Canada’s biggest five banks have all raised their fees, or plan to do so in the next few months. Depending on their bank, customers could face higher monthly account fees, have to pay extra money for debit transactions, ATM use and other services, and require a higher minimum balance to have some of those fees waived.
Although in most cases, it’s just a dollar here or there, those additional fees can add up quickly, said Gary Tymoschuk, vice-president of operations for the Credit Counselling Society. He said that he has seen clients with fees ranging from $12 to nearly $40 per month.
“If you’re paying for a package, be mindful of how many transactions that actually includes,” said Tymoschuk. “Many plans do include a maximum: 10, 15, 20 or whatever it is and after that you’re starting into the per-transaction charges.”
“Know what your parameters are and if you’re bound by certain restrictions, like withdrawals and so on, and live within those restrictions – or find an alternative.”
There are alternatives for your ordinary banking needs that charge low or no fees. If you’re thinking about switching, said Tymoschuk, you should start by determining your own banking needs.
“I think you need to start by assessing your lifestyle. How many times do you need to get cash from the bank machine?” he said. Knowing how many debit card and other transactions you make in a month would also be helpful.
Then, with those parameters in mind, you need to do research to assess if different banking packages will work for you, he said. Keep in mind the credibility of the organization, how long it’s been in business, and whether they offer any bonuses like if they pay interest on the account or have points programs, he said.
Here are some of the more popular low- or no-fee banking options in Canada:
This bank, affiliated with the Loblaw grocery store chain, offers a no-fee chequing account. According to their website, their No Fee Bank Account doesn’t charge a monthly fee, offers free debit transactions, and is paired with a points program valid at Loblaws grocery stores. What they don’t offer are actual bank branches or human tellers – so if this is something you use, you should look elsewhere. And although you can withdraw money for free at PC Financial and CIBC bank machines, they still charge if you use other kinds of ATMs.
Similar to the PC Financial account, Tangerine’s chequing account won’t charge you a monthly fee or for debit purchases. Also like PC Financial, they encourage you to do your banking online, though they do have “Cafes” instead of branches where you can meet staff in person. However, as there are only five of them across Canada, they’re hardly convenient for many people. Tangerine also allows you to withdraw money for free using Scotiabank ATMs.
Unlike PC Financial and Tangerine, credit unions do often charge monthly fees or fees for basic banking services like debit purchases and ATM withdrawals. However, these vary considerably between credit unions. For example, Vancity credit union waives monthly fees on its chequing accounts, as well as fees for debit transactions and other basic banking functions if you maintain a minimum balance of $1,000. Meridian offers a variety of service packages all at different monthly fees.
Credit unions also maintain branches, so you can discuss your accounts in person if you wish. Some of Canada’s biggest credit unions are Vancity, Servus, Coast Capital Savings, Meridian and Conexus, though you should investigate what’s available in your area.