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Best High-Interest Savings Accounts in Canada: Earn Up to 2.85%

Canadians can earn significantly more interest on their cash savings by switching from major banks to smaller alternative lenders, with rates as high as 2.85% compared to the 0.30% to 0.60% typical of big banks.

April 21, 20263 min read

Stop Leaving Money on the Table: High-Interest Savings Accounts Pay Up to 2.85%

The Bottom Line: If you keep your savings at a major bank like TD, Scotiabank, or CIBC, you are likely earning less than 1% interest. By moving your money to an alternative lender, you could earn up to 2.85%. On a $10,000 emergency fund, that is the difference between earning $30 and earning $285 in a year.

Here is what you need to know about getting a better return on your cash.

The Big Gap: Big Banks vs. Alternatives

There is a massive difference in the interest rates offered by traditional banks compared to digital alternatives and credit unions.

  • Major Banks: Typically offer 0.30% to 0.60%.
  • Alternative Lenders: Currently offering up to 2.85%.

Current Top Rates (as of latest data)

  • Saven Financial: 2.85%
  • Oaken Financial: 2.80%
  • EQ Bank: 2.75%
  • PC Financial: 2.90% (Promotional rate for the first year)

Watch Out for "Teaser" Rates

Some major banks offer high rates that look great but disappear quickly.

  • Scotiabank and CIBC are offering short-term rates between 4.50% and 4.70%.
  • The Catch: These rates usually last only 3 to 5 months. After that period ends, the rate drops back down to the standard low rate (often below 1%).

Who is Affected?

This affects anyone who keeps cash in a standard savings account or a "high-interest" account at a major bank.

  • Emergency Funds: Money you keep for a rainy day.
  • Short-term Savings: Money saved for a down payment, a car, or a vacation within the next few years.
  • Idle Cash: Money sitting in a checking account that isn't needed for monthly bills.

What You Should Do

If you want to stop losing money to inflation and low interest rates, follow these steps:

  1. Check your current rate: Log in to your current bank account and find the interest rate on your savings. If it is below 2.00%, you should move it.
  2. Check the requirements: Some high rates have conditions.
    • EQ Bank: Requires a $2,000 monthly direct deposit to get their top rate.
    • Scotiabank: Often requires a very high minimum balance (sometimes $500,000) to get their best tiered rate.
  3. Open an alternative account: Institutions like Saven, Oaken, and EQ Bank are often digital-only. Opening an account usually takes less than 15 minutes online.
  4. Transfer your funds: Link your new account to your existing bank account and transfer your savings over.
  5. Verify insurance: Make sure your new institution is a member of the CDIC (Canada Deposit Insurance Corporation) or a provincial insurer. This protects your money (up to $100,000 per eligible category) if the bank fails.

Bottom Line

Do not let your savings stagnate. Major banks are paying very little interest right now. By switching to an alternative lender like Saven (2.85%) or Oaken (2.80%), you can earn nearly ten times more interest with very little risk. Just be sure to read the fine print regarding monthly fees or direct deposit requirements.

Source: WOWA.ca Savings Account Interest Rates

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