What is a low-cost bank account in Canada?
It is an account costing no more than $4 a month, with at least 18 debit transactions, that 14 banks offer under a federal commitment. The no-cost version waives the fee for youth 18 and under, students, GIS seniors, RDSP beneficiaries and newcomers in their first year, with proof of eligibility. The modernized commitment took effect December 1, 2025.
What a low-cost account must include
- A monthly fee of no more than $4.00.
- At least 18 debit transactions a month: at least 12 from core types (debit purchases, bill payments, pre-authorized debits, cheques, cash withdrawals, electronic transfers such as Interac e-Transfer, in-branch transactions) plus 6 more from the same list or others such as online debit purchases and account transfers. That is up to 50% more than the previous 12.
- Free digital monthly statements.
- Cheque-writing where the bank offers it to other retail customers.
- No minimum balance, no extra charge for deposits, debit cards or pre-authorized payment forms, and no switching fee to move to it at the same bank.
- Joint accounts where warranted.
Who gets it free: the no-cost account
The same account with the fee waived, subject to proof of eligibility and periodic re-validation. Every signatory must offer it to:
Youth
18 and under.
Students
With proof of enrolment.
Seniors receiving the GIS
Guaranteed Income Supplement recipients.
RDSP beneficiaries
Registered Disability Savings Plan beneficiaries.
Newcomers
In their first year in Canada — a new mandatory group since December 1, 2025.
Plus one optional group
Each bank also chooses at least one: Indigenous peoples, recipients of select provincial or territorial social assistance, or Disability Tax Credit recipients.
Which banks offer it
FCAC lists 14 signatories: Alterna Bank, Bank of China (Canada), BMO, CIBC, Hana Bank Canada, ICICI Bank, Industrial and Commercial Bank of China, Innovation Federal Credit Union, Laurentian Bank, National Bank, Royal Bank of Canada, Scotiabank, Tangerine Bank and TD Bank. Credit unions are not part of the federal commitment, though many offer their own basic accounts.
Will 18 transactions be enough?
Count a typical month: every tap, bill payment, automatic withdrawal and e-Transfer. If you regularly exceed 18, a low-cost account may cost more once per-transaction fees are added. Compare plans in the account-fee calculator.
Worked example · computed by the fee calculator
Illustrative inputs: $15/month fee, waived at $4,000; usual balance $1,500; 1 month below the minimum; 3.0% alternative rate; 30% tax.
| Option | Cost per year |
|---|---|
| Pay the monthly fee | $180.00 |
| Keep the minimum balance | $67.50 |
| Switch to a no-monthly-fee account | $24.00 |
Break-even rate: 9.43%. Run your own numbers →
How do I ask for a low-cost or no-cost account?
- Pick a signatory bank
Only the 14 banks listed above are part of the federal commitment. - Ask for it by name
Ask for the low-cost account or no-cost account under the Commitment on Low-Cost and No-Cost Accounts. Signatories must display information about these accounts prominently in branches and online, list them with their other accounts, and train staff about them. - Bring proof for the no-cost version
You show documents when you open the account, and the bank may re-check eligibility from time to time. FCAC gives examples for some groups: for Indigenous peoples, a Secure Certificate of Indian Status or Certificate of Indian Status, a letter from an Indigenous community organization, or proof of membership in a Métis organization or an Inuit land claim organization; for the Disability Tax Credit group, a DTC certificate. Ask the bank what it accepts for the other groups. - Ask about a linked savings account
Banks must tell you about interest-bearing savings options that can be linked to these accounts.
Worked example: are 18 transactions enough?
An illustration with round numbers. Count a typical month:
| Transaction | Per month |
|---|---|
| Debit card purchases | 9 |
| Bill payments | 3 |
| Pre-authorized debits (phone, insurance) | 2 |
| Interac e-Transfers sent | 2 |
| ATM withdrawals | 2 |
| Total | 18 |
That fits. Now add three more coffee taps a week — about 12 more a month, or 30 in total. If the bank charged $1 for each extra transaction (an illustrative number, not any bank’s fee), you would pay $12 on top of the $4 monthly fee: $16 for the month. At that point a plan with more transactions might cost less. Check real fees in the true-cost finder or compare accounts.
