Aside from a chequing account, a savings account is a staple in the average Canadian’s banking repertoire. These types of accounts are designed to give you a place to stash your cash that you don’t need to withdraw right away while paying you a small amount of interest on the funds deposited. Rather than tucking your capital under your mattress, a savings account lets that money grow, even if it’s just a little while keeping it in a safe place.
Savings accounts are available from big banks, but these days, consumers can set up savings accounts that are dealt with entirely online. They offer competitive interest rates, no monthly fees, and a convenient platform to interact on.
We’ve reviewed the best online-only savings accounts that offer competitive interest rates and ideal terms and have hand-picked the best of the bunch.
Best Online Savings Accounts
| Fees | Min. Balance | Interest Rate | Transactions | e-Transfers | |
| Neo MoneyTM Account | $0 | None | 2.25%* | Unlimited | Unlimited & Free |
| Simplii Financial | $0 | None | 0.40% (5.25%1 for new clients) | Unlimited | Unlimited & Free |
| EQ Bank | $0 | None | 2.50% | Unlimited | Free |
| Tangerine | $0 | None | 0.10% | Unlimited | Unlimited & Free |
| Wealthsimple | $0 | None | 0.50% | Unlimited | Free |
| Motive Financial | $0 | None | 3.00% or 0.50% | – 2 free monthly drawals – Free between Motive accounts | $1.00 per transfer |
| MAXA Financial | $0 | None | 2.60% | N/A | N/A |
| Alterna Bank | $0 | None | 2.00% | Unlimited | Unlimited & Free |
1Interest is paid monthly and calculated daily on the total closing balance. Rates are subject to change without notice.
Neo Money™ Account
Neo Financial, a tech company in Canada, is challenging the way Canadians traditionally bank. Through their Neo Money™ account, Canadians can now save and spend all from the same account. When you open a Neo Money™ account, you can earn a high-interest rate of 2.25%* on your balance without any annual or monthly fees. Interest is paid monthly and there are no minimum balance requirements. However, there is a cap of $200,000.
Plus, you can access the money in your Neo account with the Neo Money™ card. This card works like a prepaid credit card and is better than a typical debit card. Again you’re getting the best of both worlds. You can earn up to 15% cashback on your first-time purchases at over 10,000 Neo partners and enjoy an average of 5% cashback.
The Neo Money™ account is a hybrid between a high-interest savings and an everyday spending account. You can use it to save money, pay bills, and send Interac® e-transfers for free. Other perks include unlimited free transactions, CDIC deposit protection2 (up to $100,000), and easy funding. You can fund your account through e-transfer, direct deposit or by linking an external bank account to your Neo account.
| Daily Interest Rate | Minimum Balance | Monthly Fee | CDIC insured |
| 2.25%* | No minimum balance | No monthly fees | Yes2 |
Sign Up Bonus
Open a Neo Money™ account today and receive a $5 bonus3.
Simplii Financial™ Savings Account
Simplii Financial is a popular online bank among Canadians thanks to its myriad of banking products and affiliation with CIBC, a well-established bank in Canada. Simplii™ offers a high daily interest rate of 0.40%. There is no minimum balance required, no monthly fees, and you can set up automatic deposits to make saving a breeze.
- New client offer – Earn 5.25% interest for 5 months on your first Simplii Financial High Interest Savings Account. Limits apply.
- Daily interest rate of 0.40% to 2.00%
- No minimum balance
- No monthly fees
- No transaction fees
- Automatic deposits
- CDIC insured
Tangerine Savings Account
One of the first online-only banks to hit the scene is Tangerine. It was formerly ING Direct but is now owned by Scotiabank. It offers a plethora of products similar to what you’d find with a traditional brick-and-mortar bank. Among the more popular banking products offered by Tangerine is its high-interest savings account. While typical savings accounts pay out very little in interest, Tangerine’s rates are much more competitive.
Tangerine’s savings account allows you to set a savings goal and track your progress. The Automatic Savings Program (ASP) is available for free. It allows you to transfer funds from your checking account to your savings account regularly. This will help you achieve your financial goals even faster. Simply establish the amount and frequency of these transfers and watch your savings automatically grow without any intervention or effort.
- Earn this special rate on deposits made into any other savings accounts up to the maximum according to the account type
- Earn 1.00% interest
- No service charges
- Automatic Savings Program (ASP)
- No minimum balance required
Wealthsimple Cash Savings Account
Wealthsimple is an online investing platform that not only offers digitally-savvy investors a way to grow their money through passive investing but also offers an online banking platform that includes high-interest savings accounts. You can then connect your savings account to any investment accounts you may have with Wealthsimple to help you grow your money faster.
Account holders can take advantage of free and unlimited withdrawals, no minimum balances, and competitive interest rates. Plus, the Wealthsimple Cash savings account acts somewhat like a checking account to simplify your banking. You can save and spend, all with one Wealthsimple Cash account.
- No monthly account fees
- No low balance fees
- Earn 0.50% interest
- Withdraw cash from ATMs across Canada
- Free deposits, transfers, and transactions.
- Send money with e-transfers
- Encrypted data
- CIPF protected
- Connect your savings account to an investment account
EQ Bank’s Savings Plus Account
EQ Bank is a trademark of Equitable Bank, one of the bigger banks in Canada that’s been around for decades. With little overhead thanks to its online-only business model, the bank passes its savings onto customers in the form of high-interest rates. In fact, EQ Bank offers one of the highest interest rates for savings accounts at an impressive 2.50%* In addition to its high rates, the digital bank is also known for its easy sign-up process and free transactions, and free transfers.
