In Part 1, we covered how to cut your monthly bank fees to $0. Now the question is: where should you put the money you are saving?
Leaving extra cash in a regular chequing account earns you almost nothing in Canada. But choosing the right HISA (High-Interest Savings Account) can get you 2–3%+ per year. On $10,000, that is a difference of more than $300 a year — money you get for doing nothing except moving your account once.
⚠️ Updated August 2026. All rates in this article are based on publicly available information as of early August 2026. Interest rates change with Bank of Canada policy decisions and promotional cycles. Always verify the current rate directly with each institution before opening an account.
What Is a HISA, and Why Chequing Costs You Money
A HISA is a high-interest savings account. The name sounds technical, but the structure is simple: you can deposit and withdraw whenever you want, just like a regular savings account, but the interest is far higher. Unlike a GIC (term deposit), your money is not locked up until maturity.
That makes the use case clear. A HISA is where you park your emergency fund, money you will need within a few months, or cash you have not decided how to invest yet. Think of a car fund for next year, a rental deposit you got back, or a tax refund.
Now consider what happens if that money sits in a chequing account instead. Big 5 chequing accounts typically pay around 0.01%. Leave $10,000 there for a full year and you earn $1. Not even a coffee. And if that same account is charging you a monthly maintenance fee, the fee dwarfs the interest and you are net negative — which is exactly the problem we solved in Part 1.
Where Rates Stand in a 2.25% Policy Rate Environment
To understand HISA rates, start with the policy rate. The Bank of Canada rate sits at 2.25% as of August 2026, held for the sixth consecutive decision on July 15. The next announcement is September 2.
For savers, this means the golden age of interest is over, but it is not gone. Back in 2023–2024 when the policy rate was 5.00%, HISAs paying 4–5% were common. Those are gone. What remains is the 2.75–3.40% range, which is still respectable once you account for inflation.
The direction matters more than the level. Markets broadly expect the policy rate to stay near this level through the rest of 2026. In other words, if you move to a good HISA now, that rate is likely to hold for a while. Waiting for rates to climb while your money sits in a Big 5 account just means giving up interest in the meantime.
Big 5 Bank HISA Rates — Honestly Disappointing
Let us start with the large banks. The short version: do not get your hopes up.
| Bank | HISA rate (August 2026) | Notes |
|---|---|---|
| TD | 0.01% – 1.00% | Near zero without a promotion |
| RBC | 0.01% – 1.05% | Only rises during promo periods |
| BMO | 0.01% – 1.10% | Conditional tiers required |
| Scotiabank | 0.01% | Higher only with bundled products |
| CIBC | 0.01% – 1.00% | Reverts after promo ends |
Seen on a chart, the gap is obvious. Big 5 base HISA rates are effectively meaningless. They spike briefly during promotions and then quietly fall back, so if you miss the end of a promo your money can sit at 0.01% without you noticing.
Why is this? The Big 5 carry the cost of branch networks and ATM fleets, and they recover that cost partly by paying depositors less. Online-only banks have no branches, so they can pass that saving through as interest. It is a structural difference, which means this gap is unlikely to close.
Option 1: EQ Bank — The Balance of Convenience and Rate
The best-known high-interest online bank in Canada.
- Base rate: 1.00%
- Conditional rate: 2.75% with recurring direct deposits of $2,000+ per month
- Monthly fee: $0
- Withdrawal limits: none
- CDIC insured: up to $100,000
- Extras: prepaid Mastercard with no foreign transaction fee
EQ Bank’s real strength is not the rate — it is that you can use it like an everyday account. Interac e-Transfers are free and unlimited, so it works as a chequing substitute. Set up your payroll deposit and the 2.75% applies automatically.
One caution: if the condition lapses, you drop to 1.00%. Change jobs or redirect your payroll and the rate falls with it — and no one sends you a warning.
Option 2: Canadian Tire Bank — Rewards Integration
This one surprises people, but Canadian Tire holds a banking licence and runs a HISA.
- Rate: approximately 2.40%
- Monthly fee: $0
- CDIC insured: yes
- Notable: integrates with Triangle Rewards
The rate is slightly below EQ Bank, but there are no conditions to meet. You get 2.40% without arranging a payroll deposit. If you shop at Canadian Tire regularly, the rewards integration is convenient — and for most newcomer households, Canadian Tire spending adds up more than you would expect between tools, auto supplies, and household goods.
Option 3: Oaken Financial — Top of the Rate Table
If you are optimizing purely for rate, this is the strongest option.
- Rate: approximately 3.40%
- Monthly fee: $0
- CDIC insured: yes (Home Bank and Home Trust each carry separate limits)
- Notable: GIC rates are also among the best in Canada
Oaken is a Home Trust brand. It has very few branches and runs mostly online and by phone, and the app is not as polished as EQ Bank’s. You trade convenience for yield.
That shapes the use case. This is not where you keep money you move every week — it is for funds you will not touch for six months to a year. In practice, separating money you use from money you do not is the whole trick.
The Promotional Rate Trap — Do Not Chase 4.60%
Here is something worth pausing on. Search for HISAs and you will see eye-catching 4%+ headline numbers. As of August 2026, Simplii Financial is running a 4.60% offer for new clients, and there are always a few of these circulating.
The conditions are where it falls apart. These promotions almost always work like this:
- Applies only to new clients or new money
- Lasts 3–6 months (Simplii’s runs for the first 5 months, ending October 30, 2026)
- Reverts automatically to a base rate under 1%
- Often with no notification when it reverts
In other words, the big number is temporary, and what actually matters is the base rate afterward. An account paying 3.40% all year beats one paying 4.60% for five months and 0.5% for the other seven.
