Like other sectors in the business world, the banking sector is now following a customer-based approach to conduct business. Many Canadians are now doing away with their expensive bank accounts and switching to free banking options offered by online banks like Simplii vs Tangerine.
As digital banking is now becoming the norm, two of the best online banks in Canada that have emerged over recent years are Simplii vs Tangerine.
- Why Use an Online-Only Bank
- Overview: Simplii vs. Tangerine
- Simplii Financial Briefly
- Tangerine Briefly
- Simplii vs Tangerine: Account Options
- Simplii vs Tangerine: Investments
- Simplii vs Tangerine: Mortgages
- Simplii vs. Tangerine: Monthly Fees and Transactions
- Simplii Financial vs. Tangerine: ATMs and Branches
- Simplii vs. Tangerine: e-Transfers and Mobile App
- Tangerine vs Simplii: Cashback Credit Card
- Simplii vs Tangerine: Overall Pros and Cons
- FAQs on Simplii vs Tangerine
- Our Verdict: Simplii vs. Tangerine
But the question is which is a better option of the two? In this article, we’ll take a closer look at CIBC’s Simplii Financial and Scotiabank’s Tangerine and help you decide on which one you should go for.
Why Use an Online-Only Bank
You might wonder if online banking is worth it, especially since traditional banks have been serving Canadians well for decades. Well, before you decide, consider these four aspects where online banking in Canada supersedes traditional personal banking.
Online banking affords you convenience. You can access your account 24/7 from your mobile phone, computer, tablet, or mobile app. This means no more “banker’s hours” constraint. So if you want access to your money anytime and anywhere, an online bank is the way to go.
Online banks offer customers the option of a no-fee bank account with highly competitive rates and a high-interest savings account. Some traditional banks also offer customers low-fee accounts. However, they still come with a base monthly fee that can accumulate fast.
Canadians are said to be paying an average of $200 yearly in banking fees. So if you don’t want to be charged for accessing your own money, online banking might be the solution.
In addition to all the standard features you are used to, online banks also offer special features you won’t get elsewhere. Examples are Mobile Deposits and Interac e- Transfers.
You can’t go to a brick-and-mortar bank and ask the teller to send money via email or deposit a Cheque using a smartphone photograph. But these are part of the features you’ll enjoy with an online bank.
Online-only banks save money on costs associated with operating physical branches, and in return, they can invest that money in innovations and improve their service quality.
Overview: Simplii vs. Tangerine
|ATM Networks||CIBC (4,000 plus)||Scotiabank (3,300 plus)|
|Branches||None||Yes (Toronto, Montreal, Calgary, Vancouver)|
|Accounts||RRSP, TFSA, HISA, GIC||RRSP, TFSA, HISA, GIC|
|Cheques||Free||Free for the first 50, $20 subsequently|
|International Money Transfers||Free||Unavailable|
|Available in Quebec||No||Yes|
|Foreign currency orders||Yes (and $10 back on your first)||No|
Simplii Financial Briefly
Simplii Financial is an online-only bank and a subsidiary of CIBC. It was formerly called PC Financial, but since the end of the two decades partnership between CIBC and PC Financial in 2017, it came to be called Simplii Financial.
Simplii has zero physical presence. Customers conduct their banking operations through the website or by using the Simplii mobile app. You’ll also get free access to thousands of CIBC ATMs nationwide and the chance to speak with a customer service representative round the clock at 1-888-723-8881.
Simplii Financial has grown to become one of Canada’s most reliable and best online banks. Some of the benefits of a Simplii Financial account include:
- Zero monthly or annual fees.
- Unlimited transactions and Interac e-transfers.
- TFSA, RRSP, HISA, and GIC savings accounts available.
Tangerine Bank, formerly called ING Direct, is a subsidiary of Scotiabank who bought the direct bank in 2014. Tangerine is an online bank, but unlike Simplii, it offers some form of physical presence in the form of pop-up locations, cafes, and kiosks in the country’s major cities.
You can conduct your daily banking through their mobile app or their website. Also, you have free access to more than 3,000 Scotiabank ATMs and the chance to speak to a customer service representative 24/7 at 1-888-826-4374.
Tangerine has grown to become a leading Canadian bank, and these are some of the advantages of having an account with them:
- Zero monthly or annual fees.
- TFSA, RRSP, HISA, and GIC savings accounts.
- Unlimited transactions.
Simplii vs Tangerine: Account Options
Simplii Financial Accounts Offered
Simplii offers many financial products that cover an average bank client’s needs.
