Finance

Banking

In Canada, you have the right to a personal bank account, even if:

• You do not have a job;
• You do not have money to put in the account right away;
• You have poor credit rating; or 
• You have been bankrupt.

To open a bank account, you must go to the bank in person and present acceptable identification pieces. The documents you present must be original (not photocopies) and in good condition. Identification that has expired is not valid. There are different combinations of identification you can use to open a bank account.

Requirements to open an personal account:

• At least two forms of government-issued photo identification, such as a valid driver’s license or passport.
• Social security number or individual taxpayer identification number.
• Utility bill with current address information.
• Full contact information of the applicant, such as name, address, and phone number.
• Student checking accounts may require proof of enrollment in an eligible school such as a student ID or acceptance letter.
• If the bank has a minimum deposit requirement, you may need to provide the deposit at the time of applying

Remember: Unless the personal bank account you are opening pays interest, you do not need to provide your SIN to the bank.

For newcomers, you do not have to have a permanent address to open a bank account. However, if you do provide an address, the bank may ask you for proof that you live there. An example of such proof would be a recent utility bill that includes both your name and address.

Main types of bank accounts

Chequing accounts 

Chequing accounts allow you to write cheques and usually include the use of a debit card. They often have lower transaction fees than a savings account and may or may not have a fixed monthly fee. You will need a chequing account if your employer uses payroll deposit. Payroll deposit allows your employer to deposit money directly into your chequing account.

For day-to-day banking needs, chequing accounts are the most common among Canadians.

Savings Account

Savings accounts are helpful if you want to save money because they provide higher interest than chequing accounts. You may be allowed to make only certain types of transactions or a certain number of transactions. Additional transactions may be expensive. Tax-free Savings Account (TFSA) is for 18 and older individuals to set money aside tax-free throughout lifetime.

Cheque Holding

Your bank may apply a “hold” (a waiting period) on money you deposit by cheque. If you need to access your money sooner, you can speak with your bank to see if the waiting period can be shortened. 

However, If the cheque is from a bank or other financial institution located outside of Canada, the cheque can take much longer to clear. Foreign cheques are often held for 30 days.