direct deposits, make withdrawals (both in person and at ATMs), buy goods and services using a debit card and many more.
Most often, chequing accounts earn little or even no interest a the account is not designed to hold large amounts of money over a large period of time- instead this is the main use of a savings account. So in conclusion, a Chequing account is mainly an account typed that holds money you are able to access easily and for daily spendings.
Most individuals in Canada are in possession of a Checking account as it helps them to pay their bills, make purchases and have easy access to cash that will sponsor their daily expenditures.
Kinds of Chequing Accounts
In Canada, there exist many types of chequing accounts and they include:
- U.S dollar checking account that allows you to easily transact in US dollars
- A joint checking account which is accessible by more than one person and the 2 owners of the account before money is withdrawn from the account
- Business Checking account which meant to differentiate between business transaction and personal ones
- Student checkinging account designed mainly for those in post secondary schools and also for the international students that come to further their studies in Canada.
2. Savings Accounts
Here comes another basic account in Canada that allows you to grow your money by accumulating the interest. Savings account are not meant to be as fluid as checking accounts- this simply means that they are not designed to make day to day banking transactions or to provide access to funds quickly via an ATM.
The advantage of a savings account is that they do not have a monthly maintenance fee but they also allow only a low number of transactions per month - sometimes as small as one withdrawal or transfer per month.
Savings accounts are a good option for people who are saving money or working toward a specific financial goal and want to earn interest to help them get there faster. They're also a good option for money that needs to be accessible quickly, such as an emergency fund. Savings accounts allow your money to grow over time because they earn interest.
Kinds of Savings Accounts
- Joint Savings account which is owned and accessible to more than one person
- High interest Savings account or HISA
- Registered Savings account
- Business Savings account
- Children's Savings account
How to Open a Canadian Bank Account as non Resident
Before considering opening an account for you, most Canadian banks will require you to be a resident of the country. To proceed with your bank account application, you'll need proof of address, identity documents, immigration documents, and a government-issued reference number. That isn't always the case, and we've included some other options below.
Options for Opening an Account in Canada
Below are the various choices that you have as a non resident to open a bank account with a bank in Canada as a non resident:
1. Make use of a Correspondent Bank
There are numerous banks that already have existing relationships with banks in Canada and if that is the case with your actual bank in your country, you can get closer to your home bank and ask for their assistance in opening a Canadian bank account.
But it is also necessary to have in mind that not all banks have these relationships and even if they do have a relationship, some banks may not still allow you to open an account.
2. Talk to a Canadian Bank About Opening an Account as a Non Resident
This is one of your best alternatives. It's always worth contacting a Canadian bank and asking if you can open an account outside of Canada, especially if you plan to relocate there soon. They might be able to work with you.
3. Open A wise Multi-Currency Account
A Wise Multi-Currency Account, which is often the simplest way to open a Canadian account without traveling to the country, allows you to open a "virtual" account in Canada that you can then use as a regular bank account.
4. You Can Open an International Account
This is where you open an account with a Canadian bank outside of Canada. You must typically be a high-net-worth individual, deposit a large sum of money, and maintain a high balance in the account.
Best Banks in Canada
Well since the Canadian banking sector is well established, numerous banks often find it a good idea to settle in Canada or better still have one of their branches in Canada and as a result of these, choosing a bank in Canada is not easy since you got several best options to select from.
But when you have to choose a bank account, you should consider factors like fees, and accessibility so as to ensure you are not loosing money to the area that is meant to keep your money safe and secured.
In Canada, you will most here of the "Big 5" banks that are nationally known and have the biggest presence across the country. Below is the list of the best banks in Canada:
1. Royal Bank of Canada
This is the largest bank in Canada and it was founded in the year 1864 and today, the bank counts more than 16 million customers worldwide and offers numerous account options such as chequing accounts, student accounts, savings accounts, accounts for new immigrants to Canada and even U.S dollar accounts.
Due to the fact that it is the largest bank in Canada, you will not expect low fee here. Fess for their chequing accounts ranges from $4 a month to $30 a month.
