By Remitbee - Oct 16, 2020
Whether you are new to Canada or you’ve been here for a while, it’s important to have a Canadian bank account to easily manage your finances while you are living in the country. You can do this even if you don’t have a job, don’t have funds to deposit in the account yet or have declared bankruptcy in the past. They’re pretty easy to open, although you will have to visit a branch in-person to do so.
To start, you need to choose the bank where you want to create an account. There are certain banks that are more widely available in different regions, and each bank will have slightly different perks associated with having an account. You’ll also have to decide between a bank or a credit union. Several features to consider in addition to the location are interest rates for credit cards, service charges associated with different banking features, and the types of accounts and services offered.
Some of the most popular banks are Bank of Montreal (BMO), Hongkong and Shanghai Banking Corporation (HSBC), Canadian Imperial Bank of Commerce (CIBC), Scotiabank, Education Credit Union (for students), Royal Bank of Canada (RBC), Toronto-Dominion (TD) Canada Trust and Libro Financial Group. Once you have made your selection, you can begin the process of obtaining an account.
Gather two pieces of identification to take with you to your bank. These include a study permit if you are an international student, your passport, a letter of acceptance if you are a student, Travelers’ cheques, Certificate of Indian Status, Certificate of Canadian Citizenship, Permanent Resident Card, and provincial or territorial health insurance card among other documents. Certain branches and credit unions also require a home address nearby to proceed.
Once you are at your appointment, you’ll have to decide what types of accounts you want to open. For instance, you can open a Foreign Currency Account where you keep some money in a different currency and some in CAD. Savings accounts are helpful if you plan on keeping your money in the bank for a longer period of time since it earns more interest in this type of account over time than a chequing account. Finally, the most common account type, chequing accounts. You will almost certainly want a standard chequing account since these are used to withdraw and deposit money regularly, pay credit card bills, and more. They don’t earn much interest if any, but they are the most useful for daily banking needs.
That should be all you need to open a banking account! The bank representative should give you your debit card along with a PIN that you can use to make transactions or withdraw money at the ATM. Once you have an account, you should be able to complete most of your banking online or through an app, which is especially useful during the COVID19 pandemic as it reduces your contact with people at the bank.
Due to covid, some banks offer an option to open a bank account online. But for verification purpose they would like to see you in person.
Once you have a standard chequing or savings account, you may want to consider applying for a credit card. Canadian banks tend to offer Visa, American Express, or MasterCard, which are accepted at most businesses. Make sure you read the terms and conditions thoroughly before choosing which Credit Card you apply for. You should also consider how you will use the card. For instance, if you intend to use it to make work purchases or other larger purchases where you are reimbursed that month and are able to pay off the balance quickly, you may benefit from selecting a card with a high-interest rate but better cash reward policy. If you think you may carry a balance for longer, however, opt for a lower-interest-rate card so you don’t have to pay more in the long run than you need to.
You can also consider applying for a bank loan or a line of credit. If you want to do this to make a larger purchase, you will likely need to give the bank some sort of collateral to guarantee the loan. Don’t consider a loan if you aren’t sure you can make the payments or if you can obtain what you need to in another form without taking a loan.