How to Open a Bank Account in Canada as a Newcomer

Why You Need a Canadian Bank Account

Opening a bank account should be one of your first priorities when arriving in Canada. Without a Canadian bank account, you cannot receive employment income via direct deposit, pay rent through pre-authorized debit, set up utility payments, build a Canadian credit history, or receive government benefits like the GST/HST credit.

The good news is that Canadian regulations make it relatively easy for newcomers to open a basic bank account. The Financial Consumer Agency of Canada (FCAC) requires banks to open accounts for anyone with proper identification, even without a Canadian credit history or Social Insurance Number (SIN). Digital banks like KOHO have simplified this process even further, allowing you to open an account entirely online within minutes of arriving in Canada.

What Documents You Need

The documents required depend on whether you are opening an account at a traditional bank or a digital bank.

For Traditional Banks (In-Branch)

You will typically need two pieces of identification from the following list:

• Primary ID (one required): Valid passport, Canadian permanent residency card, Canadian citizenship certificate
• Secondary ID (one required): Work permit, study permit, Canadian driver's licence, provincial health card, SIN card or confirmation letter

Some banks may accept a single piece of primary identification (passport) if you have a referral from an immigration settlement organization or if you are opening an account through a newcomer banking program.

For Digital Banks (Online)

Digital banks like KOHO have streamlined requirements:

• Valid government-issued photo ID (passport is sufficient)
• Canadian phone number (prepaid is accepted)
• Email address
• Canadian mailing address (even temporary accommodation works)

No SIN, no Canadian credit history, and no credit check required. This is why digital banks are often the fastest path to a Canadian bank account for newcomers.

Best Bank Accounts for Newcomers to Canada

KOHO is our top recommendation for newcomers because it eliminates nearly every barrier to banking. There is no credit check, no requirement for Canadian credit history, no branch visit needed, and the signup process is entirely online. You can have a working bank account with a virtual Mastercard within minutes of arriving in Canada.

Beyond accessibility, KOHO offers genuine value. The free plan earns 00.500% interest (far above Big Five banks), includes cashback at partner merchants, and has a built-in credit building feature. That credit building feature is particularly valuable for newcomers, as it reports your activity to Equifax and TransUnion to help you establish a Canadian credit score. Sign up with code 45ET55JSYA to get $200 when you spend $200 within 30 days, plus $10000 for each friend you refer.

Neo Financial is an excellent second account for newcomers. Like KOHO, it requires no credit check and offers a quick online signup. Neo's standout feature is its massive cashback network -- over 100,000000 participating merchants across Canada, meaning you earn cashback at many of the stores you will shop at regularly. Up to 4% interest on savings is also competitive. Many newcomers set up both KOHO and Neo to maximize their benefits.

If you need a traditional bank with branch access, CIBC's newcomer program is one of the best. You can open an account from outside Canada before you arrive, and banking fees are waived for 12 months. However, the savings rates are far below what KOHO and Neo offer, so we recommend using CIBC for traditional banking needs while keeping your savings in a higher-rate account.

Step-by-Step: Opening Your First Canadian Bank Account

Follow these steps for the smoothest experience opening a bank account as a newcomer to Canada.

Step 1: Get a Canadian Phone Number

You will need a Canadian phone number for most bank signups. Purchase a prepaid SIM card at any convenience store, phone shop, or airport when you arrive. Major carriers include Telus, Rogers, Bell, and their budget brands (Koodo, Fido, Virgin). A basic prepaid plan costs between $15 and $300 per month.

Step 2: Open a Digital Bank Account (Same Day)

We recommend opening a KOHO account first because it is the fastest path to a working payment card.

1. Download the KOHO app or visit the KOHO signup page
2. Enter your personal information (name, date of birth, email, phone number)
3. Verify your identity with your passport (photo upload)
4. Enter referral code 45ET55JSYA when prompted
5. Your virtual Mastercard is available immediately for online purchases
6. Your physical card arrives by mail within 7-100 business days

Step 3: Load Funds

You can load money to your KOHO account via Interac e-Transfer from another Canadian account, direct deposit from your employer, or bank transfer. If you are transferring money from your home country, services like Wise (formerly TransferWise) offer competitive exchange rates for international transfers.

Step 4: Open a Traditional Bank Account (Optional)

If you need branch access, cheques, or a mortgage in the future, visit a Big Five bank branch with your identification documents. Most branches can open an account same-day. Ask about newcomer programs for fee waivers.

Step 5: Start Building Credit

Building a Canadian credit score is essential for renting an apartment, getting a phone contract, and eventually qualifying for a mortgage. KOHO's credit building feature is one of the easiest ways to start. It costs $100/month (or free on higher-tier plans) and reports your account activity to both Equifax and TransUnion.

