EQ Bank vs. Tangerine Bank 2022: How Do They Compare?

Photo of author

by Enoch Omololu

Updated

Advertiser Disclosure

EQ Bank and Tangerine are two of the most popular online-only banks in Canada.

More Canadians are choosing to go digital with their banking, with recent stats showing that more than three-quarters of Canadians now use online and mobile interfaces for conducting their banking transactions.

This increasing adoption of online banking is a boon to relatively newer entrants into the banking industry i.e. online banks.

Not many people like to pay the ever-increasing banking fees charged by traditional brick-and-mortar banks. Forget about ATM fees, NSF, overdraft, account transfer, transaction fees, and so on. What usually irks me is the monthly chequing account maintenance fees.

I am simply unable to rationalize paying to keep money in my account when the bank is already making money off of it. Canadians pay in excess of $200 per year on average in banking fees!

Online-only banks come with their own pros and cons.

One differentiating feature between them and traditional banks is that they usually offer a no-fee, no-minimum balance chequing account and/or a high-interest savings account. They also offer very little in the way of in-person assistance.

Some of the major online-only banks present in Canada today include EQ BankTangerineWealthsimple, and Simplii Financial.

In this post, I compare EQ Bank vs Tangerine including their financial products, fees, pros, cons, and everything else you need to make an informed choice.

What is Tangerine Bank?

Tangerine is a subsidiary of Scotiabank and was formerly known as ING DIRECT.

It does not have branches, however, in addition to having access to a 24/7 call centre, you can walk into the few Tangerine pop-up locations and cafes around the country if you must speak to someone in person.

As a customer, you also have access to over 44,000 ATMs around the world through Scotiabank’s Global ATM Alliance.

Tangerine Bank offers a suite of financial products including:

1) Savings: Multiple savings accounts are provided for personal and business clients.

2) GICs: Tangerine GICs are available with terms ranging from 90 days to 5 years. You can hold these GICs in both registered and non-registered accounts

3) Spending: A no-Fee Chequing Account and Tangerine 2% Money-Back Credit Card that’s one of the best cash back credit cards in Canada.

4) Investing: You can hold Tangerine Investment Funds in TFSA, RRSP, RRIF, and non-registered investment accounts.

5) Borrowing: Mortgage, HELOC, and RRSP Loans are available.

The general features you can expect on Tangerine’s chequing account include:

  • Zero monthly bank fees
  • Interest earned on chequing account balance (up to 0.10%)
  • Free and unlimited debit transactions, bill payments, and pre-authorized payments.
  • No minimum account balance
  • Automated Savings Program
  • Free mobile cheque deposits

What is EQ Bank?

EQ Bank is the online-only arm of Equitable bank – a Schedule I bank with total assets of approximately $42 billion.

The bank operates strictly online and they have no brick-and-mortar branches you can walk into. It is the overhead saved from not having to pay for building and other maintenance costs that they pass on to customers through higher savings interest rates.

Although it is without a physical location, you can always reach someone to talk to via phone or chat if you have any questions.

EQ Bank offers customers a high-interest savings account (known as Savings Plus Account) and GICs. Features of its savings and GIC account offerings include:

  • No monthly fees
  • No minimum balance
  • High-interest savings rates (1.50%*)
  • Free unlimited electronic fund transfer
  • Unlimited bill payments
  • Unlimited FREE Interac e-transfers per month
  • Free mobile cheque deposits
  • Joint accounts available
  • Cheap international money transfer

Open an EQ Bank Savings Account: General Savings (1.50%*) or EQ Bank TFSA (1.50%*).

EQ Bank also offers several other products including:

1. EQ Bank GIC: Get some of the best GIC rates with EQ Bank, with terms ranging from 3 months to 10 years, and GICs for TFSA and RSP accounts.

2. US Dollar Account: Save your USD cash and earn 1% interest on every dollar. You can also use this bank account for international money transfers.

