Bank Fees in Canada: Check out the Most Common Ones

In Canada, bank fees can vary considerably between institutions and types of accounts. Understanding these costs is crucial for choosing the ideal bank and avoiding unpleasant surprises.

Because of this, in this article, we will show you the bank fees in Canada and how you can avoid paying these amounts by using resources that banks offer.

Follow the article to learn about bank fees in Canada.

What are the main bank fees in Canada?

In Canada, various bank fees can affect your pocket, from monthly fees to costs for international transactions. 

To help navigate this world of fees, we have separated the main fees for you to know.

Monthly Fee

In the Canadian financial world, the monthly fee, also known as an account maintenance fee, is a common cost charged by banks for your checking account.

This fee can significantly affect your budget, so understanding its details and how to minimize it is crucial for a healthy financial life in Canada.

The monthly fee is a charge applied monthly to your checking account. It represents one of the main sources of revenue for banks, covering the costs of maintaining the account and offering basic banking services.

The amount of the monthly fee varies considerably between Canadian banks and the type of account chosen. 

In general, it can range from $5 to $15, but it can be higher for accounts with more features or services included.

The monthly fee is usually debited from your account automatically at the beginning of each month. 

It is important to check your account statement to track charges and ensure that there is enough balance to cover the fee.

E-Transfer Fee

The e-transfer fee stands out as a common cost in various operations.

The e-transfer fee, also known as Electronic Transfer Fee (ETF) or Interac e-Transfer Fee, is a fee charged for electronic money transfers between bank accounts in Canada. 

This fee is usually applied when you send money to someone at a different bank from yours.

The amount of the e-transfer fee varies depending on the financial institution and the type of account. In general, it can be charged in two ways:

• Fixed fee: a fixed amount is charged for each transfer, regardless of the amount sent. This option is common in basic accounts or accounts with fewer features.
• Percentage fee: a percentage of the transferred amount is charged, with a predefined minimum amount. This option is more common in accounts with more benefits.

Overdraft Fee

The overdraft fee, also known as Non-Sufficient Funds (NSF) fee or returned check fee, is a fee charged when you try to use your checking account to make a transaction that exceeds the available balance.

This fee can be high and negatively impact your budget, so understanding it and how to avoid it is crucial for a healthy financial life in Canada.

The overdraft fee is a penalty charged when you try to make a withdrawal, payment, or transfer with your checking account and there is not enough balance to cover the transaction.

This fee aims to compensate the bank for the costs incurred in processing transactions with insufficient funds.

The amount of the overdraft fee varies among Canadian banks but is generally between $25 and $50 per declined transaction.

This fee can be charged for each returned check, ATM withdrawal with insufficient funds, or declined automatic debit.

Electronic Transfer Fee

The electronic transfer fee, also known as Electronic Transfer Fee (ETF) or Interac e-Transfer Fee, is a fee charged for money transfers between bank accounts in Canada.

This fee can affect your budget, especially if you make frequent transfers.

The electronic transfer fee is a fee charged when you send money to someone at a different bank from yours using the Interac e-Transfer system, a popular form of instant money transfer between Canadian bank accounts.

The amount of the electronic transfer fee varies depending on the financial institution and the type of account. It can be a fixed amount in the contract or a percentage of the transaction.

Statement Fee

The statement fee, also known as an account fee, is a fee charged by financial institutions to provide statements of your checking account.

This fee can affect your budget, especially if you request statements frequently.

The statement fee is a fee charged when you request a statement of your checking account, detailing your transactions, balance, and other financial information.

This fee aims to cover the bank’s costs in providing the statement, such as printing, sending, and processing.

The amount of the statement fee varies depending on the financial institution and the type of statement requested. 

In general, the types of statements and their respective fees can be:

• Printed Statement: a fixed amount is charged for each printed statement you request at the bank counter or receive at home by mail.
• Online Statement: a lower fee or even exemption may be applied for statements accessed online through the bank’s app or internet banking.
• ATM Statement: some banks may charge a fee for statements obtained at ATMs.

To get an idea of the amounts charged, here are some examples of statement fees at different Canadian banks: $2.00 per printed statement, $0.50 per online statement.

Other banks offer exemption for online statements, $1.50 per printed statement.

Is it possible to avoid bank fees?

Completely avoiding bank fees in Canada is a challenge, but with planning and smart strategies, you can significantly minimize them and achieve a healthier financial life.

Here are some ways to avoid bank fees in Canada:

Seek a free account

Finding a free bank account in Canada can be an excellent way to eliminate or minimize unnecessary fees. 

Several banks offer checking accounts with no monthly fees, transaction fees, or ATM withdrawal fees.

When looking for a free account, consider minimum balance requirements, as some accounts require you to maintain a minimum balance to avoid fees.

Also, check which services are included in the free account, such as debit card, electronic transfers, internet banking, and mobile banking.

Some free accounts may have limits on the number of transactions you can make per month or the total value of transactions. Evaluate if these limits fit your usage pattern.

Additionally, banks often offer promotions and bonuses for new customers opening free accounts. Take advantage of these opportunities to gain additional benefits.

Check contract details

Carefully reading the terms and conditions of your bank account is crucial to avoid unpleasant surprises and unexpected fees. The contract details all applicable fees, such as:

• Monthly Fee: make sure the account is really free or if there is a monthly fee charged in certain situations.
• Transaction Fees: identify fees charged for transactions such as ATM withdrawals, transfers, bill payments, and international debit card usage.
• Non-Sufficient Funds Fees: know how much you will be charged if your balance is insufficient to cover a transaction.
• Overdraft Fees: understand the fees and penalties related to overdraft usage.
• Other Fees: be aware of other fees that may be applied, such as statement fees, returned check fees, and account closure fees.

When reviewing the contract, clarify any doubts. Do not hesitate to contact the bank to clarify any doubts about the terms and conditions of your account.

Additionally, compare options from different banks to find the account that best suits your needs and offers the lowest fees.

If you are a customer with a good banking history, negotiate with your bank for lower fees or fee waivers.

Watch your balance

Regularly monitoring your bank balance is crucial to avoid unwanted fees and manage your finances responsibly. Here are some tips to help you:

• Check your balance frequently.
• Set up account alerts.
• Plan your transactions.
• Use overdraft cautiously.

By doing so, you avoid bank fees in Canada.

Be mindful of transaction limits

Many bank accounts in Canada have limits on the number of transactions you can make per month or the total value of transactions. Exceeding these limits may result in additional fees.

Access the bank app, internet banking, or printed statements to check the transaction limits of your account.

Track the number of transactions you make and the total transaction value to make sure you are not approaching the limits.

If you need to make a transaction that exceeds the limit, contact the bank in advance to request a temporary increase or seek alternatives, such as splitting the payment into smaller transactions.

With these tips, bank fees in Canada can be avoided, and you can get better conditions. See more tips like this on our page to help you!