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Canadian High Interest Savings Accounts go head to head

First Posted: December 1, 2004
Last Updated: September 19, 2009

By Denis Agar

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Signup Bonuses

In the long term, signup bonuses don't really mean anything. They can, however, make it easier to choose between two banks that may be very similar. Here are the bonuses offered by each bank.

Bank	Bonus
Achieva	One Free Chequebook (25 cheques): In an age where 50 cheques can easily cost more than $25, this is a welcome discount. You shouldn't be surprised that using these cheques will run you $1 each, so in the end, that chequebook could end up costing you $25 anyway.
Outlook
ICICI	A referral scheme: If you tell someone about ICICI, and they sign up, you get $20 and they get $20. [Maximum $500; not available in Manitoba, Quebec, and Nova Scotia]
ING Direct	A referral scheme whereby if you tell someone about ING, you get $25 and they get $25 as long as they deposit at least $100.
MAXA Financial	12 Cheques

Conclusions

The Best

Peoples Trust
This strange offering appeared on our radar in 2008. It feels like a bit of a mom-and-pop operation with no online banking and a website full of stock photos. Either way, the bank is just as insured as any of the other players and you can't argue with their great rate. The easiest way to transfer funds is to send them an e-mail request. They give 4 free cheques to start you off, and you can use those to link your account to another bank that does have online banking, like ICICI (Unfortunately, you can't use PC Financial because they require that the cheque you send them has your information pre-printed on it, and Peoples issues you four cheques where you have to write in your personal info. The work around for this is to order printed cheques from them at considerable cost, or as was suggested in the forum, order cheaper cheques from a third party.) Other potential issues are the 9-day hold on incoming funds. The hold is only placed on transfers initiated with Peoples Trust. If you start the transfer from the other bank (ICICI, Citizens, etc), you should have immediate access.

Ally
General Motors has decided to enter the high interest savings arena, and they're probably wise not to make their name prominent, considering the company's prospects. Not to worry, though, your funds would be safe here. They pay slightly less interest than Peoples Trust but the advantage is that you have online banking at your disposal. It make life just that much easier.

The Rest

ICICI
Their interest rate is exceptional, but not the best. One reason to choose ICICI might be for the wide range of free access methods. You can use your card anywhere in the world for free, which is strange for a savings account. For those needing to transfer money back and forth from India, ICICI offers a few interesting options. A warning: many seem to have had problems with ICICI, stemming mostly from poor customer service. There seem to be plenty of people, though, that have been fine with ICICI. Your mileage may vary.

Achieva / Outlook / MAXA Financial / Canadian Direct Financial
These players are all crippled by the fact that they limit you to one withdrawal per month. They all have decent rates, but Ally, Peoples Trust, or ICICI would probably be a better choice.

All the other guys
Rates have gotten so low that even the best offerings in this article are lower than the worst offerings from 9 months ago. All the accounts I haven't mentioned yet aren't worth mentioning. Perhaps things will pick up, but for now, stick with Peoples, Ally, or ICICI.

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