BMO’s high-interest savings rate is one of the most competitive among Canadian big banks.
That said, you won’t earn much on your deposit, and after accounting for inflation, chances are that you are losing purchasing power over time.
A high interest savings account is very similar to regular savings with the additional benefits of higher rates and a chance to grow your money faster.
This review of BMO’s high-interest savings accounts (HISA) covers their features, savings account rates, fees, and alternatives.
BMO High Interest Savings Account
BMO offers several savings accounts, including;
- BMO Savings Builder Account: This HISA offers a tiered interest rate of up to 2.50% when you meet the eligibility requirements.
- BMO Savings Amplifier Account: This account pays a 1.90% interest on your balance.
- BMO Premium Rate Savings Account: You earn up to 0.01% and can share transaction limits with your chequing plan.
- BMO U.S. Dollar Premium Rate Savings: This account pays 0.05% interest on your USD savings.
BMO Savings Builder Account
The BMO Savings Builder Account rewards active savers with monthly bonus interest if they increase their account balance by $200 or more.
You earn:
- 0.50% base interest rate, plus
- 2.00% bonus interest when your savings balance increases by at least $200.
The bonus interest applies to balances of up to $250,000.
The Savings Builder account has no monthly fees; however, you pay a $5 fee for each withdrawal or transfer out.
One free transfer out per month is included in the plan, but it does not support bill payments or Interac e-Transfers.
Bank of Montreal Overview
The Bank of Montreal (BMO) was founded over 200 years ago in 1817. It is one of the top-5 banks in Canada based on assets and market capitalization.
BMO has more than 12 million customers and 40,000 employees.
Its stock trades on the Toronto Stock Exchange under the ticker symbol “BMO.”
BMO High Interest Savings Account Alternatives
For savings rates better than what the BMO Savings Builder account offers, you can consider the following options.
EQ Bank Savings Plus
EQ Bank Personal Account
Up to 4.00%* interest rate
Unlimited debits and bill payments
Unlimited Interac e-Transfers
No monthly account fees
The EQ Bank Personal Account offers one of Canada’s best high-interest savings rates. This hybrid account has both chequing and savings account features, including:
- Free mobile cheque deposits
- Free unlimited bill payments and electronic fund transfers
- Free unlimited Interac e-Transfers
- Eligibility for Canada Deposit Insurance Corporation (CDIC) protection up to $100,000 per insured category
Interest earned is calculated daily on your closing balance, and it is paid out monthly.
EQ Bank’s savings plus account has no monthly fees and no minimum balance requirement.
Neo Financial
Neo Savings Account
4.00% non-promo interest rate
No monthly fees
Unlimited free transactions
Access to a no-annual-fee credit card
Neo Financial pays a 4.00% interest rate on your balance.
In addition to this high-interest savings rate, Neo users also enjoy access to the following perks:
- Budgeting app
- Free Interac e-Transfers and bill payments via a free Neo Money account
- CDIC protection
- Automatic savings
- Up to 5% cash back on purchases when you pay with your Neo Money card
Best High Interest Savings Accounts in Canada (BMO vs. EQ Bank vs. Neo)
| BMO Savings Builder Account | EQ Bank Personal Account | Neo Financial | |
| Interest rate | Up to 2.50% | Up to 4.00% | 4.00% |
| Monthly account fee | $0 | $0 | $0 |
| Number of free transactions/month | 1 free transfer out | Unlimited free transactions | Unlimited free transactions via Neo Money |
| Free Interac e-Transfers | N/A | Unlimited free Interac e-Transfers | Unlimited free Interac e-Transfers via Neo Money |
| Extra fees/transaction | $5 | $0 | $0 |
| CDIC insurance | Yes | Yes | Yes |
| Other features | N/A | Access to cheap international money transfer; free mobile cheque deposits; free ATM withdrawals | Access to a cash back card |
| Learn more | Read review | Visit EQ Bank | Visit Neo |
Pros and Cons of a BMO High Interest Savings Account
The benefits and downsides of a BMO high interest savings account include the following:
Pros:
- Higher interest rates: You earn higher interest rates than a regular BMO savings account.
