5 Digital Banking Alternatives to Chime in Canada (2023)

is chime bank in canada

Chime is an alternative to traditional banks. It doesn’t have physical branches, and everything is done via the Chime app. First and foremost, it’s focused on the US market. But does Chime also work in Canada, and is it available to Canadian citizens?

Is Chime Bank available in Canada?

Chime bank accounts aren’t available in Canada yet, but the company is now also incorporated there, so it’s perhaps only a matter of time before they start offering accounts and cards to Canadians. 

Canada, of course, would be a natural fit for its operations, although there is some serious competition from homegrown Canadian digital banks

Chime opened its first and only non-American office in Vancouver to become lawfully incorporated in Canada at the end of 2020. Based on news reports, the Vancouver office has 20 employees that mostly make up an engineering team.

However, according to news reports, the company planned to hire 100 people by the end of 2021 to work in the other departments. It’s not known whether the company actually followed through on that. 

Does The Chime Card Work in Canada?

You can use the Chime debit or credit card with no issues outside of the US (including Canada) because it’s a Visa card that’s accepted almost everywhere. You just have to ensure that you enable international transactions in the app if you haven’t already. 

There’s also a list of 27 blocked countries in which you won’t be able to use the cards. Notably, Croatia, Serbia, Ukraine, Bosnia-Herzegovina, Belarus, Russia, and some other well-known countries are included. 

Chime Alternatives in Canada

digital banks canada comparison

As the neobank plans to fully launch its international presence in Canada, it would be up against established, homegrown, global fintech firms. 

In Canada, Chime faces the following digital banks:

  1. KOHO
  2. Tangerine 
  3. Motusbank 
  4. EQ Bank
  5. Oaken Financial
  6. Simplii Financial
  7. Alterna Bank
  8. STACK
  9. Neo Financial

In addition, more than 99% of Canadians have a bank account or an account in a financial institution, which means non-account holders are an extremely small market.

Digital banks in the US have to partner with fully-fledged banks. The same is true in Canada as well. For that reason, just like Chime’s services are provided by The Bancorp Bank or Stride Bank, N.A., Members FDIC, the company would have to partner with some of Canada’s prominent banks who don’t have a digital-only bank such as BMO, RBC, and TD.

Let’s continue to see what alternatives for Chime are there in Canada. Here’s a breakdown of the top digital banks.

READ ALSO: 6 Payday Loans Apps that Accept Chime (How to Get)

1. EQ Bank

eq bank canada

EQ Bank was launched in 2016 and was Canada’s first digital bank. Today, it’s known for having one of the best interest rates in Canada. 

It’s powered by Canada’s challenger bank, Equitable Bank, which was founded over 50 years ago. EQ is well-known in Canada, with more than 250,000 clients and more than $7 billion in deposits.

The Savings Plus Account is its flagship product that makes this bank one of the best for interest rates in Canada. We’re talking about a non-promotional savings rate of 2.50% that’s calculated daily and paid monthly. 

With this account, customers enjoy free Interac e-Transfers, free bill payments, and no monthly fees. The rate is also the same for a joint and TFSA savings account.

EQ Bank manages to keep the interest so high because they have a maximum balance of $200,000 with no monthly or annual fees. 

Withdraw your money from your EQ bank account via an Electronic Fund Transfer (EFT) connected to your account or via Interac e-Transfer.

And lastly, EQ Bank also has a US dollar account that earns an interest of 2.00% on every dollar. On top of that, there are no monthly fees, and it’s a cheaper way of sending dollars abroad.

2. Tangerine

Tangerine bank was launched as ING DIRECT Canada all the way back in 1997. In 2012, however, the bank got acquired by Scotiabank, which also changed its name to Tangerine in 2014. Like Chime, this is purely an online bank.

Tangerine offers high interest on the savings account, a chequing account with no fees on daily transactions, and credit cards with cashback rewards. 

In addition, there are also the business account, investment funds, credit lines, mortgages, RSPs, and tax-free savings accounts.

Tangerine is one of the best in the market compared to other credit cards. It has unlimited money-back rewards on daily purchases and no annual fee.

The money-back credit card gives you a 2% cashback reward in two 2% money-back categories of your choice, as well as 0.50% rewards on all your other everyday purchases.

You can put the money-back into your savings account or apply it to your credit card. The 2% money-back can be utilized in:

  • Restaurants 
  • Furniture stores
  • Gas stations 
  • Groceries
  • Drug stores
  • Public transportation
  • Recurring bill payments

The Tangerine credit card comes with absolutely no annual fees. It also has an interest in purchases at 19.95%. 

Additionally, if you buy something using the money-back credit card, you could get insurance coverage of up to $60,000, plus purchase assurance cover for 90 days and an extended warranty.

