What is a high-interest savings account?

A high-interest savings account, or HISA, is a type of savings account that pays higher interest rates than a typical savings account. Most traditional banks, online banks, credit unions, and other financial institutions offer high-interest savings accounts as an account option, but interest rates will vary.

Some accounts will also have a promotional interest rate as a welcome bonus for the first couple of months after signing up, but then the rate may drop to something significantly lower. When choosing a high-interest savings account you want to keep an eye out for those promotional rates versus regular rates, as well as any conditions that the account may have in place.

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The best high-interest savings accounts of 2022

There is no shortage of high-interest savings accounts available to Canadians. This type of savings account is common and offered by most financial institutions. However, not all HISAs are made equal. These are our picks for the best high-interest savings accounts in Canada.

The best HISA with the highest rate: EQ Savings Plus

At the beginning of this article, I mentioned that some financial institutions offer great promotional rates on their HISAs, but then the regular interest rate is much lower. That’s not the case for EQ Bank, which currently has an interest rate of 1.50%.

EQ Bank is an online only bank and falls under Equitable Bank. As an online bank, it doesn’t have to worry about the same overhead costs as brick-and-mortar financial institutions so it’s able to pass those savings on to customers.

Not only does that mean having the best non-promotional interest rate in Canada right now, but it also means that the EQ Savings Plus account also has plenty of other advantages. Or, rather, very few conditions.

It has no monthly fees and no minimum balance. Account holders can also take advantage of unlimited transactions and free electronic fund transfers, mobile cheque deposits, and bill payments. Unlimited free Interac e-Transfers are also included.

There is, however, a maximum balance that your account can hold, which is $200,000. Interest is calculated daily and paid monthly into your account.

This combination of a high interest rate and limited conditions makes EQ Bank one of the top recommended best high-interest savings accounts in Canada.

EQ Bank Summary

  • Regular interest rate: 1.50%
  • Promotional interest rate: None currently
  • Minimum account balance: None

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The best no-fee HISA account: KOHO

KOHO isn’t just another banking platform. It’s actually a Canadian financial technology company that has become incredibly popular among Canadians since its launch in 2017, thanks to higher interest rates and low fees/limited conditions.

KOHO is a free downloadable app that allows Canadians to earn 1.20% interest on their savings, as well as their spending.

How does it work? The KOHO app integrates with a pre-paid Visa card that allows you to budget, spend, and save at the same time. Once you have opened the account and chosen the Visa card (which, since it’s prepaid, works more like a debit card) you can deposit money onto the card from your bank account using an e-transfer.

You can even directly load some, or all, of your paycheque to your KOHO Card. Once direct deposit is set up, you will start to earn 1.20% interest. You can use your KOHO card to pay for pretty much everything from your morning coffee to your monthly bills. Plus, when you use your KOHO to make a purchase, you’ll earn an additional 0.5% cash back.

KOHO has no monthly fees and does not charge for Interac e-Transfers, electronic fund transfers for your bank, or ATM withdrawals (within the KOHO ATM network). Additional perks include an easy to use app with plenty of budgeting tools, and the ability to set up automated savings.

KOHO isn’t a traditional HISA but the high interest rates, no fees, and additional benefits make it worthy of a spot on this list of the best high interest savings accounts in Canada.

KOHO Summary

  • Regular interest rate: 1.2%
  • Promotional interest rate: None currently
  • Minimum account balance: None

The best HISA at a Big Six bank: TD e-Premium Savings Account

When it comes to high-interest savings accounts at big banks, the interest rates tend to be significantly lower than those offered by online banks. This is due in part to the overhead costs that Canada’s brick-and-mortar banks have.

That being said, there are many people who still prefer Canada’s big banks to the new online ones. The big six banks are well-known and trusted, and that goes a long way when it comes to personal finances.

So, if you are looking for the best HISA at a big bank, then consider the TD e-Premium Savings Account, which offers 0.50% interest on balances over $10,000. There is no monthly fee and you have unlimited online transfers.However, other fees associated with this account include the following:

  • Transaction fee: $5.00 per transaction
  • Non-TD ATM Fee (in Canada): $2.00
  • Foreign ATM Fee (U.S./Mexico): $3.00 each

Given the large minimum balance, as well as the associated fees for some transactions, it’s best to keep this account strictly as a savings account to avoid any additional costs.

