Online banks have lots of perks. 

Most notably, online banks have less overhead fees because they often don’t have physical locations to serve customers. There are no tellers or branches so everything is done online. For a socially anxious millennial like me who freezes up when talking to strangers– this model is perfect for me. I don’t want to line up at a bank to take out money or manage my affairs so online banking is the right choice for me. 

Since the bank operates digitally, there is 24/7 access. You just log into your account and do what you need. Online banking can make it faster to pay bills, automate your accounts, and get your finances in order. 

In Canada, some of the most popular online banks are Tangerine, EQ Bank, and Simplii. While these banks have been around for a while, many people still wonder if they are safe. 

Personally, I’ve never experienced any security issues but there have been some technical delays. For a short period, my Tangerine app wasn’t letting me log in using my fingerprint. I realized the app was outdated so I had to uninstall it and add it back. 

In terms of security, online banks have the same insurance as the big banks. (In fact, some online banks are subsidiaries of the Big 5 Banks.) This insurance is called the Canada Deposit Insurance Corporation.   

The Canada Deposit Insurance Corporation (CDIC) has been protecting Canadians’ deposits for over 50 years. CDIC protects over $800 billion in deposits and coverage is $100,000 for each insured deposit category, per member institution.

Essentially, your money at a reputable online bank is protected by insurance (look for the CDIC logo on the bank’s website). If something went wrong, the CDIC would step in. Here’s what their website explains: “If a bank does fail, CDIC has tools to resolve them while protecting depositors and contributing to the stability of the financial system. Since the CDIC was created by Parliament in 1967, CDIC has handled 43 failures, affecting more than 2 million depositors. No one has lost a single dollar that is under CDIC protection. “

Does that give you some piece of mind?

registered Online banks in Canada are safe.

Here are some of the most popular online institutions and their pros and cons. 

Tangerine Bank

Tangerine Bank has been around for a while. Tangerine was launched as ING DIRECT Canada on April 27, 1997 so they have some years of history to back them up.  In 2012, Scotiabank acquired ING Direct and Tangerine has quickly become a Canadian favourite.  

Since they don’t have expensive brick-and-mortar branches, you don’t pay unfair fees- and that’s just one of the benefits. 

Pros and cons of Tangerine Bank:

Pros: 

• Tangerine has proven security technology, strict privacy standards, identity confirmation controls and 24/7/365 real-time monitoring on transactions.
• Great interest rates (often more than 2%) and no unfair fees (I’ve never paid for online banking with them)
• Free Interac e-Transfer®
• Free access to 3,500 ABMs
• Offers Savings Accounts, Chequings Accounts, Credit Cards, GICs, Business Savings Accounts, and Investment Funds 
• You can set up multiple sinking funds to keep track of your savings goals easier

Cons: 

• Limited in-person customer service since everything is done online
• Bank drafts may take a few days to arrive (so if you are making large purchases, plan ahead)
• Investment products are limited
• Difficult to withdraw large sums of cash 

Open a Tangerine account today.

EQ Bank

EQ Bank (Equitable Bank) stands apart because of their Great Rates, Guaranteed! There are no everyday banking fees, no minimum balances, and unlimited transactions. The Savings Plus Account has one of the most competitive interest rates on the market which helps make it easier to save!

Let’s dive into the pros and cons of EQ Bank.