- High-Interest Savings Accounts (HISA)
Simplii’s HISA earns a 0.10% interest rate and a limited-time bonus rate during their occasional promotional offer. The account comes with no minimum balance requirement, zero monthly fees, and an automatic deposits feature. They also offer TFSA and RRSP savings accounts.
- No-Fee Chequing Account
The Simplii Financial No-Fee Chequing account has a lot of exciting features such as:
- Limitless free debit purchases, withdrawals, and bill payments.
- No monthly fees
- Up to 0.10% interest on your account balance
- Free Interac e-Transfer
- Free access to more than 3,400 ATMs in Canada
Simplii also offers mortgages, personal loans, line of credit, GICs, and Index mutual funds.
Tangerine Bank Accounts Offered
The financial products Tangerine Bank offers include:
- Savings Account
Tangerine offers different savings accounts based on your needs. The most popular one is the high-interest savings account because it offers one of the most competitive rates in Canada- currently 0.10%. The account comes with no monthly fees or minimum balance, plus you can save with zero stress using their Automatic Savings Program.
Other savings accounts available are:
- RRSP Savings Account
- Tax-Free Savings Account (TFSA)
- USD Savings Account
- RIF Savings Account
- Chequing Account
With the Tangerine No-Fee Daily Chequing Account, you’ll pay zero monthly fees on your Chequing account and even earn up to $200 in cash bonuses.
Other features of the account are:
- Unlimited free debits, email money transfers, bill payments, and pre-authorized payments
- No monthly fees
- Up to 0.10% interest on your account balance.
- Free access to 3,500 ATMs in Canada and 44,000 ATMs worldwide.
- Free first cheque book with fifty cheques.
Tangerine Bank also offers GICs, Mortgage, Home Equity Line of Credit (HELOC), and RRSP Loan.
How to Open an Account with Simplii vs Tangerine.
Opening an account works the same way for both banks. You’ll take these two steps:
Step 1. Sign up online. The online forms are simple, straightforward, and clear.
Step 2. Go to a Canada Post location and verify your identity. These are the three things you’ll need.
- A photo ID, e.g., passport, PR card, driver’s license.
- The DSS code/ barcode that was sent to your email.
- Evidence of your address, e.g., internet bill, hydro.
Simplii vs Tangerine: Investments
Both Simplii and Tangerine offer a fairly limited choice regarding real investments. Tangerine offers low-fee index funds that can be used for TFSA, RRSP, RRIF, and other non-registered investment portfolios.
They offer four choices which are a combination of index funds and balanced portfolios. The Management Expense Ratios (MERs) run at 1.07%, so they are not exactly low-cost but not super costly.
Simplii Financial, on the other hand, offers a much larger mutual fund selection through CIBC. Some of Simplii’s index funds have similar MERs to the Tangerine mutual fund portfolios, which is a little high compared to what some other banks offer. While Tangerine offers index portfolios as an all-in-one type of deal, Simplii offers stand-alone index portfolios or index funds.
Overall, the Tangerine mutual fund portfolio offerings might be basic, but it’s ideal for people with little or no investing experience or interest. Simplii Financial offers more options, but you’ll have to leave Simplii and deal directly with CIBC with the mutual fund investments.
Simplii Financial GICs
Simplii offers both non-registered and registered Guaranteed Investment Certificates (GICs), even traditional GICs and RRSP GICs.
Both the registered and non-registered GICs have the same rate. Simplii also provides GIC laddering options, allowing customers to diversify their investments at no risk. All GIC terms range between one to five years in term deposit length.
|GIC Term||Annual Interest Rates||Annual Percentage Yield (APY)|
Tangerine Bank GICs
Tangerine offers few investment options, including GICs. The term length ranges from ninety days to five years and includes different registered and non-registered GIC options.
Some investments include traditional GICs as well as RRSP GICs, TFSA GICs, and RRIF GICs.
All Tangerine GIC rates are listed in the table below.
|GIC Term||Current Interest Rates|
Simplii vs Tangerine: Mortgages
Getting the best mortgage deal possible is very important as a monthly mortgage payment is most people’s biggest expense. Both Simplii and Tangerine offer various ways to make extra payments that help you pay off your mortgage faster.
There is a significant difference in the type of mortgage they offer outside of their similar prepayment features.
Simplii offers Conventional Mortgages. A conventional mortgage means the amount you owe is what is registered against the property. For instance, if you bought a house for $350k, put down $100k, and took a mortgage for $250k, only the $250k is registered against the property.
On the other hand, Tangerine Bank offers only Collateral Mortgages. A collateral mortgage means the amount registered against the property could be the total amount of the property’s value. For instance, if you buy that same $350k house, put down $100k, and take out a mortgage for $250k, the amount registered against the property could be as much as $350k.
