Over the last decade, online banks continue to take over the financial scene from the big banks and their high fees plus low-interest rates. These banks prioritize zero fees and high interest rates, providing Canadians real value for their money. EQ Bank vs Tangerine Bank are two of the best online banks in Canada. They offer a lot in this domain and stand out as major contenders for Canada’s top digital bank title.
- Why You Should Opt for an Online Bank in Canada
- EQ Bank Briefly
- Tangerine Bank Briefly
- Overview: EQ Bank vs Tangerine
- EQ Bank vs Tangerine: Convenience
- EQ Bank vs Tangerine: Ease of Use
- EQ Bank vs Tangerine: High-Interest Savings Accounts
- EQ Bank vs Tangerine: TFSA and RSP Accounts
- EQ Bank vs Tangerine: Guaranteed Investment Certificates (GICs)
- EQ Bank vs Tangerine: Fees and Account Charges
- International Banking With Tangerine vs EQ Bank
- Tangerine vs EQ Bank: Credit Cards and Cheques
- EQ Bank vs Tangerine: Account Extras and Other Financial Products
- EQ Bank vs Tangerine: Account Safety
- EQ Bank vs Tangerine: Pros and cons
- FAQs on EQ Bank vs Tangerine
- Verdict: EQ Bank vs Tangerine
Read on to learn more about these banks’ features and products. Then we’ll go deep into a side-by-side comparison to decide on the best fit for your specific financial state.
Why You Should Opt for an Online Bank in Canada
Compared to traditional brick and mortar banks, online banks like EQ Bank and Tangerine operate solely in the online space. This allows them to avoid rent, office supplies, building maintenance, and other miscellaneous costs.
These savings result in improved banking services for customers with no-fee accounts, unlimited free e-transfers and withdrawals, and high interest as standard features.
The only downside to these banks is the inability to visit the bank physically.
EQ Bank Briefly
EQ Bank is a leading online bank in Canada and the digital arm of Equitable Bank. While Equitable Bank was established in 1970, EQ Bank started providing digital banking services in 2013. Some of its offerings are a high-interest savings account (known as Savings Plus Account), GICs, and TFSAs.
The features of EQ Bank’s savings and GIC account offerings include:
- No monthly fees or minimum balance (minimum of $100 on GICs).
- High-interest savings rates.
- Unlimited free electronic fund transfer
- Unlimited bill payments
- Unlimited free Interac e-transfers Monthly.
- Low-cost international money transfer.
- Free mobile cheque deposits
The upside of the bank operating strictly online is they save money on rent, building and maintenance costs and pass these savings to consumers through higher savings interest rates. Although there’s no physical location, you can always speak with someone on the phone if you have any concerns or questions.
EQ Bank also partners with TransferWise to help customers save costs on international money transfers. However, they don’t offer chequing accounts or credit card products.
Tangerine Bank Briefly
Tangerine Bank is an online-only bank and a subsidiary of Scotiabank with about two million customers and C$38 billion assets. It was formerly known as ING Direct before Scotiabank purchased it in 2012, and then it became Tangerine in 2014.
Since then, its financial offerings have grown into various products like savings, GICs, chequing accounts, personal loans, and mortgages. Tangerine accounts are known for their low fees and an above-average return on your investment (ROI).
It does not have branches, but you can walk into Tangerine pop-up locations, kiosks, and cafes located in major cities around the country if you must speak to someone physically. You also have access to a 24/7 call centre and over 44,000 ATMs worldwide through Scotiabank’s Global ATM Alliance.
Tangerine Bank offers these financial products:
- Savings Account and GICs
- Investment: RRSP, TFSA, RRIF and Tangerine Investment Funds.
- Spending: Tangerine 2% Money-Back Credit Card and No-Fee Chequing Account.
- Lending: HELOC, Mortgage, and RRSP Loans
These are the features you can expect to enjoy on their savings and chequing accounts:
- No monthly fees.
