How to open a fee free bank account in Canada: Guide and Options 2024

There are costs involved in offering chequing account products, which mean that finding truly fee-free account options is pretty tricky to do. Most of the major banks in Canada have basic accounts which have low monthly fees and are aimed at people who don’t need to transact often. In some cases monthly charges are waived if you fulfil eligibility criteria - but for most customers that will mean maintaining a fairly high monthly balance.

On top of any ongoing charges, there are also transaction fees which you’ll pay any time you exceed the day to day transactions offered with your account plan, or when you’re looking for more complex services like international transfers. This can push up costs even further.

Balancing the options to find a low cost account which still has all the services you need is essential if you want to keep more of your money. One alternative is to turn to an online provider like Wise or Tangerine. Fintech companies like these can help you cut costs and offer better value overall. This guide covers all you need to know.

Fee free account options in Canada:

• Accounts from fintech companies

• Bank chequing accounts

Best fee-free account offers in Canada

Unfortunately, accessing financial services is going to mean incurring some fees - whether they’re ongoing charges or costs for specific transaction types. But cutting out as many costs as possible is still a very attractive option if you want to make more of your hard earned dollars.

In this guide we’ve compared a few different options, looking at accounts from both fintech companies and banks, and analysing their products based on whether they have the following:

• Account opening fee

• Monthly charges

• Interest earning opportunity

• ABM withdrawal fees

• Foreign transaction fee

• International money transfer charges

• Account closure fee

Let’s dive in.

Fee-free accounts from neobanks and fintech companies 

Let’s start with a modern way to cut the costs of managing your money - innovative account products from digital banks or fintech companies.

Here you’ve got a couple of main options - fintech companies like Wise, or digital banks like Tangerine. Neither have a branch network, which means lower overheads. You manage your account online or with your phone in most cases - and you may find your account comes with lower fees and a range of features that’s not necessarily on offer from most basic accounts from brick and mortar banks.

Here’s a look at how Wise and Tangerine accounts measure up in terms of key features and fees:

Pros and cons

Pros:

• No monthly fees and low costs for transactions

• Innovative account features

• Convenient ways to manage your money online and with your smartphone

Cons:

• You won’t usually get face to face service

• Your options for cash deposits are limited

• Not all services that are offered by a traditional bank will be available

Fee free bank chequing accounts

Regular banks in Canada don’t usually offer accounts with no monthly fees. However, there are accounts which have either low monthly charges, or which offer some ways to have the monthly costs waived.

If you’re looking for an account with no monthly fees at all you’ll need to shop around. Some banks offer fee free accounts to certain groups of people - like retirees and students for example, while others ask you to sign up for additional services to get monthly costs refunded or waived.

Here’s a summary of the key features of basic bank accounts from some of Canada’s largest banks.

Pros and cons of bank chequing accounts

Pros:

• Full range of financial products and services on offer

• Branch network available for face to face transactions

• Some monthly fees are waived for eligible individuals

Cons:

• Transaction fees can be high - only a handful of transactions are offered with many plans

• International transactions are especially costly

• You may need to maintain a high minimum balance to have account costs waived

To sum up: Which account and provider is right for you will depend a lot on how you like to manage your money, and the type of transactions you need to make.

If you prefer to get in-branch service then you’ll probably find a regular bank suits you best. However, because each bank has its own eligibility requirements if you want accounts with monthly fees waived or refunded, you’ll need to shop around to find the best fit for you.

For people who prefer to manage their money digitally, fintech and digital providers are a good option, with no monthly fees and no minimum balance requirement. Depending on what you need from an account you may also find you get extra features like low cost currency conversion or interest on your account balance. Compare a few different account options to see how they match your needs.

How to choose a fee-free bank account?

We’ve already covered the fact that fee-free accounts don’t really exist. However, it is possible to get an account which offers a good range of features with no ongoing fees - and then you can keep costs down even further by thinking carefully how you transact and avoiding high-fee transaction types.

To find the right account for your needs you’ll need to think through the transactions you’ll want to make frequently - and whether you’re willing and able to leave a fixed minimum deposit in your account. Check service fees for your common transactions before you make a decision on which account to open - looking especially at international costs and out of network or overseas ABM withdrawals, which can be especially pricey.

Documents and eligibility

Normally to open an account from a regular bank you’ll need to provide 2 different documents:

• One which shows your name and address

• One which shows your name and date of birth

If you’re a Canadian citizen you’ll be able to choose documents like your passport or government issued ID, tax assessment notices, public utility bills or recent statements of government benefits. If you’re a foreigner in Canada you’ll need to provide proof of your identity and - often - proof of your legal right to be in the country. Check with your bank to see which documents exactly they require based on your specific circumstances.

If you’re applying for an account from a specialist online service like Wise you’ll need to provide proof of ID and address. If you’re not based in Canada you may be able to use a foreign proof of ID to get your account set up.

When you might need a fee-free basic bank account

Fee free bank chequing accounts are perfect for people who want to keep down the costs of managing their money - particularly if they don’t need to make so many transactions every month. Basic accounts usually come with a low level of free transactions, so if you’re transacting regularly you may actually be better off upgrading to a fee paid product.

In many cases, fee free accounts are great for students, pensioners, anyone on a fixed income, and anyone with fairly basic CAD banking needs.

Options when we can't get a fee-free with your bank

One common reason to be looking for a fee-free CAD account is if you’ve just arrived in Canada as an expat or international student. In this case, a traditional bank may prove tricky as you won’t necessarily have a proof of address in your name just yet.

The good news is that there are easy online alternatives like Wise, which can often help you to open an account with your normal proof of ID and your home proof of address, even if it’s outside of Canada. Open a Wise account before you travel to Canada, to get instant access to CAD bank details to pay and get paid like a local.

Conclusion

You won’t be able to remove all the costs of managing your money - but you can cut them significantly by making smart choices about which accounts you open, and how you transact.

Finding an account with no monthly fees - or which allows you to waive the ongoing costs without too much drama - can save you a lot. And paying attention to the transaction costs for using your account is also important. Some more complex services like making international payments can come with high fees, which push up your overall costs. Use this guide as a starting point to pick the account which best meets your needs.