I am a newcomer. I have started account with one of the big 5 banks and ended up in paying monthly fees. I will share my experience.
Big 5 banks (TD, RBC, BMO, Scotia, CIBC) :-
Pros and cons
- Pay monthly fees ($4 to $30, depends upon the accounts/ or you need to keep minimum balance in checking/account to wave off those fees)
- Special fees for credit card yearly. (credit card not easy to get for new comers)
- Many accounts with less monthly fees have only limited translations (like 12 to 24 per month including all transactions)
- No or very less interest paid in most accounts.
- If you need cheque book, you need to pay another $45 to $85 to get that, also you need to personally request to your home branch.
- For any major changes, you need to personally meet your home branch (only after taking prior appointment on a specific date, you may need to call and fix an appointment (may take 15 to 45 mins to fix an appointment).
- You can wire transfer to anywhere outside canada.
- Very easy to start an account once you take an appointment.
Tangerine bank
Pros and cons
- No fees for any accounts, credit card or debit card.
- 3.5% interest paid for savings account, good interest paid for checking accounts compared with all the Big 5 banks.
- Fully on line operational, you may add/edit/delete accounts, anything as you like.
- For address verification you can go to any nearby canada post-office and show your ID with tangerine DSS number. (dont need to travel to bank/kiosk)
- Same as secure as Big 5 Banks.
- You will get debit card through post within few days. Very easy to get credit card and build credit history.
- You can use all ATM/ABM of scotia bank.
- You can deposit any cheque by simply taking photo of both sides through tangerine app (no need to go to bank/kiosk)
- You cannot wire transfer outside canada but can be transfered to any other banks in canada.
- For account - you need to signup and show ID to nearby postoffice.
- Use account statement as a proof of address.
While signup for Tangerine accounts you can enter any of your friends reference number (known as orangekey) to get additional $50 free. This is an offer just like Uber app. If you dont have an orange key from any friends, you can use this (orange Key 55209416S1 ). Personally I am very happy with tangerine bank. I got debit card in 2 days though canadapost, after verification. You can visit tangerine webpage and read more details.
I recommend all new comers to start an account, since you may close your account with the Big 5 banks soon or later. I have requested my HR department to credit my salary to tangerine account
There several statements that are not exact there
Traditional banks:
- most of them have programs for newcomers, where you can avoid most fees completely for first 6 to 12 months.
- most of them have additional option how to keep that status as long as you meet certain conditions (for example to have minimum balance or income per month).
- cost of the credit cards does not only depend on your bank but also on type of the credit card (some are free of yearly cost, like what I have) and of course your credit score. So you will face the same problem with online only banks.
- surprisingly big five does use online banking as well, so most of the changes or checkups, you can do online the same way. (pay your bills, apply for a credit card, do most changes).
Tangerine:
- you might be requested to transfer first opening funds using your existing bank account (this is the biggest limitation for newcomers, who do not have Canadian bank account or Canadian check book).
- you might have to prove your current Canadian address with something like hydro for example (that again is difficult for somebody who just came to Canada).
- getting credit cards is not really easier than in one of big 5 (Tangerine will do same credit checks on you that any other bank did and some cards might not be in your range if credit score is missing).