3. Join Accounts: You can open an EQ Bank savings account with friends or your partner.

4. Mortgage Marketplace: EQ Bank customers can find competitive mortgage rates from more than 2,000 mortgage products.

Tangerine vs. EQ Bank: Savings Account

As of today (June 14, 2022), EQ Bank offers a 1.50%* non-promotional interest rate on its general savings account, while Tangerine is offering a 2.00% promotional rate for 5 months and 0.10% after.

Let’s drill down into the numbers using a savings account with $10,000 and a 1-year term:

EQ Bank: $10,000 x 1.50%
Interest earned = $150 per year.

Tangerine ⇒ First 5 months ⇒ $10,000 x 2.00% x 5/12 year
Interest earned during the first 5 months: $83.33
Remainder of year (7 months) ⇒ $10,000 x 0.10% x 7/12 year
Interest earned during the last 7 months = $5.83
Total interest earned for Year 1: $83.33 + $5.83 = $89.16

EQ Bank wins this round versus Tangerine by offering a significantly higher interest rate overall. If we assume rates stay the same in Year 2, EQ Bank will still pay $150 interest on a $10,000 savings, while earnings on a Tangerine account drop to $10 (no promo rate in the second year).

The same scenario also plays out with GICs, with EQ Bank offering higher rates. Compared to the pittance offered by the major banks, these rates are good.

EQ Bank vs Tangerine: Chequing Account

EQ Bank does not have a chequing account, however, its savings account works like a hybrid account and you can deposit cheques into it and make bill payments. You can connect up to ten accounts from other banks and transfers are FREE.

The EQ Bank Savings Plus account includes unlimited bill payments, debit transactions, and Interac e-Transfers.

With regards to ATMs, Tangerine customers have access to over 44,000 ATMs worldwide. EQ Bank does not currently issue a debit card, therefore all transactions are completed online.

Tangerine Bank has the edge over EQ Bank when we you consider their spending account options.

EQ Bank vs Tangerine: Convenience

Tangerine and EQ Bank both have mobile apps that are accessible on Android and iOS devices, and both banks do not have a brick-and-mortar presence.

For customer support, you can contact a service rep using chat, email, or phone.

While EQ Bank now also offers TFSA and RRSP accounts (savings and GICs), with Tangerine, you can really move all your banking needs over as it also provides loans and investment funds.

EQ Bank vs Tangerine: Security

Both EQ Bank (via Equitable Bank) and Tangerine are insured by Canada Deposit Insurance Corporation (CDIC).

What this means is that your deposits are insured by CDIC up to $100,000 per account category (i.e. Savings, Chequing, and GICs).

EQ Bank = Tangerine for this feature.

Conclusion

The factors that individuals take into consideration when choosing a digital bank will vary based on their needs and expectations.

For some people, any monthly banking fee is anathema, and they want an online bank that can handle all their day-to-day banking needs – such as with Tangerine.

If you are looking for the best savings rates for your money or are looking for high interest rates GICs, TFSA, or RRSP savings accounts, EQ Bank is an excellent choice.

You can also combine both banks to enjoy the benefits they offer.

Best Banking Offers in July 2022

Get a free chequing account and a *$350 cash bonus*

Unlimited free debits and Interac e-Transfer transactions.

No monthly account or transaction fees.

$350 cash bonus when you deposit $100 for 3 months.

Earn a high-interest rate on your savings (3% interest rate offer).

No monthly or minimum balance is required.

Earn cash back on purchases & grow your savings ($20 bonus)

Free reloadable prepaid card and budgeting app.

Up to 2% cash back on all purchases and 10% at brand partners.

1.20% savings interest on your entire account balance.

Get 3-day early access to $100 of your paycheque for free.

$20 bonus after using the card for your first purchase (use CASHBACK referral code at signup).

Get one of the highest savings rates in Canada ($150 bonus)

1.65% interest on every dollar.

Up to 150x interest more than other banks.

Combines savings and chequing account features.

Get a $150 cash bonus when you set up a payroll direct deposit.

