Bank Fees in Canada: Common Charges and How to Cut Them

It’s easy to feel like your money is slipping away, especially when you see small charges nibbling at your bank account balance. These bank fees in Canada can seem minor at first, but they add up over time, costing you more than you might realize. From monthly maintenance charges to fees for using an ATM, these costs can quietly drain your funds. Understanding what you're being charged for is the first step toward keeping more of your hard-earned money. Fortunately, you have more control over these fees than you think. By learning about the most common charges and adopting a few smart strategies, you can significantly reduce or even eliminate the bank fees in Canada you pay each month. This guide will walk you through the most frequent fees and give you practical, easy-to-follow tips to cut them from your budget.

Why Do Banks Charge Fees?

Banks provide a range of services, from keeping your money secure to processing payments and transfers. In return for these services, they often charge fees. These fees help cover the operational costs of running the bank, including maintaining branches, operating ATMs, and providing customer support. While some fees are for specific services, others are simply for maintaining an active account. Knowing the difference helps you identify which charges are avoidable.

The Most Common Bank Fees in Canada

Many Canadians are paying fees without even realizing it. Here’s a breakdown of the most common charges you’re likely to encounter and what they mean for your wallet.

1. Monthly Maintenance Fees

This is one of the most widespread bank fees in Canada. It’s a flat fee charged each month simply for having a chequing account. The cost can range from a few dollars to over $30, depending on the account's features. Many people accept this as a standard cost of banking, but it's often avoidable.

2. Transaction Fees

Some bank accounts come with a limited number of free transactions per month. A transaction can include debit card purchases, bill payments, pre-authorized debits, or e-Transfers. Once you go over your limit, the bank charges you for each additional transaction. These per-transaction fees can add up quickly if you’re not careful.

3. Overdraft and Non-Sufficient Funds (NSF) Fees

These are two of the most expensive penalties.

NSF Fee: a Non-Sufficient Funds (NSF) fee is charged when you try to make a payment (like a cheque or pre-authorized debit) but don’t have enough money in your account to cover it. The payment is rejected, and the bank hits you with a hefty fee, often around $45.
Overdraft Fee: overdraft protection allows a transaction to go through even if it takes your balance below zero. While this can be helpful in a pinch, it comes at a cost. You’ll be charged a fee (around $5) plus interest on the overdrawn amount until you pay it back.

4. ATM and Withdrawal Fees

Using an ATM that isn't owned by your bank is a sure way to incur fees. You'll often be charged by both your own bank and the ATM operator. These fees can range from $2 to $5 per withdrawal, making it an expensive way to get cash. Some accounts also limit the number of free withdrawals you can make from your own bank's ATMs.

5. Interac e-Transfer Fees

While many modern accounts offer free or unlimited Interac e-Transfers, some older or more basic accounts still charge for them. This fee is typically around $1.50 per transfer sent. If you frequently send money to friends or family, this is a fee you'll want to avoid.

6. Paper Statement Fees

In an effort to go green and cut costs, most banks now charge a fee for mailing paper statements. This is usually a few dollars per month. Switching to electronic statements is a simple way to eliminate this charge completely.

Actionable Strategies to Avoid Bank Fees in Canada

You don’t have to accept bank fees as an unavoidable expense. With a proactive approach, you can keep that money for yourself.

1. Maintain a Minimum Balance

Many of Canada’s major banks will waive the monthly fee on your chequing account if you maintain a minimum balance. This amount is typically between $3,000 and $6,000. If you can comfortably keep that amount in your account without dipping below it, you can avoid a monthly fee of $15 or more. Just be careful—if your balance drops below the minimum for even one day, the fee will be charged.

2. Choose a No-Fee Bank Account

The simplest way to avoid monthly bank fees in Canada is to switch to an online-only bank. Institutions like Tangerine, Simplii Financial, and EQ Bank offer chequing and savings accounts with no monthly fees, no minimum balance requirements, and unlimited transactions. Because they don't have the overhead costs of physical branches, they pass those savings on to you.

3. Go Paperless

Log in to your online banking portal and switch your statement preferences to electronic. This simple click can save you around $2 to $3 every month. You can still view, download, and print your statements whenever you need them.

4. Use Your Bank’s ATM Network

Make it a habit to only withdraw cash from ATMs that belong to your financial institution. Use your bank’s mobile app or website to find the nearest in-network ATM. If you need cash, plan ahead so you’re not forced to use an out-of-network machine in a pinch.

5. Explore Low-Cost and No-Cost Accounts

The Government of Canada has a commitment with major banks to offer low-cost accounts for no more than $4 per month. These accounts include a minimum of 12-18 transactions per month. Furthermore, certain groups are eligible for no-cost accounts, including:

Seniors receiving the Guaranteed Income Supplement (GIS)
Youth and students
Registered Disability Savings Plan (RDSP) beneficiaries
Newcomers to Canada (for their first year)

If you fall into one of these categories, talk to your bank about switching to a no-cost account.

6. Set Up Account Alerts

Use your bank’s mobile app to set up alerts. You can get a notification when your balance drops below a certain amount, helping you avoid NSF or overdraft fees. You can also get alerts for deposits and withdrawals, which helps you monitor your account for fraudulent activity.

7. Bundle Your Banking Services

Some banks offer "multi-product rebates." If you have a chequing account, a credit card, and an investment or mortgage with the same bank, they may waive your monthly account fee. If you already have multiple products with one bank, it’s worth calling to see if you qualify for a rebate.

Take Control of Your Banking Costs

Bank fees in Canada are a common frustration, but they don't have to be a permanent part of your financial life. By understanding what you’re paying for and making a few strategic changes, you can significantly reduce these unnecessary costs. Start by reviewing your bank statements from the last few months to see exactly what you've been charged. Then, choose one or two of the tips above to implement. Whether it's switching to a no-fee account or simply going paperless, every dollar you save is a dollar you can put toward your own financial goals.