Chequing Accounts in Canada: What They Are and How They Work

What it is

A chequing account is your everyday money account — the one your paycheque lands in and your bills come out of. It is designed for money that moves: deposits in, payments out, as often as you like. (If you arrived from India or the UK, this is what you know as a current account — same idea, Canadian name.)

How it works

1. You open the account at a bank or credit union, in a branch or online.
2. Money goes in via direct deposit (your employer), Interac e-Transfer, cash or cheque deposit.
3. Money goes out with your debit card, online bill payments, pre-authorized debits (rent, phone bill), or e-Transfers to other people.
4. Some plans limit transactions. Basic accounts may include 12–25 free transactions a month; unlimited plans cost more per month. Every debit purchase, bill payment, and e-Transfer can count as one transaction.

What it’s used for

For: receiving income, paying bills and rent, daily spending with a debit card, and holding the cash you need in the next few weeks.

NOT for: growing your money. Chequing accounts pay little or no interest. Money you won’t need for months belongs in a high-interest savings account or GIC, not sitting in chequing.

Who provides it in Canada

• Big Five banks: RBC, TD, Scotiabank, BMO, CIBC — large branch and ATM networks, newcomer programs.
• National Bank and Desjardins — strong in Quebec and Eastern Canada.
• Digital banks: Tangerine (Scotiabank), Simplii (CIBC), EQ Bank — no-fee chequing with no branches.
• Credit unions (e.g. Meridian, Coast Capital, Alterna) — member-owned, competitive fees.

What it costs

• Big Five unlimited plans: typically around $16.95/month (TD’s Unlimited account is $17.95), usually waived if you keep a minimum daily balance — commonly $4,000. National Bank’s Connected account is $15.95 with a $4,500 waiver threshold.
• Digital banks: Tangerine, Simplii, and EQ Bank charge $0 in monthly fees with unlimited transactions.
• Newcomer programs: the Big Five typically waive monthly fees for around 12 months for newcomers (National Bank offers up to 3 years in some cases). Check each bank’s current newcomer page — offers change.
• Watch for extras: overdraft fees if your balance goes below zero, and non-sufficient funds (NSF) fees on bounced payments.

Newcomer notes

• You do not need Canadian credit history to open a chequing account.
• You’ll need ID (passport, PR card, or work/study permit) and usually your SIN — partly so the bank can report any interest to the CRA.
• Many banks let you start the application before you arrive and activate in a branch after landing.
• Terminology trap: asking for a “current account” may confuse a Canadian teller. Say chequing (pronounced “checking”).

Risks / watch-outs

• Fee drag: $16.95/month is over $200 a year for the privilege of accessing your own money. If you won’t keep a $4,000 balance, a no-fee digital account is usually the better deal.
• Overdraft: spending more than your balance triggers steep fees. Decline overdraft protection if you’d rather have a transaction refused than pay for it.
• No growth: money parked in chequing earns essentially nothing. Keep only what you need for the month.

FAQ

Do I need a SIN to open a chequing account? Not always to open it, but banks will ask for one — interest earned (even tiny amounts) must be reported to the CRA, and the SIN is how that’s tracked. Get your SIN first anyway; you need it to work.

Can I open an account before I arrive in Canada? Several Big Five banks let newcomers begin the application online from abroad (notably Scotiabank’s StartRight program) and finish it in a branch after landing. Digital banks generally require a Canadian address.

Chequing vs savings account — do I need both? Yes, ideally. Chequing handles daily money; a high-interest savings account holds your emergency fund and short-term savings where it actually earns something.

What happens if my balance goes negative? The transaction may be declined, or — if you have overdraft protection — approved with a fee plus interest on the negative amount. Either way, fix it the same day.

How many chequing accounts should I have? One main account is enough to start. Many Canadians later add a no-fee digital account for daily spending while keeping a Big Five account for branch access and credit products.

Do people still use paper cheques in Canada? Rarely, but they haven’t vanished — some landlords still ask for a void cheque to set up pre-authorized rent payments, and you can deposit a cheque by photographing it in your banking app. Your bank provides a small book of cheques on request, sometimes free with newcomer packages.

Educational content only — not financial advice. Rules and promotions change; verify current details with the provider or CRA.