Its history of stability and size make it a popular bank in Canada, especially given that it has the country's largest branch and ATM network, with over 50,000 ATMs available to customers for no-fee withdrawal. RBC provides insurance products, an investment platform, and wealth management services in addition to checking and savings accounts.
2. Toronto Dominion Bank
TD Bank is Canada's second-largest bank, with more than 25 million customers all over the world. TD has more than 1,100 branches in Canada and an ATM network of 2,800 machines across the country, in addition to being well-represented internationally. In 1855, TB Bank was founded in Toronto.
TD offers a wide range of accounts, including chequing accounts with monthly fees ranging from $3.95 to $29.95, savings accounts, student accounts, youth accounts, US dollar accounts, and "New to Canada" accounts. It also provides credit cards, mortgages, loans, insurance, retirement products such as RRSPs and TFSAs, and investment options.
3. Scotia Bank
Since 1832, Canada's third-largest bank has served over 25 million customers around the world. It offers a wide range of financial products, has a long track record of stability, and has thousands of physical bank branches as well as a network of over 3,500 ATMs across Canada.
Chequing accounts, savings accounts, student accounts, and senior accounts are among the six types of bank accounts offered by Scotiabank. Its monthly fees for chequing accounts range from $3.95 to $30.95 for their perk-heavy Ultimate Account. It also provides 18 different types of credit cards, such as no-fee cards, cash-back cards, and travel rewards cards.
4. Bank of Montreal
The Bank of Montreal, which is Canada's fourth-largest and oldest bank, was founded in Montreal in 1817. In Canada, the bank has more than 7 million customers and 939 branches, as well as a network of over 2,000 ATMs.
The Bank of Montreal provides a wide range of checking and savings accounts, including student accounts, accounts for newcomers to Canada, and personalized banking for indigenous community members.
The bank's checking account fees range from $0 to $15.95 per month for accounts with more advanced features, such as a $350 opening bonus and a free US dollar savings account. Mortgages, credit cards, loans, insurance, financial planning services, and investment options through accounts such as RRSPs and TFSAs are examples of other financial products.
5. Canadian Imperial Bank of Commerce
The Canadian Imperial Bank of Commerce is Canada's fifth-largest bank and has been in operation since 1961. It has over 11 million customers all over the globe, more than 1,100 branches in Canada, and a network of over 3,700 ATMs.
The Canadian Imperial Bank of Commerce offers a variety of checking and savings accounts, including student and senior accounts, as well as accounts in US dollars and accounts for foreign workers.
Checking account fees range from $3.90 to $29.95 per month. CIBC provides traditional financial products such as mortgages, loans, and insurance, as well as retirement products such as TFSAs and RRSPs, in addition to banking accounts.
Best Online Banks in Canada
- Manulife Bank
- EQ Bank
Final Thoughts on How to Open a Bank Account in Canada as Resident and as non Resident
Canada is a country that shares boundary with the United States of America and it is an amazing place to work, study or live there. In case you are thinking about moving to Canada, then you may surely want to open a bank account before arriving in the country. Well it is necessary we let you know that opening a bank account in Canada is challenging if you are not yet a resident of the country but it is not impossible.
So depending on your country or origin if you will be moving to Canada anytime soon, you can check out the steps in this article to help you open a bank account in Canada with ease. You have to select the bank that suits you best while also taking into consideration its fees and accessibility.
Frequently Asked Questions
Can I open a Canada bank account online?
You will need to present valid identification if you want to create a bank account in Canada. You can open a checking account online without having to wait till you get in the nation.
What documents are required to open a bank account in Canada?
Two types of legitimate identification, such as a passport, national ID card with a photo, or driver's license, are required for account opening. Additionally, you'll need to provide verification of your residential address, such as a voter's card or utility bill. The Royal Bank of Canada does offer specialized assistance to foreign nationals..
How long it takes to open a bank account in Canada?
Opening a bank account is a speedy process if you have all the required paperwork on hand. Once in the bank, opening an account will take an average of 15-20 minutes, and you will be handed your debit card at the branch
Can I open a bank account in Canada without being a resident?
According to the Government of Canada, non-residents holding Temporary Resident Visa or tourists also have the right to open a bank account or apply for mortgages in Canada.
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