The EQ Bank’s Savings Plus Account comes with the following features:
- Everyday interest of 2.50%*
- No monthly fees
- No minimum balance
- Free EQ to EQ account transfers and electronic fund transfers
- Free bill payments
- Cheap international money transfers
*Interest is paid monthly and calculated daily on the total closing balance. Rates are subject to change without notice
Motive Financial Savvy Savings Account
Formerly known as Canadian Direct Financial (CDF), Motive Financial is an online-only bank that offers high-interest rates on its savings accounts. Depending on your account balance, you can earn between 1.100% and 0.500% interest. Not only that, but Motive’s savings account comes with no minimum balances or monthly fees, free Interac e-transfers, and insures your funds through the CDIC.
- Earn between 1.100% – 0.500% interest
- No minimum balance
- No monthly fees
- Free deposits
- Unlimited transfers between accounts
- 2 free transactions a month
- Free Interac e-transfers
- CDIC insured
MAXA Financial High-Interest Savings Account
MAXA Financial is a digital bank that offers great interest rates on its high-interest savings account at 1.00%. A division of Manitoba-based Westoba Credit Union Ltd, MAXA Financial also offers investment products to help you grow your money faster and help you reach your financial goals a lot sooner. Plus, deposits held with MAXA Financial are protected by the Deposit Guarantee Corporation of Manitoba, so your funds are always safe.
- Earn 1.00% interest
- No minimum balance
- No monthly fees
- MAXA MemberCard available for ATM and purchase transactions
Alterna Bank Savings Account
A subsidiary of the century-old Alterna Savings, Alterna Bank is an online bank that offers a handful of financial products, including its e-savings account. Accessible via desktop or the Alterna Bank mobile app, the e-savings account offers a hefty interest rate of 0.90%. Plus, you can save even more thanks to the no-fee structure and unlimited free debits, transfers, and bill payments.
- Earn 0.90% interest
- No monthly fees
- Free, unlimited transfers, debits, and bill payments
- Free, unlimited Interac e-transfers
- No minimum balance
- Deposits are insured through the CDIC
- Mobile app
Why Would A Consumer Need An Online-Only Savings Account?
While a checking account is designed for daily money transactions, a savings account is not meant to be used for everyday use. Instead, it’s meant to serve as a vehicle to save money. The longer the money remains in the account, the more interest will accrue over time. Savings accounts typically have higher interest rates than checking accounts, which is why it’s better to leave a larger chunk of your money in savings rather than in your checking account.
Savings accounts are not only offered by big banks but online-only banks too. You can deposit, make transfers, and keep tabs on your account all virtually via your computer or mobile app. Customer service is available through chat, phone, or email if you have any questions or concerns.
Online-only savings accounts are also attractive to digitally-savvy consumers because they tend to come with no fees, unlike big banks that tend to charge a monthly fee or require minimum account balances. Not only can banking be much more convenient with an online-only savings account, but they can be money-savers thanks to their no-fee structures.
How Do I Choose An Online-Only Savings Account That Suits Me?
When selecting an online-only savings account, certain factors should be considered, including the following:
Interest Rate
Savings accounts were meant to help you save money, so the higher the interest rate, the faster your money will grow.
Monthly Fees
Nobody likes to see a monthly fee be tacked onto their accounts, so verify if there are monthly fees for the online-only savings accounts you’re considering.
Minimum Balance
Like the monthly fees, you don’t want to be charged a fee if you go below a certain minimum balance threshold, so look for accounts that have a low or no minimum balance requirement.
Are Online Savings Accounts Safe?
Banking with an online-only institution outside of the traditional, big bank realm may seem a bit unconventional for some consumers. Some may even be a little wary of dealing with them. More specifically, some consumers may wonder if the funds deposited with an online-only bank are safe.
In fact, banking online is very safe. Reputable online banks not only insure deposits but also use encryption to make sure your personal information is safe. Nonetheless, it’s always advisable to use a strong password that would be hard for hackers to crack.
Final Thoughts
Unless you plan to invest your money, leaving it in a savings account that pays out a high-interest rate is your best bet. But instead of taking the traditional banking route, you may want to consider an online-only savings account to take advantage of low fees and the unmatched convenience of banking online. And if you’re looking for the right online-only savings account to park your capital, we think the above accounts should make your shortlist.
Neo Money is provided by Concentra Bank.
® Trademark of Interac Inc. Used under license.
*Interest is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.
2 The Neo MoneyTM account is provided by Concentra Bank, a CDIC member institution, and is eligible for CDIC deposit protection. Deposits held in Neo MoneyTM accounts are combined with eligible deposits held at Concentra Bank, for up to $100,000 of deposit protection, per category, per depositor. For more information about CDIC deposit insurance, please consult CDIC’s website cdic.ca.
3 Limited-time offer. Only new Neo Money™ customers are eligible for this offer. This offer is only awarded if a new customer opens a Neo Money™ Account and deposits a minimum of $50 within the next 90 days. Offer is subject to the Rewards Policy, the Neo Platform Terms and Conditions and all other applicable terms and conditions. Offer may be amended or cancelled at any time without notice.