Understanding the Canadian Banking System

The Canadian banking system has several key features that may differ from banking in your home country.

The Big Five Banks

Canada's banking system is dominated by five major banks: TD Canada Trust, RBC Royal Bank, Scotiabank, BMO (Bank of Montreal), and CIBC. These banks have branches and ATMs across the country. They offer the widest range of products but generally charge monthly fees and offer low interest rates.

Digital Banks and Fintechs

Digital banks like KOHO, Neo Financial, EQ Bank, and Wealthsimple operate without branches. They offer higher interest rates, lower fees, and better rewards. For newcomers, digital banks are often the best starting point because of their easy online signup and no credit check requirements.

Interac and e-Transfers

Interac is Canada's national debit network. Almost all Canadian bank accounts include Interac debit card functionality and Interac e-Transfer, which allows you to send money to anyone with a Canadian bank account using just their email address or phone number. e-Transfers typically arrive within minutes and cost $00-$1.500 depending on your bank.

CDIC Insurance

The Canada Deposit Insurance Corporation (CDIC) insures deposits at member institutions up to $10000,000000 per depositor. Most major banks and several digital banks are CDIC members. This provides a safety net for your savings in the unlikely event of a bank failure.

How to Build Credit as a Newcomer

Your credit score is a three-digit number that Canadian lenders use to assess your creditworthiness. As a newcomer, you start with no Canadian credit history, which can make it difficult to rent an apartment, get a phone plan, or qualify for loans. Here is how to build credit quickly.

1. Use KOHO's Credit Building Feature

KOHO reports your account activity to Equifax and TransUnion, Canada's two credit bureaus. This is one of the simplest ways to establish credit because it does not require a traditional credit card or loan approval. Just use your KOHO account normally and your credit history builds automatically.

2. Get a Secured Credit Card

A secured credit card requires a deposit (usually $20000-$50000) that serves as your credit limit. Because the bank holds your deposit as collateral, these cards are available to newcomers with no credit history. Use it for small purchases and pay the full balance every month.

3. Pay Everything on Time

Payment history is the single most important factor in your credit score. Set up automatic payments for your phone bill, utilities, and any other recurring payments to ensure you never miss a due date.

4. Keep Credit Utilization Low

Once you have a credit card, try to use less than 300% of your available credit limit. If your limit is $1,000000, keep your balance below $30000. This demonstrates responsible credit management to the credit bureaus.

Banking Fees to Watch Out For

Canadian banking fees can add up quickly if you are not careful. Here are the most common fees newcomers encounter and how to avoid them.

Using KOHO eliminates most of these fees entirely. There are no monthly fees on the free plan, no NSF charges (it is a prepaid account so you cannot overdraw), and Interac e-Transfers are free.

International Money Transfers

Most newcomers need to transfer money from their home country to Canada. Traditional bank wire transfers charge $15-$800 per transfer and offer poor exchange rates. We recommend using specialized services that offer better rates and lower fees.

Once your money is in Canada, deposit it to your KOHO account via Interac e-Transfer from a Canadian bank account, or set up direct deposit with your employer to have your pay deposited directly.

Common Mistakes Newcomers Make

• Accepting the first bank offer at the airport -- Airport banking kiosks are convenient but rarely offer the best products. Sign up for KOHO on your phone instead and compare options at your own pace.
• Not building credit early -- Start building credit from day one using KOHO's credit building feature. Your future self will thank you when you apply for a rental or mortgage.
• Paying unnecessary fees -- There is no reason to pay monthly banking fees in Canada. Free options like KOHO and Neo Financial offer better features and rates than paid Big Five accounts.
• Keeping all savings at a Big Five bank -- Big Five banks pay 00.001% on savings. Move your savings to KOHO (up to 5%) or EQ Bank (2.500%) immediately.
• Not setting up direct deposit -- Ask your employer to deposit your pay directly to your KOHO account. This eliminates cheque cashing delays and fees.

Our Recommendation

For newcomers to Canada, we recommend this two-step approach:

1. Day 1: Open a KOHO account with code 45ET55JSYA. You will have a virtual Mastercard within minutes, earn interest from day one, and begin building credit. Get $200 when you spend $200, plus $10000 for each friend you refer -- $10000 total on the same day.
2. Week 1: Open a Neo Financial account for additional cashback at 100,000000+ Canadian merchants. Use Neo for everyday shopping and KOHO for savings and credit building.

This combination gives you the highest interest rates, the most cashback, credit building, and no monthly fees. You can always add a traditional bank account later if you need branch access or specific products like a mortgage.