Understanding Canadian Banking Fees: A Complete Guide for Newcomers

Opening a bank account is one of the first things newcomers do when they arrive in Canada, but many are surprised by the variety of fees that Canadian banks charge. Unlike in some countries where basic banking is free, Canadian banks typically charge monthly fees, transaction fees, and various service charges that can add up to hundreds of dollars per year if you are not careful. Understanding these fees and knowing how to minimize them is an important part of managing your finances in Canada.

This guide breaks down the most common banking fees in Canada, explains how they work, and provides practical strategies to keep more money in your pocket. Whether you are choosing your first Canadian bank account or looking to reduce the fees you are already paying, this information will help you make smarter banking decisions.

Monthly Account Fees

Most Canadian banks charge a monthly fee for chequing accounts, which is the type of account you use for everyday banking (paying bills, receiving your paycheque, making purchases with your debit card). The monthly fee varies depending on the bank and the account type, and it typically ranges from about $4 for a basic account with limited transactions to $30 or more for a premium account with unlimited transactions and additional perks.

What Monthly Fees Cover

The monthly fee usually includes a set number of transactions (debit purchases, bill payments, cheques, withdrawals) and access to online and mobile banking. Basic accounts might include 12 to 25 transactions per month, while premium accounts offer unlimited transactions. If you exceed the included number of transactions on a basic account, you will typically be charged $0.50 to $1.50 per additional transaction.

Here is a general comparison of monthly fees at major Canadian banks for their most basic chequing accounts as of early 2026:

• RBC Royal Bank: Day to Day Banking account, approximately $4 per month, includes 12 transactions
• TD Canada Trust: Minimum Chequing Account, approximately $3.95 per month, includes 12 transactions
• Scotiabank: Basic Banking account, approximately $3.95 per month, includes 12 transactions
• BMO: Performance Plan, approximately $4.00 per month, includes 12 transactions
• CIBC: Everyday Chequing Account, approximately $4.00 per month, includes 12 transactions

ATM Fees

Automated Teller Machine (ATM) fees are one of the most common and easily avoidable banking costs. When you use your own bank's ATM, withdrawals are usually free (or included in your monthly fee). However, when you use another bank's ATM, you may be charged two separate fees: a fee from the ATM owner (typically $1.50 to $3.00) and an additional fee from your own bank for using a non-network ATM (typically $1.50 to $2.00). This means a single withdrawal from a non-network ATM could cost you $3 to $5 in fees.

How to Avoid ATM Fees

The simplest way to avoid ATM fees is to use your own bank's ATMs whenever possible. Most major banks have extensive ATM networks across Canada, and you can use their mobile apps to find nearby ATMs. Some banks also participate in shared ATM networks that allow free withdrawals. For example, some credit unions share the EXCHANGE network, which gives their members access to thousands of ATMs across Canada without fees.

Another strategy is to get cash back when you make a purchase at a store. Many retailers in Canada offer cash back with debit card purchases at no additional charge. This effectively lets you make a free withdrawal every time you shop. You can also reduce your need for cash by using your debit card, credit card, or mobile payment apps for most purchases, since the vast majority of Canadian businesses accept electronic payments.

Interac e-Transfer Fees

Interac e-Transfer is Canada's most popular method for sending money between individuals. It allows you to send money directly from your bank account to another person's bank account using their email address or phone number. Most major banks now include e-Transfer as a free feature with their chequing accounts, but some basic accounts or certain banks may charge $1 to $2 per transfer.

Receiving an e-Transfer is always free, regardless of your bank or account type. Some banks also offer auto-deposit, which automatically deposits incoming e-Transfers into your account without requiring you to answer a security question. This is both more convenient and more secure than manual deposits.

e-Transfer Limits

Each bank sets its own limits for e-Transfer amounts. Typical limits are $3,000 per transaction and $10,000 to $20,000 per week, though some banks offer higher limits for premium accounts or by request. If you need to send larger amounts, you may need to use a wire transfer, which carries much higher fees (typically $15 to $50 for domestic transfers and $25 to $80 for international transfers).

