How to Open A Bank Account

In Canada, there are many different options available when considering opening up a bank account. Bank accounts are available at all Canadian banks, trust companies and credit unions and they offer individuals a safe and reliable place to keep their money.

Accounts can be opened as either chequing or savings accounts, depending on the needs of the account holder and everyone has the right to open one of these accounts, provided they can show proper identification, even if they don’t have money, don’t have a job or have filed for bankruptcy in the past.

Quick Links

1. What Documents Are Needed To Open a Bank Account
2. How Do I Open a Bank Account?
3. Which Account is Right For Me?
4. Frequently Asked Questions About How to Open A Bank Account

What Documents Are Needed to Open a Bank Account?

In order to be eligible to open a bank account within Canada there are certain documents must be provided in order to prove your identity. Most financial institutions will require at least two pieces of identification and these must be originals and not duplicates or photocopies.

Some of the most commonly requested ID’s include:

• A valid Canadian driver’s license
• A current Canadian passport
• A Canadian birth certificate
• A Canadian Social Insurance Number card
• A Canadian Old Age Security card
• A Certificate of Canadian Citizenship or Certification of Naturalization

• A valid provincial health insurance card
• A Permanent Resident card
• A Canadian Certificate of Indian Status
• A current foreign passport
• A valid Canadian debit or credit card with your name and signature on it
• An Immigration, Refugees and Citizenship Canada form 

How do I Open a Bank Account?

Opening a bank account in Canada is an easy process. Once you have chosen the institution that is right for you and have determined which particular account will best meet your needs, a quick visit to the bank is usually all that is required. Once the appropriate ID has been provided, the bank will have you sign the essential legal documents, answer any questions that you have about your new account and provide you with all of the information that you need on depositing and withdrawing money.

Some banks may allow you to set up your account online, without having to make a visit to the bank in person, however they may require proof that you already have an account with a different bank or institution.

If you have any questions about how to open up an account at your chosen financial institution and what their individual requirements are, a quick phone call to their branch should clarify everything.

Which Account is Right For Me?

There are many things to consider when deciding which account is right for your individual banking needs. Different banks and different types of accounts may offer certain advantages and disadvantages depending on your specific requirements.

Some important things to take into consideration include:

Interest Rate

If you are looking to open up a savings account then you will want to investigate the interest rates available at different institutions. The higher the interest rate, the more money you will earn back on your investment.

Service Charges

Many banks will charge annual fees for their accounts or may have a service charge for extra cheques to be printed or for an additional debit card. Always be sure that you understand the fees associated with opening your account.

Transaction Fees

Different bank accounts may have certain transaction fees associated with them. Some institutions may only allow a certain number of free online and ATM transactions and you may pay extra for foreign transactions or overdraft charges. Researching the fees that are associated with the different accounts available will help you make a more educated decision and could save you a significant amount of money in the future.

Hours of Operation

Always be sure to check the hours of operation at your chosen institution. Different banks have different hours and some may fit your schedule better than others. Also, if you choose to deal with an online only establishment, ensure that you are aware of the best method to contact them and that someone will be available for either online chat or voice call when you may require assistance.

Minimum Balances

Many banks will allow you to open a basic chequing or savings account with no initial deposit or minimum balance, while others require that a minimum amount of money be kept in the account at all times. Often if the balance fails below this minimum, a penalty fee will be charged.

Deposit Insurance

Reputable financial institutions are covered by the Canada Deposit Insurance Corporation (CDIC), which protects all eligible deposits, up to $100,000, in the event that something happens to your bank or credit union. If you choose to do business with a smaller, less known institution, it will pay to do your due diligence and ensure that their deposit insurance is up-to-date.

Frequently Asked Questions About How to Open a Bank Account

What is the difference between a savings and a chequing account?

While both accounts are very similar, a savings account is specially designed to help you save money for your future. There is usually a higher interest rate on a savings account meaning that the money you invest there will grow faster. While you can still access this money to make purchases and pay bills, there are usually higher fees associated with these transactions. This is where a chequing account comes in handy. A chequing account usually has a very low rate of interest (if any) however the transaction fees are usually low as well. This is the perfect account to use for making paycheque deposits, paying monthly expenses and withdrawing cash.

Can I open an account if I am not a Canadian citizen?

Opening a bank account in Canada, if you are not a Canadian citizen is a possibility if you can provide all of the necessary documentation. Most banks will require multiple sources of identification, however each financial institution may have their own specifications. It is recommended that you contact your chosen bank beforehand and speak to a representative to ensure you will be able to provide all of the information that they will need.

Why does the bank need my Social Insurance Number?

A bank will require your Social Insurance Number (SIN) if you are opening any type of bank account that will earn interest. This is required by the Income Tax Act as any interest earned must be reported, by law, to the Canadian government.

Can I be refused a bank account?

If a financial institution has reason to believe that you plan on using your bank account for illegal purposes, if you cannot provide all of the required identification, if you have a history of fraudulent transactions or if they have reason to believe that you may harass or cause harm to the institution, its patrons or its staff members, they have the right to deny you an account.