- Up to 0.10% interest on your chequing account balance.
- Free and unlimited debit transactions, bill payments, and pre-authorized payments.
- No minimum account balance.
- They have an Automated Savings Program.
Overview: EQ Bank vs Tangerine
|Monthly Transactions||Free and Unlimited||Free and Unlimited|
|Free Interac eTransfer||Yes||Yes|
|Promotion Rate||2.3% TFSA||2.1% High-Interest Account (HISA)|
|Savings Account Interest Rate||1.25%||2.10%, 0.1% after five months.|
|5-Year GIC Rates||1.80%||1.45%|
|International Money Transfers||Low-Cost Deal with Transferwise||No SWIFT/BIC code, so Tangerine can not send international transfers.|
|Credit Card and Cheques||Nil||Yes|
EQ Bank vs Tangerine: Convenience
Generally, both banks do not have a physical presence. But if meeting people physically is a requirement for you, you may be able to find a Tangerine pop-up location depending on where you stay. Tangerine Bank handles everything from savings and chequing accounts to investing, RRSP, TFSA, and RRIF. So you can practically move all your banking needs under their umbrella.
EQ Bank, on the other hand, has no chequing account. However, its savings account functions like a hybrid account as you can deposit cheques into it and make bill payments. Transfers are completely free, and you can link up to ten accounts from other banks. EQ Bank also currently offers RRSP and TFSA accounts.
Regarding ATMs and cash withdrawals, Tangerine Bank customers have access to more than 44,000 Scotiabank ATMs worldwide. EQ Bank, however, does not currently offer a debit card or direct ATM access for cash withdrawals. All transactions are done online. Both banks have functional mobile apps that can be accessed on both iOS and Android devices.
EQ Bank vs Tangerine: Ease of Use
As a strictly digital bank, EQ Bank is highly user-friendly. The website is easy to navigate, and adding external bank accounts is a pretty straightforward process. Application for an account takes just a few minutes, and your account can be functional in a few days after your first deposit from your external bank clears.
You can have up to ten external banks from which you can transfer funds into your EQ Bank account.
Another point in EQ Bank’s favour is they do not charge a Non-Sufficient Funds Fee (NSF fee), making it more convenient and less risky to move your money around. So if, for one reason or the other, you don’t have enough money in your account for a transfer or you accidentally transfer more than you have, unlike most banks, EQ Bank won’t charge you a fee.
The main drawback to EQ Bank is you can’t withdraw money directly from your EQ account via an ATM. If you need cash in hand, you’ll have to transfer money from your EQ Bank account to an external bank before you can withdraw funds.
Tangerine’s website is super sleek, attractive, and easy to navigate, which is appropriate for an online-only bank. Even if you are new to digital banking, you’ll find it easy to use the site.
The application process and external bank account connection are very fast, but Tangerine only permits you to link three external bank accounts. They also charge a $45 NSF fee.
EQ Bank vs Tangerine: High-Interest Savings Accounts
High interest savings accounts (HISAs) are savings accounts whose interest rates are higher than 1.05%. A high-interest savings account is an incredible financial tool that keeps your money’s value on track with inflation. If a HISA is below Canada’s present inflation rate, the money’s value will decrease slowly.
High-Interest savings accounts are non-registered accounts, so they have no contribution limits. However, the interest earned is treated as income and is therefore liable to taxation.
If you don’t like this, opt for a Tax-Free Savings Account (TFSA).
The EQ Bank Savings Plus Account
The EQ Bank Savings Plus Account offers an interest rate of 1.25%, cheap international money transfers, direct and mobile cheque deposits, and unlimited free Interac e-Transfers and external account connections.
Although EQ Bank has no chequing account, the EQ Bank Savings Plus Account acts like one.
The minor disadvantage is the account has a maximum balance limit of $200,000.
The Tangerine Savings Account
The Tangerine Savings Account offers an initial 2.10% interest rate for the first five months after opening an account and subsequently 0.10%. The account also offers no minimum balance requirement and zero bank fees.