  • Regular interest rate: 0.50%
  • Promotional interest rate: None currently
  • Minimum account balance: $10,000

The best HISA at a credit union or caisse populaire: Maxa Financial

Maxa is an online division of Westoba credit union, which is located in Manitoba. However, their financial products are available to Canadians across the country. Maxa Financial doesn’t offer a ton of banking products, but their high interest rates are on the high end at 1.60% for standard, non-promotional rates.

To join Maxa Financial you will need to purchase a $5 share, but there is no minimum balance requirement and no monthly fees. However, account holders do need to be wary of other fees and transactional costs associated with their Maxa account. These include the following:

Debits (including cheques, pre-authorized debits, bill payments, ATM withdrawals etc.) — one free per month and then $1.50 per additional debit.

  • $1.50 to send and request an e-transfer
  • $7.50 to cancel an e-transfer
  • $3.00 for team assisted transfer (not for investments)
  • $3.00 for team assisted bill payments

The high interest rate makes Maxa Financial a great option if you are looking for a HISA at a credit union available across the country. However, you’ll want to keep this account strictly as a savings account to avoid any fees, as those have the potential to rack up quite quickly.

Maxa Financial Summary

  • Regular interest rate: 1.60%
  • Promotional interest rate: None currently
  • Minimum account balance: None, but you need to make a $5 share purchase to access Maxa Financial products.

Best tiered-interest HISA account: Scotiabank’s Momentum Plus Savings Account

Some high-interest savings accounts will offer you different rates based on the amount of money you have in the account and/or how long you keep it in the account for.

These types of HISAs with differing levels of interest rates are called tiered-interest accounts.

When it comes to tiered-interest HISA accounts, look to Scotiabank’s Momentum Plus Savings Account. With this type of account, the longer you leave your savings untouched, the more it will earn. The starting rate is 0.35% but that increases up to 1% if you leave your deposit untouched for at least 360 days.

Plus, Scotiabank Momentum Plus accounts frequently have promotional rates for new clients. From now until August 31, 2022 you can earn an extra 2.95% in bonus interest. If you are already a client at Scotiabank and hold a specific account package, you can also be eligible for an additional bonus interest rate added on top of this.

Again, since it’s a big bank, the Scotiabank Momentum Plus doesn’t necessarily offer the best rates when it comes to HISAs. But their tiered interest strategy is certainly appealing to some clients looking to save money and earn some interest.

Scotiabank Momentum Plus Summary

  • Regular interest rate: 0.35%, then 0.85% for 90 days; 0.90% for 180 days; 0.95% for 270 days; and 1% for 360 days.
  • Promotional interest rate: 2.95% bonus interest (for eligible deposits until August 31, 2022)
  • Minimum account balance: None

Runner-Up: Neo Financial

Neo Financial didn’t make our list of the best high-interest savings accounts in Canada, at least not yet, but we believe it’s worth keeping an eye on and deserving of a runner-up mention.

Neo Financial is relatively new to Canada’s financial scene. This startup fintech company was founded in 2019 and is catching attention with its cash back credit card and savings account.

Neo Financial's savings account, called Neo Money, isn’t a typical HISA, in the sense that other financial institutions separate their HISAs from other savings accounts. The Neo Financial savings account is the only savings account option and it comes with some pretty impressive features including an interest rate of 2.25%, free transactions, and no minimum deposit requirements.

While the Neo Financial HISA has a great rate, the others on this list do have some more perks and benefits, especially if you’re looking to do multiple types of banking on a single platform.

Neo Financial is still pretty new to the market so there is lots of potential to grow. That said, it could still be an excellent choice right now depending on your wants and needs. If you are just looking for a basic account with a good interest rate, it’s worth considering.

Neo Financial Summary

  • Regular interest rate: 2.25%
  • Promotional interest rate: None currently
  • Minimum account balance: None

Honourable Mention: Simplii Financial

Another HISA worth mentioning is Simplii Financial. They didn’t quite make the list of our best high-interest savings accounts in Canada but they still could be a good pick for you if the timing is right.

While the normal interest rate for Simplii Financial’s HISA isn’t the most impressive at 0.10%, this financial institution is known for having some great promotional rates. Again, promotional rates aren’t good for long term savings options but if you are only saving up money for a couple of months before you are planning on making a large purchase, then the promotional rate can be worth taking advantage of.

At the time this article was written, Simplii Financial is running a promotional rate of 3.00%. That’s double EQ bank’s rate which can add up pretty quickly if you are looking for a place to park your money for a few months.

Like many of the other options on this list, Simplii Financial's HISA has no minimum balance requirement and no monthly or transaction fees. So keep an eye out for those promotional rates and take advantage if the timing is right.