If you want to use promotions, do it deliberately: put the end date in your calendar and move the money before it expires. If you will not track that, start with the account that has the best base rate instead.
What $10,000 Actually Earns in a Year
Percentages are abstract. Here is the interest on $10,000 left untouched for a year.
Big 5: $100. Oaken: $340. A difference of $240 — earned by doing nothing but moving an account.
The gap scales. At $50,000 it is $1,200 a year. If you are saving a home down payment, $100,000 works out to roughly $2,400 a year. That is no longer a rounding error.
Side-by-Side Comparison (August 2026)
| Bank | HISA rate | Monthly fee | CDIC | Notes |
|---|---|---|---|---|
| EQ Bank | 1.00% base / 2.75% conditional | $0 | Yes | Most convenient, card included, unlimited e-Transfers |
| Canadian Tire Bank | ~2.40% | $0 | Yes | No conditions, Triangle Rewards |
| Oaken Financial | ~3.40% | $0 | Yes | Highest rate, weakest app |
| Simplii (promo) | 4.60% (first 5 months) | $0 | Yes | Drops sharply after; track the end date |
| TD / RBC / BMO etc. | 0.01–1.10% | Paid | Yes | Branches and ATMs, but no meaningful interest |
Rates change over time. Always confirm the current rate on the institution’s official site before opening an account.
HISA vs GIC — When to Switch
If your money can be locked up longer, it is worth looking at GICs. As of August 2026, 1-year GICs reach 3.30–3.60% and 5-year GICs reach 4.00–4.10% — above even the best HISA.
The decision rule is straightforward.
| Situation | Right product | Why |
|---|---|---|
| Money you might need within 3 months | HISA | Must stay liquid |
| Emergency fund (3–6 months of expenses) | HISA | Job loss or medical costs |
| Money you definitely will not touch for a year | 1-year GIC | Better rate than HISA |
| Long-term or retirement funds | 5-year GIC or investing | Locks in against rate cuts |
A rate-hold period is generally considered a good time to commit to a GIC. With neither a sharp rise nor a sharp drop expected, the risk of locking in for a few years is comparatively low. That said, GICs usually cannot be broken early without forfeiting interest, so do not put your emergency fund in one.
CDIC Insurance — For Anyone Nervous About Online Banks
“Should I really put money in a bank I have never heard of?” is a fair question. I asked it too.
Canada has a federal deposit insurance program called CDIC (Canada Deposit Insurance Corporation). If a member institution fails, CDIC covers principal and interest up to $100,000 per depositor, per institution, per account category. EQ Bank, Canadian Tire Bank, and Oaken Financial are all CDIC members.
A few practical points:
- Coverage is per institution, so $200,000 split across two banks is fully covered
- Coverage is also per account category (non-registered, TFSA, RRSP each count separately)
- Oaken operates as both Home Bank and Home Trust, effectively doubling available coverage
- You can verify membership by searching the institution on the CDIC website
So below $100,000, an online bank is exactly as safe as a Big 5 bank. Knowing that made the decision to move much easier for me.
My Recommended Setup — Three Tiers
The key is splitting accounts by the purpose of the money. Keeping it all in one place is simpler but costs you.
| Type of money | Where to keep it | Why |
|---|---|---|
| Everyday spending | Simplii or EQ Bank chequing | $0 fees, daily transactions |
| Emergency fund (3–6 months) | EQ Bank HISA (2.75% conditional) | Liquid and still earning |
| Longer-term savings (6+ months) | Oaken HISA or 1-year GIC | Maximize interest |
Keeping everything at a Big 5 bank means earning no interest while paying fees — a loss on both sides. If you need branch access, keep the Big 5 account at its minimum balance and move the rest.
Frequently Asked Questions
Q. Can I open multiple HISAs? Yes. There is no limit and no effect on your credit score. Two or three is realistic before it becomes a hassle to manage.
Q. Is HISA interest taxable? Yes. Interest in a non-registered HISA is fully taxable as interest income, and you will receive a T5 slip. To avoid this, you can hold a HISA inside a TFSA, where the interest is tax-free.
Q. Can newcomers open online bank accounts? Yes. A SIN, a Canadian address, and government ID are usually enough to open online. Approval may take a few days if you have no credit history yet.
Q. When is interest paid? Most institutions pay monthly, accrued daily and deposited at month end or early the following month.
Q. Any downside to leaving my old bank? Not really. But closing a Big 5 chequing account can end bundled perks tied to a minimum balance — waived credit card annual fees, for example. Check your package terms before closing.
Summary
If you want real interest on your savings in Canada, Big 5 HISAs are not the answer. Their business model structurally requires paying depositors less.
Pick whichever fits your situation — EQ Bank for convenience, Canadian Tire Bank for no conditions, Oaken Financial for the highest rate — and simply moving your idle cash is worth hundreds of dollars a year. With CDIC covering up to $100,000, safety is not the concern people assume it is.
With the policy rate held at 2.25%, rates are unlikely to move much in the near term. Move now and the terms should hold. Just judge accounts on their base rate, not the promotional headline.
In Part 3, we compare credit cards — cash back versus points, and exactly where paying an annual fee starts to pay off.
Related Reading
- Paying Canadian Bank Fees Every Month? Here’s How to Get to $0 — 4 Methods That Actually Work
- Cash Back or Points? Choosing the Right Credit Card in Canada as an Immigrant
- Bank of Canada Holds at 2.25% Again — What It Means for Your Mortgage Renewal, HISA, GIC, and Rent
- RRSP Contribution Limit 2026: How to Check Your Limit and Maximize Your Tax Refund
- 3 Common TFSA Mistakes: Over-Contribution, Re-Contribution Timing, and What to Do When You Leave Canada
- The CESG Catch-Up: How Late Starters Still Collect $7,200