Tangerine offers this because it makes things easier if the person wants to refinance the property or borrow more money to take advantage of a rise in home equity.
Simplii vs. Tangerine: Monthly Fees and Transactions
Simplii Financial and Tangerine have good reasons for being two of the best online banks in Canada. Unlike many of Canada’s big banks, Tangerine and Simplii Financial both offer a customer-centered experience.
Their accounts will cost you nothing to own or use. Neither of the bank accounts requires monthly or annual fees or limits on how much you use your chequing or savings accounts.
Simplii Financial vs. Tangerine: ATMs and Branches
Since Simplii and Tangerine’s focus is on offering no-fee banking options, physical branches and face-to-face customer service are not available. If you conduct business at physical branches a lot, neither of these banks may be right for you.
However, Tangerine has few physical locations in major cities like Toronto, Vancouver, Calgary, and Montreal. So if you’ll like the option of a physical location to be on the table, then Tangerine might be the way.
Simplii Financial customers can conduct automated banking at CIBC ATMs, and Tangerine customers can withdraw from Scotiabank ATMs. If you’ll be withdrawing money frequently, going for the bank with more ATMs around places you frequent is your best bet.
Simplii vs. Tangerine: e-Transfers and Mobile App
The average cost of one Interac e-transfer is around $1.75, which can accumulate to become pretty expensive. But if you bank with Simplii or Tangerine, Interac e-transfers come at no cost. Simplii also offers Auto-Deposit registration, which automatically deposits any money sent to you straight into your chosen account.
Both banks have good mobile apps, so it’s a tie on that level.
Tangerine vs Simplii: Cashback Credit Card
Both Tangerine and Simplii Financial offer two of the best cashback credit cards in Canada to their customers. Tangerine Bank’s cashback credit card is called the Tangerine Money-Back Credit Card. These are some of its key features:
1. Zero annual fee
2. 2 % cashback from your two choices of ten cashback categories, including gas and groceries.
3. You’ll get a third category for the 2% cashback if you opt to have the cashback deposited into a Tangerine Savings Account rather than applying it directly to any outstanding balances.
4. 0.50% cashback on every other purchase.
5. The interest rate on cash advances and purchases is 19.95%
The Simplii Financial Cash Back Visa card also has no annual fees and offers great benefits worth checking. Here are some of its key features:
- No annual fee
- You can add up to three additional cardholders and set spending limits to earn cashback quicker.
- You earn 4% on eligible restaurant, coffee shop and bar purchases up to $5,000 per year.
- Earn 1.5 % on gas, groceries, drugstore purchases and pre-authorized payments, up to $15,000 yearly.
- Earn 0.5 % on every other credit card purchase.
Simplii vs Tangerine: Overall Pros and Cons
- No monthly fees or minimum balance requirements.
- Free Interac e-Transfers
- Unlimited withdrawals
- Up to $200 welcome bonus on new chequing accounts.
- A high 2% interest rate on savings accounts opened before March 31, 2021, and 0.10% subsequently.
- Worldwide money transfer and foreign currency services.
- Free access to over 3,400 CIBC ATMs across Canada.
- No physical branches.
- Simplii Financial is not available in Quebec.
- Interest rates on savings accounts are a little lower than other online banks.
- Zero monthly fees or minimum balance requirement.
- Unlimited withdrawals and free Interac e-Transfers.
- Physical locations in Toronto, Calgary, Montreal and Vancouver.
- Free access to over 3,500 Scotiabank ATMs across Canada.
- High-interest rates on GICs.
- $200 cash welcome bonus cash on chequing accounts.
- 2.1% promotional rate in the first five months on the savings account.
- No auto or personal loans.
- No international money transfers or foreign currency rates.
- Slightly lower interest rates on savings rates than other digital banks.
FAQs on Simplii vs Tangerine
Our Verdict: Simplii vs. Tangerine
Both Simplii Financial and Tangerine are exceptional choices for digital banking, and it is tough to pick one over the other. They both offer zero monthly fees, limitless transactions, and the ease of banking online or through your mobile device. However, each bank has its unique features that you may not find with the other.
For example, Tangerine does not offer foreign currency services, so if you want foreign currency services or international money transfers, Simplii is a better choice. If you stay in Quebec, Tangerine is available across Canada, including Quebec, and would be the better choice.
Ensure you carefully evaluate your needs to help you select which back matches what you are looking for more closely. And since they’re both completely free to use, there’s no reason you can’t get both accounts and use them for a different reason.