Opening Bank Accounts In Canada As An International Student

As an international student in Canada, one of the first things you should do is open a Canadian bank account. This can be done in person or online, and it is recommended that you do this before arriving in Canada. Most financial institutions offer internet banking, allowing you to check your balance, pay bills, and transfer money without visiting a branch. There are several banks in Canada that offer student accounts with no monthly fees and other benefits, such as RBC, Scotiabank, and TD Canada Trust. To open an account, you will typically need at least two pieces of identification, such as a passport or driver's license, and proof of enrolment at a Canadian educational institution.

Types of accounts for international students

As an international student in Canada, you can open a bank account before you arrive, with no monthly fees and unlimited transactions. This is an important step to get settled in your new country of residence. You'll need at least two pieces of identification (ID) to open a bank account in Canada. This can include your passport, driver's licence, student ID card, or course timetable. Some branches may also require you to provide your local home address.

There are a few different types of accounts that international students can consider:

Chequing Accounts

These are the most commonly used bank accounts in Canada and are used for day-to-day banking needs, such as withdrawing funds at a branch, online, or through ATMs. Many student chequing accounts come with unlimited transactions and no monthly fees. To qualify for a student chequing account, you may need to be 23 or under and provide proof of enrolment in a full-time post-secondary education.

Student Bank Accounts

Many banks offer special accounts for students with perks like lower fees and free transactions. These accounts often come with no monthly fees and a higher number of free transactions. Some banks also offer welcome bonuses, such as cash rewards or freebies. Student bank accounts can help students build their credit history and savings.

Credit Cards

Credit cards are convenient for making purchases without carrying cash and give you a grace period before you need to pay. They are widely accepted at most major stores and restaurants in Canada. Just like a debit card, your credit card will have a PIN that you should keep secure.

Investment Accounts

Some international students may need to open a Guaranteed Investment Certificate (GIC) account as part of their application for the Student Direct Stream (SDS) program. This program offers a faster and smoother application process with higher rates of approval. However, students must open a GIC account and deposit a minimum amount, which they will get back once they start their studies in Canada.

Documents required to open a bank account

As an international student, you can open a Canadian bank account before you arrive. This is generally a good idea, and in some cases, it is a requirement. To open a bank account in Canada, you will need at least two pieces of identification (ID).

• Passport or Canadian driver's license
• Study permit or Temporary Resident Visa
• Proof of enrolment from your Canadian educational institution, such as your student ID card or course timetable
• Proof of financial support, such as bank statements for the past four months, or a letter of financial support from family or any other person
• Local home address in Canada
• Active phone number

In addition to these documents, some banks may have specific requirements or offer special programs for international students. For example, Scotiabank's Student GIC Program can help you meet the proof of financial support requirement and transition to life in Canada more smoothly. Through this program, you can wire transfer at least $20,835 CAD to Scotiabank in Canada, and $20,635 will be credited to your GIC while $200 pays the program fee. Once you arrive in Canada, you can open a student bank account with Scotiabank, and the funds will be deposited into your account.

It is important to note that the specific requirements and documents needed may vary depending on the bank and your individual circumstances. Therefore, it is recommended to contact the bank directly to confirm the required documents and understand their processes for opening an account as an international student.

Benefits of opening a bank account before arrival

International students can open a bank account in Canada before their arrival. This is generally a good idea and can even be a requirement for certain study permits. Here are some benefits of opening a bank account before your arrival in Canada:

Ease of Transition

Having a Canadian bank account before your arrival can help ease your transition into life in Canada. You won't have to worry about your previous bank account being frozen or accumulating currency conversion fees. It will also make it easier to get a phone plan, find accommodation, and handle other administrative tasks when you first arrive.

Meeting Financial Requirements for Study Permits

To study in Canada, you must provide documents showing you can afford to live and study there. Having a Canadian bank account, such as the Scotiabank Student GIC Program, can help meet these financial support requirements. This program requires you to wire transfer a minimum amount to Scotiabank in Canada and then apply for your study permit.

Access to Student Accounts and Benefits

By opening a bank account before your arrival, you can take advantage of student accounts and their benefits. Many banks offer no-fee student accounts with no monthly account fees and unlimited transactions. This can save you money on account maintenance and transaction charges. Additionally, some student accounts offer rewards programs, such as the Scene+™ rewards program, where you can earn points on everyday purchases and redeem them for various perks.