- Security: Your deposits are insured by the Canadian Deposit Insurance Corporation (CDIC) up to $100,000. BMO is also one of the largest and oldest banks in North America.
- Flexibility: Savings accounts are designed to be easily accessible, allowing you to deposit and withdraw funds at any time.
- Automated savings: You can set up automatic transfers from your chequing account to your savings account, making it easier to save money regularly.
Cons:
- Limited transactions: Savings accounts may come with transaction limits, meaning you may be charged fees for exceeding a certain number of withdrawals or transferring funds to another bank.
- Lower interest rates: While BMO HISAs offer higher interest rates than their regular savings accounts, the interest rates may be lower than other online banks.
- Fees: Fees may apply to pre-authorized debits, cash withdrawals, and transfers made in the branch or through telephone support.
- Inflation risk: While your money earns interest in a savings account, the inflation rate may outpace your interest earnings, meaning your purchasing power could decrease over time.
How To Open a BMO Savings Account
If you’re interested in opening a BMO savings account, you have a few options. One way is to visit a BMO branch in-person, where you can speak to a customer service representative who will guide you through the account opening process. Alternatively, you can apply online through BMO’s website or call their customer service line to open an account over the phone.
Regardless of which option you choose, you’ll need to provide some personal identification, such as a driver’s license or passport. You may also need to provide additional documentation, such as your SIN and proof of address, if your government-issued ID does not have this information.
What is a High Interest Savings Account?
A high interest savings account in Canada is an excellent way to grow your deposits in a low-risk account. Also known as HISAs, these accounts, offered by banks, credit unions, and online-only banks, offer a higher interest rate than a standard savings account, allowing your money to earn more over time.
The interest rate on a high interest savings account varies depending on the financial institution, account features, and current market conditions. And they are insured by the Canada Deposit Insurance Corporation (CDIC) up to $100,000 per depositor per institution.
High interest savings accounts are also designed to be easily accessible. You can usually deposit and withdraw money from these accounts at any time without penalty, which makes them a great option for Canadians who want to keep their savings liquid and readily available.
It’s important to note that some high interest savings accounts may come with fees or restrictions, such as minimum balance requirements, transaction limits, or a fee when used for pre-authorized transactions or ATM deposits.
Savings Account vs Chequing Account
A savings account is designed to help you save money over time. These accounts typically offer a higher interest rate than chequing accounts, allowing you to earn interest on the money you deposit. While savings accounts are generally accessible, some have restrictions, such as transaction limits or minimum balance requirements.
On the other hand, a chequing account is designed for everyday transactions such as paying bills, making purchases, and withdrawing cash at ATMs. These accounts usually offer zero or very low interest rates, but they are more flexible and can be used for a wider range of transactions. Chequing accounts may also come with additional features such as overdraft protection and debit card access.
It’s also important to compare the fees and charges associated with each type of account. Canadian banks generally charge monthly maintenance fees for chequing accounts, although, they may waive this fee under certain conditions, such as a minimum balance.
That said, you can open no-fee chequing accounts with unlimited transactions at online banks like Simplii Financial.
BMO HISA FAQs
BMO’s best savings account rate is offered by its Savings Builder account for active savers.
As of January 2024, the best interest rate on the BMO Savings Builder account is up to 2.50%.
The rates on savings accounts change all the time, and a bank offering the best rate today may not be as competitive tomorrow. The best savings rates are usually from online banks and may exceed 3%.
Assuming the bank is offering 0.50%, you will get approximately $5.00 after one year. At a 1.50% interest rate, you get approximately $15.00 in return after one year.
How about other big banks?
I have reviewed the high-interest savings accounts for other big banks below:
