In addition to its recently introduced Neo Card, a cash back credit card, Neo Financial also offers a high-interest savings account.
The Neo Savings Account gives you 1.30% interest on your balance which is a lot higher than what you get from most traditional banks these days…up to 130x more interest!
It also works like a hybrid account (i.e. chequing + savings) and this review covers its features and competitors.
What is Neo Financial?
Neo Financial is a startup financial technology company founded in 2019 by two of the co-founders of Skip The Dishes (Andrew Chau and Jeff Adamson), and Kris Read.
It currently offers a cash back credit card (Neo Card) and a savings account (Neo Savings).
Neo Financial Savings Account Benefits
1. High Interest Rate: Compared to the measly 0.01-0.05% being offered by many big banks, you earn a 1.30% interest rate with Neo Savings. Interest is calculated daily on your closing balance and it is paid out monthly.
2. Free Transactions: Similar to a chequing account, you can easily pay your bills, transfer funds to friends, make deposits, and use Interac e-Transfers for free.
3. No Minimum Deposits: There is no minimum deposit or balance to enjoy the high interest rate or no-monthly fee benefit.
4. CDIC Insurance: Your funds are held by Concentra Bank and are eligible for deposit insurance protection up to $100,000.
Downsides of a Neo Savings Account
If you are looking to fully replace your banking, this account does not offer paper cheques and mobile cheque deposits are not yet possible.
Neo Financial does not offer a debit card, so you will need to have a chequing account elsewhere if you do a lot of cash transactions or withdrawals at the ATM.
Neo Savings is not yet available in Quebec.
Is Neo Savings Safe?
Your Neo Savings Account is held at Concentra Bank which is a Schedule I bank with more than $36 billion in assets under administration.
It is a member of the Canada Deposit Insurance Corporation and this means your deposits are insured up to $100,000 per category and per depositor.
Neo Savings vs. EQ Bank Savings
EQ Bank is another challenger bank in Canada and the direct banking division of Equitable Bank.
It offers high-interest savings (EQ Bank Savings Plus Account), TFSA, RSP, and Guaranteed Investment Certificates.
The savings interest rate at EQ Bank is currently 1.25%.
Neo Savings vs. KOHO Earn Interest
KOHO is a financial technology company offering a cashback prepaid card, high interest savings account (HISA), credit building service, and early payroll.
Its HISA is also known as KOHO Earn Interest and offers a 1.20% interest. When you use a free KOHO Visa prepaid card to pay for purchases, you earn 0.50% in cashback rewards.
Here’s how the three financial platforms compare:
| Features | Neo Savings Account | EQ Bank Savings Plus | KOHO Earn Interest |
|---|---|---|---|
| Savings rate | 1.30% | 1.25% | 1.20% |
| Monthly fee | $0 | $0 | $0 |
| Free transactions | Bill payments, Interac e-Transfers, direct deposits | Bill payments, Electronic Fund Transfers, Interac e-Transfers | Bill payments and Interac e-Transfers |
| Accounts offered | General savings | General savings, TFSA, and RSP | General savings |
| Minimum balance | $0 | $0 | $0 |
| Mobile cheque deposits | No | Yes | No |
| Debit card | No | No | No |
| Offers a credit card? | Yes | No | Prepaid Visa |
| Paper cheques | No | No | No |
| Investments | No | GICs | No |
| Learn more | Visit Neo Financial | Visit EQ Bank | Visit KOHO |
Have you tried one of Neo Financial’s products? Let us know what you think in the comments below.
Neo Financial Savings Account Review
Summary
This Neo Financial Savings Account Review covers its high-interest rate, features, competitors, and more.
One fault with NEO. If you get a direct deposit from the Canadian government, like a GST refund, income tax refund, etc., they will put a 2-3 business day hold on it. If it is a direct deposit from any other company, they will put a 5 business day hold on it. Never heard of a bank putting holds on direct deposits.