International Money Transfers

As an international student, you may need to transfer money to and from your home country. By opening a Canadian bank account, you can access global money transfer services offered by Canadian financial institutions. Some banks, like CIBC, offer unlimited no-fee international money transfers, which can save you a significant amount compared to in-branch wire transfers.

Access to Loans and Credit Cards

Once you have a Canadian bank account, you may be eligible for loans or lines of credit offered by the bank. This can provide you with financial flexibility and help cover expenses such as tuition and living costs. Additionally, some banks may offer credit cards tailored to students, which can be useful for building credit and making purchases without carrying cash.

How to transfer money to another country

As an international student, you can open a Canadian bank account before you arrive with no monthly fee and unlimited transactions. This is a fast, safe, and convenient way to transfer money to another person within Canada. All you need is the recipient's email address or Canadian mobile phone number.

When it comes to transferring money to another country, there are several options available to you. Firstly, you can use a third-party money transfer service such as Western Union or PayPal. These companies allow you to transfer funds from your local bank account to your Canadian account easily and efficiently. They offer competitive rates and low transfer fees, but be sure to compare their rates before choosing a service.

Another option is to use a platform like CurrencyFair or XE, which offer cheap and easy international money transfers. CurrencyFair provides the first 10 transfers for free, while XE rewards your first transfer with a gift card of up to $20.

Additionally, you can send money through your bank. Most financial institutions in Canada offer internet banking, allowing you to transfer money without visiting a branch in person. However, there may be a domestic wire fee applied by your bank, so always check with your local branch to understand their specific fees and charges.

When choosing a money transfer service, consider the costs involved. Banks and financial institutions in Canada must disclose their fees for sending money abroad, but these fees may vary significantly from one institution to another. Some charge a flat fee, while others vary their fees depending on the amount sent or the payment method used.

Finally, keep in mind that the time it takes for the money to arrive can vary from a few minutes to a few days, and sometimes there may be unexpected delays. If you need the money to arrive quickly, some services offer faster delivery for an additional cost.

Building a credit score

As an international student in Canada, one of the first things you should do is open a Canadian bank account. This will help you manage your finances and build a credit score, which is essential for various purposes like getting a phone plan, renting a home, or financing a car. Here are some detailed, direct, and instructive steps to help you build your credit score:

Choose the Right Credit Card:

When selecting a credit card, look for one with perks like cashback or discounts on purchases. More importantly, ensure the card has a credit limit that suits your needs. A higher credit limit is preferable, even if you use less of it each month. For instance, if you have a $5000 limit and spend $1000, your credit usage rate is 20%, which is ideal. Lenders view high usage rates as a risk, so aim for a rate below 30%.

Make Timely Payments:

Your payment history is the most critical factor in building a positive credit score. Ensure you pay your credit card bills and other monthly expenses, like utilities and phone bills, on time. Set up automatic payments or electronic alerts to help you stay on top of due dates and manage your finances effectively.

Keep Accounts Open:

The longer you have a credit account open, the better it is for your score. Avoid closing old accounts, even if you no longer use them regularly. Use them occasionally to keep them active and build a longer credit history.

Limit Credit Applications:

Every time a lender performs a "hard check" on your credit report, your score drops a few points. Multiple credit applications may also raise concerns about your ability to manage debt. So, only apply for credit products you genuinely need and space out your applications to avoid a flurry of hard checks.

Explore Student Credit Cards:

Many financial institutions offer credit cards designed for students, which can be an excellent way to build credit while learning financial responsibility. These cards often have lower credit limits and simpler repayment terms, making them more manageable for newcomers to credit.

Build a Comprehensive Credit History:

Remember that your credit score is just one aspect of your overall creditworthiness. Canada's credit bureaus, TransUnion and Equifax, also generate a credit report detailing your accounts, payment history, personal details, and more. A positive credit history, including timely payments and responsible account management, will enhance your overall credit profile.

Building a solid credit score takes time and discipline. By following these steps and maintaining good financial habits, you'll be well on your way to establishing a strong credit foundation in Canada.

Frequently asked questions