Simplii Financial Summary

  • Regular interest rate: 0.10%
  • Promotional interest rate: 3.00% with limits, until October 31, 2022
  • Minimum account balance: None

How is a high-interest savings account different from regular savings accounts?

While they offer better interest rates than a regular savings account, HISAs also tend to come with more restrictions or conditions.

Some common conditions to look for when choosing a high-interest savings account include account minimums. For example, interest might only be calculated if your account has a minimum balance, such as $5,000.

There are also withdrawal conditions, where there are a limited number of free withdrawals per month and you get charged if you exceed the limit. There are also transaction fees, which may be waived depending on your balance. Again, any conditions and fees associated with your HISA will vary from institution to institution.

Savings account options from the big bank

Despite not making our best-of list, it’s worth taking a look at what the other Big 5 banks offer for HISAs.

CIBC eAdvantage Savings Account

CIBC offers a 0.35% interest rate with their eAdvantage Savings Account. When you contribute at least $200 a month (to a maximum of $200,000) you receive an additional 0.25%. As of this writing, they’re also offering 2.00% bonus interest for the first 4 months.

There’s no fee for the account, but each transaction comes at a cost of $5.

CIBC eAdvantage Savings Account Summary

  • Regular interest rate: 0.35%
  • Promotional interest rate: 2.00% (limits apply)
  • Minimum account balance: $0

BMO Savings Builder Account

The BMO savings builder account is a free account that provides a base interest rate of 0.10%, with a bonus interest rate of 0.60%. To qualify for the bonus interest rate, you must deposit $200 per month into the account.

You receive one free transfer out of the account per month, but after that each transaction will cost you $5.

BMO Savings Builder Account Summary

  • Regular interest rate: 0.10%
  • Bonus interest rate: 0.60% if invest $200/mth
  • Minimum account balance: None

Royal Bank High Interest eSavings Account

RBC offers a HISA with a standard interest rate of 0.50%. Until August 31, 2022, if you open an account you will receive a promotional rate of 2.50% for three months. There is no monthly fee, and you can transfer money from the HISA to another RBC account in your name for free.

Included in the account is 1 free RBC ATM withdrawal per month. Additional transactions cost $5 per month.

RBC High Interest eSavings Account Summary

  • Regular interest rate: 0.50%
  • Promotional interest rate: 2.50% for 3 months
  • Minimum account balance: None

Best high-interest chequing account: Tangerine No-Fee Daily Chequing Account

High-interest savings accounts are common but high interest chequing accounts are pretty rare in Canada. Most banks would scoff at the idea of clients earning any interest at all on their chequing account — it’s just not a product that banks want to offer.

However, online bank Tangerine has challenged that tradition.

Tangerine is an online bank known for their low fees and free accounts. One of those accounts is the Tangerine No-Fee Daily Chequing Account, which allows for free daily transactions and pays you interest on every dollar in the account. The interest rate is quite small. You’ll earn interest at a rate of 0.01% to 0.10% depending on your balance.

As a no-fee account, the Tangerine No-Fee Daily Chequing account also includes unlimited debit purchases, bill payments, and pre-authorized payments. You also have free and unlimited email money transfers and Interac e-Transfer transactions.

Tangerine is linked to Scotiabank ABMs, of which there are 3,500 across Canada and 44,000 worldwide through the Scotiabank Global ATM Alliance.

The interest rate may not be that high, but remember, a typical chequing account will not earn you any interest these days.

Tangerine No-Fee Daily Chequing Account Summary

  • Regular interest rate: 0.01% for balances up to $49,999.99; 0.05% for balances from $50,000 to $99,999.99; and 0.10% for balances of $100,000 or more.
  • Promotional rate: none
  • Minimum account balance: none

Put your cash in the right place

One of Canada’s highest-earning savings accounts, EQ Bank, will earn 1.50% interest on every dollar you save. That’s 150 times better than a chequing account with a 0.01% annual percentage yield (APY).

Let’s say you use your savings to create an emergency fund, which experts say should cover at least six months’ worth of your regular expenses.

If you put $9,000 — enough to cover $1,500 a month for six months — into a high-interest account at 1.50%, you’ll earn $135 in interest over the course of a year. And if you leave it in a regular chequing account at 0.01%? You’ll make less than a dollar. Don't let your cash stagnate and try a high-interest savings account today.

About the Author

Hannah Logan

Hannah Logan

Freelance Contributor

Hannah Logan is an Ottawa-based writer and blogger who specializes in personal finance and travel.

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