If you’re looking for a Canadian bank that offers a good interest rate, then you need to check out EQ Bank who’s one of the most popular digital banks in Canada Right now, their interest rate is a respectable 1.70% interest* rate on their EQ Bank Savings Plus Account and easily makes it one of the best high interest savings accounts in Canada. Admittedly, that’s not the highest rate available out there, but EQ Bank has been consistent with their rates ever since they came to the market.
With EQ Bank, there’s no need to chase promotions or to constantly transfer your money with different accounts. You always get a great interest rate.
The safety of your money is always important, but so is the customer service experience. EQ Bank is focused on providing a better banking solution that will help Canadians reach their savings goals faster. Here’s my EQ bank review of their Savings Plus Account.
EQ Bank Savings Plus Account Features
- 1.70%* everyday interest rate
- No everyday banking fees
- Unlimited day-to-day transactions
- No minimum balance required
- Unlimited free Interac e-transfers®
- Free electronic fund transfers
- Savings goals features
- Mobile App
- Member of the Canadian Deposit Insurance Corporation (CDIC)
One of the biggest complaints from Canadians is the lack of a reasonable interest rate with savings accounts. Since EQ Bank’s rate of 1.70%* is available to everyone and not just a teaser rate, it makes the account very attractive. The high-interest rate is obviously an attention grabber, but the other benefits of the account are quite good too.
Although EQ Bank has been around a few years, some potential clients tend to be suspicious of the high rates being offered. The good thing is, EQ Bank is owned by Equitable Bank who’s a Member of the Canadian Deposit Insurance Corporation so your accounts are protected up to $100,000.
No monthly fees, unlimited day-to-day transactions, and no minimum balances are pretty common in the online world, but for whatever reason have been slow to adapt by the big 5 banks. To be fair, bricks and mortar banks have much higher operational costs since they have retail locations and staff to pay. EQ Bank is branchless and completely digital so the savings are passed on directly to their clients.
Accessing your money is pretty straight forward since you would link your EQ Bank account to your regular bank account, but it does take up to two business days to transfer any funds. If you want to speed up the process you can get access to your money within 30 to 60 minutes by using your unlimited free Interac e-Transfers®. Currently, there’s no debit card available, nor can you set up your account inside your TFSA or RRSP which is disappointing.
All these features should have both savers and investors excited. You can simply park your money and get a guaranteed return (minus taxes of course) with zero risks. With EQ Bank, your interest is paid monthly and there’s no holding period.
Despite all of these great features, EQ Bank is not available to residents of Quebec.
Why use EQ Bank?
Many people are hesitant to switch banks (we all know they don’t make it easy), but EQ Bank shouldn’t be viewed as a replacement, it’s meant to complement your daily banking needs.
It doesn’t matter if you’re saving for a vacation, school, or a new pair of boots, the EQ Bank Savings Plus Account allows you to open an unlimited amount of sub-accounts to meet your needs. The added option of setting savings goals for each individual account is a bonus since you can clearly monitor the progress of your savings. Best of all, your money is never locked in with the EQ Bank Savings Plus Account. You can withdraw your money whenever you need to.
Saving is obviously the theme of the account, but you can also do day-to-day transactions directly from the mobile app including transferring funds and making bill payments. EQ Bank does not allow your account to go into overdraft so you won’t need to worry about being charged extra fees; it’s the lack of available money that I’d be concerned about.
There’s no catch. Even though EQ Bank gives you an above-average interest rate, they make their money by lending out your deposits to other people at a higher interest rate. This is standard practice for any bank, but since EQ Bank is a digital bank, they have less overhead compared to traditional banks.
Some people don’t like the fact that EQ Bank doesn’t offer a debit card, but I think this is a good thing since you can’t withdraw your money at a machine whatever you want. One thing EQ Bank does allow is pre-authorized payments. This means you can do all of your daily spending with one of the best travel credit cards in Canada or one of the best cash back credit cards in Canada and then set your card to be automatically paid from your EQ Bank account. By doing this, your money is only withdrawn once a month from your EQ Bank account so you’re basically earning the maximum interest and getting credit card rewards at the same time.
EQ Bank joint accounts
It may have taken a few years but EQ Bank finally has joint accounts which is obviously handy for people who want set up an account with someone else. Best of all, EQ Bank joint accounts allow up to 3 people which is perfect for a variety of reasons such as elderly parents who want their adult children to have easy access to their funds.
The same interest rate applies to joint accounts. It’s also worth mentioning that CDIC considers joint accounts separate from your main account, so you get another $100,000 insured by them.
Is EQ Bank safe?
I already covered this above, but I want to go over it again. EQ Bank is safe and it’s unlikely to go out of business. The reason you can trust EQ Bank is that they’re owned by Equitable Bank. In case you didn’t know, Equitable Bank has been in operation since 1970 and is a member of the Canadian Deposit Insurance Corporation (CDIC).
Any person who has their money deposited at a CDIC member will have their accounts protected up to $100,000. If you need more deposit insurance, you could have your spouse open an account which would give you another $100,000 in protection.
To be clear, it’s still possible for a bank to fail, but this applies to all banks. Just because EQ Bank is giving its customers a higher interest rate, that doesn’t mean they’re riskier. I personally use EQ Bank to park the majority of my cash savings.
EQ Bank refer a friend
Just recently, EQ Bank introduced a referral program where the person signing up gets $20. If you’re the one making the referral, you also get $20, but that amount increases depending on how many people you bring aboard.
- $20 – For your first 3 referrals
- $30 – For your next 4 referrals
- $40 – For any additional referral
The referral bonus is capped at $500, so that means you’ll reach the maximum after 15 referrals. Remember, you only get the referral if the person who is signing up for an EQ Bank Savings Plus Account deposits at least $100 into their account within 30 calendar days of account activation.
EQ Bank GIC
EQ Bank’s other major product available is guaranteed investment certificates (GICs). GICs are a type of investment that guarantees you a return. The “catch” is that you need to lock in your money for the time you specify. The longer you lock in your money, the higher the interest rate you get. Investing in a GIC can be beneficial if you know you won’t need that money for a set period of time. As rates are always changing, I won’t list what’s available now, but the terms are as follows:
- 3 Months
- 6 Months
- 9 Months
- 1 Year
- 15 Months
- 2 Years
- 27 Months
- 3 Years
- 4 Years
- 5 Years
For you to purchase a EQ Bank GIC, you must have an EQ Bank Savings Plus Account.
How does EQ Bank compare to others?
To be realistic, all digital banks are similar, but I do like to separate them into tiers.
Motive Financial is their closest competition when it comes to interest rates, but they’re pretty similar. LBC Digital is another bank that came in with aggressive rates when they launched, but their rates are a bit lower now.
Then there are banks such as Tangerine and Simplii which are owned by bigger banks (Scotiabank and CIBC respectively) who give you access to an ATM network, but their interest rates are much lower.
I personally use EQ Bank for all my personal banking, but I also use Tangerine because my wife and I have old accounts there. I’ve linked my EQ Bank account to my Tangerine account so I can easily transfer money between the two. You don’t need to use one online bank, just pick the ones that make the most sense for you.
Overall my EQ Bank review is positive. Despite the fact that currently there’s no debit card, TFSA or RRSP account available, the 1.70%* interest rate is higher than average daily rates and the additional features make it an attractive account. It’s clear that EQ Bank respects their clients’ money and values their business.