Foreign Exchange Fees

As a newcomer, you may need to convert money from your home country's currency to Canadian dollars, or send money back to family members abroad. Foreign exchange (FX) fees are charged whenever you convert one currency to another, and they can be surprisingly expensive if you are not careful.

How Foreign Exchange Fees Work

When you exchange currency, the bank or service provider applies a markup to the mid-market rate (the "real" exchange rate that you see on Google or financial news sites). Canadian banks typically charge a markup of 2% to 3% on the mid-market rate, which means you pay more when buying foreign currency and receive less when selling it. In addition to the markup, banks may charge a flat fee for the transaction, especially for wire transfers.

For example, if the mid-market rate for Indian rupees to Canadian dollars is 1 CAD = 60 INR, your bank might offer you a rate of 1 CAD = 58.5 INR, keeping the difference as its fee. On a transfer of $1,000, this could mean losing $25 or more to the exchange rate markup alone, plus any wire transfer fees.

How to Get Better Exchange Rates

To minimize foreign exchange costs, consider using specialized money transfer services such as Wise (formerly TransferWise), Remitly, or OFX, which typically offer rates much closer to the mid-market rate with lower fees than traditional banks. Compare rates and fees across multiple providers before making a transfer. The FCAC guide to sending money internationally provides helpful tips for newcomers.

If you are building your financial foundation in Canada, you may also be interested in our guide to building credit history as a newcomer, which covers essential financial steps beyond banking.

How to Avoid or Reduce Banking Fees

There are several effective strategies for minimizing the banking fees you pay in Canada. Here are the most practical approaches for newcomers:

Maintain a Minimum Balance

Most major banks will waive your monthly account fee if you maintain a minimum daily balance in your account. The required balance varies by bank and account type but typically ranges from $3,000 to $5,000 for mid-tier accounts and $4,000 to $6,000 for premium accounts. If you can keep this amount in your account at all times, you effectively get free banking with unlimited transactions.

Consider Credit Unions and Online Banks

Credit unions are member-owned financial institutions that often offer lower fees and better interest rates than the big banks. Some credit unions offer free chequing accounts with unlimited transactions. Online-only banks such as Tangerine (owned by Scotiabank) and Simplii Financial (owned by CIBC) also offer no-fee chequing accounts with unlimited transactions, free e-Transfers, and access to their parent bank's ATM network.

Bundle Your Banking

If you have multiple products with the same bank (chequing account, savings account, credit card, mortgage, or investments), you may qualify for a multi-product discount that reduces or eliminates your monthly fee. Ask your bank about bundling options and loyalty programs.

Banking Rights for Newcomers

It is important for newcomers to know that Canadian banks cannot refuse to open a basic account for you simply because you do not have a job, a minimum deposit, or a credit history. Under the Bank Act, federally regulated banks must open an account for any individual who provides acceptable identification, even if you have no money to deposit and no other banking relationship. The FCAC provides detailed information about your rights as a banking consumer.

If you experience any issues with your bank, such as being unfairly charged or denied service, you can file a complaint with the bank's internal complaints department. If the issue is not resolved, you can escalate it to the bank's ombudsman or to the Financial Consumer Agency of Canada.

Making Smart Banking Choices

Understanding banking fees is just one part of building a strong financial foundation in Canada. As a newcomer, it is also important to start building your credit history, understand the Canadian tax system, and plan for long-term financial goals such as buying a home or saving for retirement. Our guide to building credit history is an excellent next step for newcomers who want to establish strong financial footing in Canada.

WelcomeAide is committed to helping newcomers navigate the financial landscape of Canada. Our AI Newcomer Navigator can answer your questions about banking, taxes, credit, and other financial topics in your language. Explore our blog for more newcomer guides, learn about our mission, or see how to get involved in supporting newcomer communities across Canada.