If you have a $5,000 savings goal, you’ll achieve your goal in a year if you contribute $100 weekly at the current interest rate.
The table below provides a general summary of the features of an EQ Bank vs Tangerine HISA.
|Feature||EQ Bank HISA||Tangerine HISA|
|Interest Rate||1.25%||2.10%, 0.1% after five months.|
|Free Interac e-Transfers||Yes||Yes|
|External Account Linking||Yes||Yes|
|Minimum Balance Requirements||No||No|
|International Money Transfers||Yes||No|
|Non-Sufficient Funds (NSF) Fee||None||$45|
Who’s the Winner? EQ Bank. EQ Bank comes top on this aspect for its savings account, which comes with great interest rates, international money transfers, unlimited transactions, and no fees.
EQ Bank vs Tangerine: TFSA and RSP Accounts
EQ Bank offers TFSA and RSP accounts with some of the most competitive rates in the country. Besides the tax benefits, EQ Bank’s TFSA and RSP accounts have a 2.30% interest rate — one of the best in the country.
Note: Effective May 26th, 2021, the rate becomes 1.25%.
Tangerine’s TFSA and RSP accounts offer the same interest rate as its Savings Account (0.10%). Both accounts also have no minimum balance requirements and banking fees.
Who’s the Winner? EQ Bank.
EQ Bank’s interest rates on cash holdings are about twenty times what Tangerine offers. Coupled with no fees, EQ Bank is the clear winner in this category.
EQ Bank vs Tangerine: Guaranteed Investment Certificates (GICs)
Guaranteed Investment Certificates (GICs) are investments with insurance in their principal investment and their interest. The term’s deposit length differentiates GICs. The terms can be as short as a month and as long as ten years.
Money deposited into a GIC is not accessible till the GIC reaches maturity, I.e., when the term reaches its end date. In contrast to HISAs, there are a few different types of GICs.
You can avoid taxes on your GICs by placing them in a registered GIC, like an RRSP GIC or a TFSA GIC. Non-registered GICs are taxed once they’ve matured.
EQ Bank Guaranteed Investment Certificates (GICs)
EQ Bank is known for its great GIC rates. It offers flexible options for both short-term and long-term GICs, with rates going from as low as 1.50% and as high as 2.25%. The terms start as short as three months and go up to ten years.
All the terms have a $100 minimum investment requirement. Investors can review their GIC interest rates annually. EQ Bank also offers TFSA and RSP GICs.
Tangerine Guaranteed Investment Certificates (GICs)
Tangerine’s GIC rates go from 0.20% up to 1.45%. The terms start from three months and go up to five years. There are no fees, and they also offer RSP and TFSA GICs. In contrast to EQ Bank, Tangerine also offers U.S. dollar GICs and RIF (Retirement Income Fund) GICs.
Since Tangerine provides many types of GICs, it’s an appropriate option for people looking to diversify their GIC investments. One drawback to Tangerine’s GICs is that terms are not as flexible as the ones provided by EQ Bank.
|GIC Term||EQ Bank GICs||Tangerine GICs|
Who’s the Winner? EQ Bank
EQ Bank vs Tangerine: Fees and Account Charges
Both Tangerine and EQ Bank have cut down business costs linked with bank locations and transferred those savings to their customers. They offer total freedom from monthly account fees, free unlimited Interac e-transfers, and bill payments.
EQ Bank has a slight edge over Tangerine in this category because of the $10 inactivity fee Tangerine charges. However, this is a charge that won’t apply to many people.
|Monthly Account Fee||Free||Free|
|Inactivity Fee||Free||$10 After One Year, $20 Per Year Subsequently.|
|Interac Money Transfers||Free||Free|
|Account Closing Charge||Free||Free|
|Cheques||None||First 50 cheques come free; $50 subsequently.|
International Banking With Tangerine vs EQ Bank
Tangerine, a full-service digital bank, does not have a SWIFT/BIC code and thereby cannot receive international payments. On the other hand, EQ Bank shines in this aspect. They partnered with Transferwise (top-tier international money transfer company in the world) to offer customers the cheapest way possible to convert currencies.