Is a low-cost account right for me?
| If you… | Then a low-cost or no-cost account… |
|---|---|
| Make 18 or fewer debit transactions a month | Is likely a good fit |
| Are 18 or under, a student, a senior on the GIS, an RDSP beneficiary or in your first year in Canada | Can be free at every signatory |
| Write cheques or bank in person often | Still works: cheques and in-branch transactions are core types that count toward the 18 |
| Make many transactions every month | May cost more than a plan with more transactions |
| Bank only at a credit union or a non-signatory online bank | Isn’t covered by the commitment — compare their own basic accounts |
Your basic rights at any bank
- You have the right to open a personal account if you meet certain conditions, including acceptable ID. If a bank refuses, it must tell you in writing and give you its complaint procedure plus OBSI and FCAC contact details.
- Your bank must tell you in writing at least 30 days before a new or higher charge takes effect.
- Banks must refund fees that weren’t properly disclosed or that you didn’t expressly consent to.
- You can cash a Government of Canada cheque of up to $1,750 free at any bank, even if you’re not a customer, with acceptable ID.
Common mistakes
- Asking for a “free account” instead of naming the low-cost or no-cost account under the commitment.
- Ignoring a request to re-confirm eligibility, such as proof you’re still a student. You could lose the fee waiver.
- Assuming every bank covers the same optional group. Each signatory picks at least one: Indigenous peoples, recipients of select provincial or territorial social assistance, or Disability Tax Credit recipients.
- Forgetting to count automatic payments when you tally your transactions.
What if a bank won’t give me one?
Use the bank’s complaint process and write down the date. The bank has 56 days to respond, and then you can go to OBSI for free. You can also tell FCAC, which supervises banks’ compliance with public commitments like this one. See how to make a bank complaint.
Related fee protections
Since March 12, 2026, federally regulated banks may charge no more than $10 for a non-sufficient-funds (NSF) fee on personal deposit accounts, can’t charge one when the shortfall is under $10, and can’t charge more than one per account within two business days. More in bank fees in Canada.
Banks don’t always advertise these accounts on their home page. Ask for the low-cost account by name.
What this means for you
If your banking is simple, or you belong to an eligible group, this account can cut your fees to $4 a month or to nothing. Here is how to act on it.
- Check whether you qualify for no-cost
Youth 18 and under, students, seniors receiving the GIS, RDSP beneficiaries and newcomers in their first year qualify at every signatory. Indigenous peoples, select social-assistance recipients and Disability Tax Credit recipients qualify only where the bank has chosen that group, so ask. - Count your transactions
Tally a typical month, including automatic payments. At 18 or fewer, the account is likely a good fit; well above that, per-transaction charges may make another plan cheaper. The account-fee calculator shows the difference. - Ask for it by name
At one of the 14 signatory banks, ask for the low-cost or no-cost account under the federal commitment, bring proof of eligibility, and ask about a linked interest-bearing savings account. - Keep the waiver
Respond when the bank asks you to re-confirm eligibility, such as proof you are still a student.
If you already bank at a signatory, moving to its low-cost account carries no switching fee. If you bank at a credit union other than Innovation, the commitment doesn’t apply, so compare its own basic accounts in the true-cost finder. If a signatory won’t open one for you, use its complaint process, then OBSI, and tell FCAC.
Frequently asked questions
What is the maximum fee for a low-cost bank account?
$4.00 a month at the 14 signatory banks, under the commitment in force since December 1, 2025.
How many transactions does a low-cost account include?
At least 18 debit transactions a month, at least 12 of them from core transaction types.
Can newcomers get a free bank account?
Yes. Newcomers in their first year in Canada are a mandatory no-cost group at signatory banks since December 1, 2025.
Do credit unions offer the low-cost account?
The federal commitment covers its 14 signatories, including one federal credit union (Innovation). Other credit unions may offer their own low-fee accounts.
What ID do I need for a no-cost account?
You show proof of eligibility when you open it. FCAC lists examples for Indigenous peoples and Disability Tax Credit recipients; ask the bank what it accepts for youth, students, GIS seniors, RDSP beneficiaries and newcomers.
Will I have to prove eligibility again?
Possibly. FCAC says banks may re-validate continued eligibility periodically.
Do banks have to tell me about low-cost accounts?
Signatories must display information about low-cost and no-cost accounts prominently in branches and online, and train their staff about them.
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