No monthly fees and free unlimited transactions and Interac e-Transfers.

Best no-fee cashback credit card with $100 bonus

Earn 2% unlimited cash back in three spending categories.

Get a $100 welcome bonus with $1,000 spending in first 2 months.

0.5% unlimited cash back on all other purchases.

1.95% low balance transfer rate and insurance coverage benefits.

Retirement 101 eBook - 3D

Author

Photo of author
Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. He has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, CTV News, Canadian Securities Exchange, Credit Canada, National Post, CIBC, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

19 thoughts on “EQ Bank vs. Tangerine Bank 2022: How Do They Compare?”

  1. I switched to Simplii Financial back when it was PC Financial because of a really good points promotion they had. Now that they’ve done away with the points I’ve been thinking of switching over to Tangerine. The interest rates at EQ sound great so I might have to look into that for some emergency savings.

    • @Sarah: I also signed up for PC Financial when we started using the PC Mastercard for our grocery shopping. However, since they rebranded to Simplii and parted ways with PC, I have simply abandoned the account. EQ Bank definitely has one of the best non-promotional rates available today.

      • Hi Enoch, I need to park some cash with a higher interest, and have been looking at that Motive Financial and their “Savvy” account. I read, they are CDIC insured, but would like your input on the Company, if allowed. Thanks, Matt

  2. Hi Enoch , I’ve been thinking of switching over to meridian or there new digital bank called motusbank, what do you think of that online only bank ?

  3. EQ Bank does have a referral program, which seems to run every year, but only for a couple months. Check it out!

  4. good points

  5. Good article. I like the factual, unbiased approach, and the the way it was easy to read, understand, and compare ( in other words, layman terms). Info like this is what helped me make my decision.

    • @Andrew: Happy to hear you found the post useful!

  6. This is a nitpick, but your interest calculations totally ignore monthly compounding. The interest is calculated daily, but paid monthly, so the January interest would be added to your balance for February to earn interest on. It doesn’t make much difference in one year, but over time it will. It makes EQ Bank look that little bit better.

    • @Jeremy: True, this is the simplest way to show the differences in the interest rates. For larger amounts, the monthly compounding interest would amplify the higher EQ Bank rate.

  7. Hi Enoch,

    I’m a senior and planning to invest 10,000 $ in Tfsa, eq online bank. Is it a sensible thing to do as a senior?

    • @Htin: That’s a difficult question to answer as it will depend on your overall financial picture and your investment needs. That said, if you are looking to park money in savings and you want to get a great interest rate in Canada, EQ Bank offers one of the best rates we have found by far as of today.

  8. Hi Enoch, I have a savings account at Tangerine bank now & my wife is joint with me on it (joint depositer) If I open a savings account for my wife at Tangerine, will she get the 2.1% if we leave it in for 5 months only ?

    • @Fred: I’m not sure how Tangerine considers joint account holders and whether she will be treated as a first-time client when she opens an individual account. My guess is they won’t consider her to be a first-time client, however, you should probably check with their customer service.

  9. Hi Enoch! l want to park funds in EQ TFSA for the higher interest rates. Although, for daily banking EQ does not offer a debit card for cash withdrawals. I have been comparing Tangerine or Wealth Simple for non fee checking accounts and still having access to a debit card . What are your recommendations between the two and what would you lean towards?

    Thanks,

    • @Tim: Personally, I would do both EQ Bank and Tangerine. EQ Bank is one of the best for non-promotional (i.e. long-term) high-savings rates and Tangerine’s chequing works well. If you already have a Wealthsimple Invest account, you can also benefit from its Cash savings account, however, its chequing features are mostly pending.

  10. Hi Enouch
    I am planing to open New no fee account. Also I need to get secured credit card to build my credit Score. Which No fee account will help me.?
    Thanking you in advance
    I appreciate your services to many people, Be blessed
    Sam

Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

438 Shares
Share
Pin
Tweet
WhatsApp
Reddit