When it comes to currency conversion, most people have little knowledge of how much banks charge because the fee is kind of hidden in the fine print. Banks take a cut on one side of the mid-market rate.
The cut depends on the currencies being exchanged and the bank. The result is customers paying more than 800% more when exchanging through their brokerage than they would with Transferwise.
Who’s the Winner? With the help from Transferwise, EQBank wins this round.
Tangerine vs EQ Bank: Credit Cards and Cheques
Tangerine Bank’s overall package is aimed at customers’ convenience, and they outshine EQ Bank in this area. Unlike EQ Bank, Tangerine permits its customers to use credit cards, cheques, and debit cards.
EQ Bank allows you to select one of Canada’s best credit cards, have your paycheque deposited in your EQ Savings Plus Account, and set your EQ Account to pay off the credit card balance automatically each month. Doing this can help you maximize the interest rate you get on your savings.
Who’s the Winner? Tangerine
EQ Bank vs Tangerine: Account Extras and Other Financial Products
Besides the EQ Bank’s Savings Plus Account, RSP, and TFSA account, EQ Bank does not offer any other kinds of personal accounts. However, as we mentioned earlier, they have a partnership deal with Transferwise, which gives customers a great deal on international money transfers.
With this deal, you can easily send money to many locations worldwide like the U.S., Asia, Europe, India, etc.. for a fraction of what it’d cost to send with traditional banks or money transfer services.
Despite being an online-only bank, Tangerine offers an impressive and wide array of products like you’d find with the traditional brick-and-mortar banks. Tangerine customers can enjoy home equity loans, mortgages, lines of credit, RSP loans, investment products, home equity loans, business accounts, and a lot more.
To top these, Tangerine has one of Canada’s best cashback no-fee credit cards.
Who’s the Winner? Tangerine Bank. Their wide array of financial and investment products competes with that of a traditional bank.
EQ Bank vs Tangerine: Account Safety
Both EQ Bank and Tangerine are insured by the Canada Deposit Insurance Corporation (CDIC). This means your deposits are completely insured up to $100,000 per account category(i.e. chequing account, savings account, TFSA account, GICs, etc.).
Who’s the Winner? For this feature, Tangerine Bank = EQ Bank. The two banks are members of the CDIC and provide safety for your funds.
EQ Bank vs Tangerine: Pros and cons
EQ Bank Pros
- Zero monthly fees.
- Free unlimited transactions
- Higher interest rates on GICs and savings.
- Cheap international money transfers.
- A limited array of financial products
- No ATM withdrawals
- No chequing accounts
- No monthly fees.
- They have an impressive array of financial products.
- New customers get a promotional rate in the first five months.
- Decent ATMs network.
- Up to $200 cash as a welcome bonus for chequing and savings accounts
- No international money transfer services.
- Lower interest rates on GICs and savings.
FAQs on EQ Bank vs Tangerine
Verdict: EQ Bank vs Tangerine
When choosing an online bank, the factors you’ll consider will depend on your expectations and needs. If you want an online bank that can handle all your day-to-day banking needs and give you a bit of physical presence, Tangerine Bank will do it for you.
However, if a higher interest rate on your money is your current focus, then EQ Bank would be your best bet.
Using an EQ Bank account combined with a Tangerine account is a great way to save on banking fees without sacrificing high-interest rates. EQ Bank offers higher interest rates on its HISA and GICs than Tangerine, which you can supplement with Tangerine’s free chequing account.
Therefore, using both accounts allows you to have the perks of a free chequing account with a savings account, as well as EQ Bank’s exciting GIC terms and rates.
If it comes down to choosing between the two banks, the higher interest rates usually win. However, it is always vital to put your essential needs into consideration.