Since they don’t have any physical branches, all the banking services are transacted online and via the Tangerine mobile banking app, available on the App Store and Google Play.

On top of all these banking services, Tangerine is also good for investors who want to get business accounts and earn money via investment portfolios. With all these benefits, Tangerine is an excellent, if not better, alternative to Chime.

READ NEXT: Chime Bank Vs Aspiration: The 6 Key Differences

3. Motusbank

motusbank

Motusbank is the latest entrant into the online banking space in Canada. Launched in 2019, before the pandemic, the bank is a subsidiary of Meridian, one of Canada’s largest and most popular credit unions. 

As is the case with other banks on our list, Motusbank is a member of the Canada Deposit Insurance Corporation (CDIC). This means that your funds are insured for up to $100,000. 

It, too, doesn’t have physical locations. This means that you have to access all services online or via the app.

The bank has attracted clients with its customer-tailored benefits, such as low-to-no fees and high-interest rates.

Additionally, Motusbank’s chequing account has no monthly fees. It offers:

  • Free and unlimited Interac e-Transfer 
  • No minimum balance 
  • Unlimited debit purchases 
  • Bill payments
  • Free withdrawals

They also offer no-fee access to over 43,000 surcharge-free ATMs in North America via THE EXCHANGE Network in Canada and Allpoint Network in the US. 

They also have a savings account, just like Chime. With the high-interest savings account, you can earn 2.1% regardless of your balance. In addition, they also have tax-free and retirement savings accounts.

Lastly, Motusbank also offers mortgages, GICs, loans, and investment plans.

4. Oaken Financial

oaken

Oaken is also a good savings account alternative to Chime. They have very competitive interest rates that are an alternative to what Chime Bank offers.

Oaken was launched in 2013 as a financial platform to help people manage their savings. It’s backed by Home Bank and powered by Home Trust Company, Canada’s largest independent trust company that’s been in existence since 1987.

With a primary focus on savings, their savings account has a high-interest rate of 3.40% and comes with no minimum balance and no monthly fees. Your money is safe with Oaken Financial because the accounts are eligible for CDIC coverage up to $100,000.

The biggest benefit from Oaken is the whopping 5.15% interest rate on Guaranteed Investment Certificates (GIC) – the best GIC offering in Canada.

The terms range from 30 days to 5 years; therefore, you can find a plan that suits your needs and timelines. GICs are a safe investment because your principal and interest rate are both guaranteed.

Once you sign up for this financial plan, you can either use Home Bank or Home Trust Company as insurers for your deposit. They are both members of the CDIC.

RELATED: How to Put Money on Chime Card (The 6 Ways)

5. KOHO

koho

Established in 2017, KOHO is a fintech company and not a bank. KOHO partners with various banks and CDIC-insured institutions to deliver financial products. Most notably with the Peoples Trust Company.

KOHO offers a free Visa pre-paid card integrated with an app that allows you to earn cashback. Peoples Trust Company offers these pre-paid cards. They have also partnered with established investors such as Drive Capital, Power Group, and Portag3.

Once customers sign up with KOHO, they get cash back, earn interest, and grow their savings at no fee.

Similar to Chime, there are savings and chequing accounts. When you make a direct cash deposit, you earn a 1.2% interest rate. If you are connected to the app, you can automate your saving, track your spending, and use features such as Goals and Roundups.

The key features that come with this account include a 0.5% cashback on all purchases, which increases to 2% with the KOHO premium. They also have an early payroll benefit that’s prominent among digital banks in the U.S. To become eligible for the early paycheck, you’ll need to set up a direct deposit.

With this feature, you can access up to $100 up to 3 days before your paycheque for free or pay $5 to get immediate access to $100 plus a financial coach for 15 days.

KOHO is also suitable for credit building. Their credit building facility requires you to subscribe for $7/month on the app. As long as there’s $7 each month in your spending account, they’ll report your progress to major credit bureaus, which allows you to build your credit history within six months.

With a 4.8 App Store rating, their app is well functioning and attracts a lot of Canadian clients. If you have Apple Pay, you can link it to your KOHO account and use your iPhone to pay for purchases and services.

READ NEXT: How Does Chime Make Money? | Over $200 Million Revenue

Conclusion

Canadian digital banking space is on fire right now. There are many challenger banks that are similar to Chime and offer their customers a lot of benefits. 

Customer satisfaction is certainly in focus with them, as well as the continued tradition of having no fees on most of their products, free unlimited transactions, cashback, and no ATM withdrawal fees.

These Canadian online banks also offer superb high-interest rates that are not available in other banks or in the United States. As more people switch to these convenient alternatives, challenger banks have found a way to attract customers with benefits and financial products.

Until Chime makes a more significant presence in Canada, your best bet is to choose one of the above banks. 

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