For many immigrants, choosing a bank is an essential step. Most Canadian banks offer online banking services that allow you to manage your finances conveniently while saving money and time. You can use online banking tools and apps to transfer money, pay bills, and check account activities from your cell phone.
While online banking in Canada is generally safe, common threats exist, including phishing, malware, identity theft, and account takeover. In this Remitly guide, we discuss how to set up an online bank account and create a secure password. We’ll also dive into helpful Canada banking security tips like choosing the right financial institutions, plus other practical ways to keep your personal information safe.
Is online banking safe in Canada?
Online banking in Canada is heavily regulated. This means your account is protected under some of the industry’s most comprehensive policies.
Security measures implemented by Canadian banks
Canadian banks employ various security measures to safeguard your transactions and personal information. These include:
Encryption
Banking institutions use cryptographic algorithms to convert data into code that is unreadable without specialized training. This means no one can access your data without a decryption key.
Encryption helps prevent data breaches, unauthorized access, and digital eavesdropping. Even if a breach occurs, criminals can’t use the bank’s sensitive information if it has been encrypted.
Multi-Factor Authentication (MFA)
This approach requires passing multiple identity authentication steps before accessing an account. These steps may include one-time tokens, passwords, smart cards, or biometrics.
Regulatory protections for online banking users
Financial institutions in Canada are mandated to comply with certain laws to ensure the protection of online banking users. They often also follow certain internal policies and rules established by relevant regulatory bodies:
- The Bank Act: This is the main legislation governing Canadian banks. The Act outlines various ways financial institutions must protect their customers from fraud and other security threats.
- Personal Information Protection and Electronic Documents Act (PIPEDA): This law requires banks to protect your privacy and personal information.
- Competition Act: Under the provisions of this law, financial institutions can’t use predatory pricing methods or make misleading claims to the general public.
- Bank commitments: Various institutions also have formal commitments with the Canadian government to prevent fraud or unauthorized access to customers’ credit card details.
- Canada Deposit Insurance Corporation: Many Canadian banks are members of this organization, which insures your deposits in checking and savings accounts, as well as other financial products. Learn more about deposit insurance on the official website.
Importance of online banking for newcomers in Canada
Besides privacy, data, and anti-fraud protections, online banking has many benefits for newcomers trying to settle in. They include:
Say goodbye to long queues
If you visit your local bank branch, be ready to wait in line. However, online banking saves you all the hassle. You can view account statements, balances, and other important details without a physical bank visit. Plus, depositing a cheque is a breeze: most banks allow you to simply take a photo of the document and submit it online.
Set up and stick to a budget
Online banking tools can help you create a budget and offer incentives so you adhere to it. You can easily make savings goals and track your progress. Additionally, some banks allow you to set up alerts on your phone whenever you exceed the budget. This feature could be useful if you’re saving up for something special or just want to manage your finances more effectively.
Pay bills online
Most online banking systems allow online bill payment. It’s a quick, easy way to settle credit card bills and other utility fees, such as internet or telephone service. What’s more, you don’t have to remember when everything is due; just set up recurring payments on your bank account to automatically deduct the cost at a set time.
Enjoy 24/7 account access
Working hours in most Canadian banks are between 9 a.m. and 5 p.m., so finding the right time to visit your branch on a weekday can be challenging. However, online banking gives you 24/7 access to your account. That way, even the busiest individuals can keep up with every banking need.
Protecting your online banking information
While banks in Canada are strict about securing your banking information, adding extra layers of security certainly wouldn’t hurt. Here’s what to do to ensure criminals don’t copy or capture your financial details:
- Do not use public computers or public Wi-Fi for online banking. Anyone can see your browsing information across public networks.
- If you must access banking formation via a public computer, wipe the cache and browsing history once you are done.
- Don’t share your password, PINs, or user IDs with others, including family members.
- Don’t store passwords or usernames on mobile devices, nor set your smartphone or computer to remember sensitive online banking information, such as your account number, password, or PIN.
- Avoid using the same password for all your accounts. Instead, set different ones for each to minimize losses in case of a breach. Be sure to create strong, secure passwords that meet basic security standards.
Best practices for creating secure passwords
If you want your new password to be bullet-proof, follow these industry-wide best practices:
- Make your passwords 12 characters long. However, 14-character options are even more secure.
- Avoid using words that someone can find in a dictionary, such as the name of a product, place, person, organization, or character.
- Combine lowercase and uppercase letters with numbers, symbols, and spaces.
- Use memorable phrases that are easy for you to remember but hard for anyone else to guess.
- Avoid one-word passwords or words followed or preceded by one number, such as Password5. Hackers will have a field day guessing such passwords.
- Never tell anyone else your password. Just as you wouldn’t hand strangers your ATM PIN or debit card, don’t share your password, even with a bank’s IT department. If someone asks for your password, it is probably a scam.
- To reduce risk, never send your passwords via instant messages, email, or other unsecured forms of communication.
- If memorizing multiple passwords is difficult for you, use a password manager. The best managers automatically update any stored passwords and may ask for multi-factor authentication.
You can learn more about avoiding scams here.
Setting up your first online bank account in Canada
Before opening a new bank account, compare and contrast the options available in different financial institutions. Read on for tips to guide you through the process.
Choosing the right bank for newcomers
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Account fees
How much will the account cost you? Also, look past the monthly fees and consider hidden charges like overdrafts or transaction fees.
Interest
If you want to grow your savings, consider accounts that offer higher annual percentage yield. This way, your funds will compound at a steady rate.
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Customer service
It is essential to select a bank with quality customer service. Staff should be ready to answer questions, help prevent unforeseen risks, and offer tailored advice for your unique situation. Some banks have dedicated services for newcomers, from language assistance to cyber security resources that will keep your account.
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Minimum balance requirements
Some banks don’t have minimum bank requirements, while others waive fees for accounts that maintain a minimum balance. Find out where a financial institution falls before making yur choice.
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Transaction limits
Banks generally allow unlimited transactions, but others set limits as an anti-fraud measure. How many transfers, deposits, and withdrawals are you likely to make each month? This knowledge will help you choose the right bank.
Step-by-step guide to opening an account
Now that you have made a final decision, here’s how to set up your first online bank account as a newcomer in Canada:
Step 1: Access the bank website or mobile app
After choosing a suitable Canadian financial institution, visit their website and look for an “Apply” or “Open an account” prompt. Click the appropriate button and fill out the form with relevant details like your name, phone number, contact details, and address.
Step 2: Verify your identity
Most online-only banks allow you to verify your identity by photographing your government-issued ID and uploading it to the web platform or app. If the bank has a physical location, you could be asked to visit their premises with an original ID instead of a copy.
Step 3: Submit the application
After completing verification, it’s time to submit the details. Set-up usually takes just a few minutes, and you can start using the online bank account immediately.
Step 4: Using your online banking account
Launch a secure internet connection on your phone, tablet, or computer to begin using your account. Next, enter your username or login ID and password. This might be the account number on your bank card or cheque.
You may be required to complete another authentication step, such as entering the one-time code sent via email or text.
Additional tips for safe online banking practices
Here are some more useful tips for a secure online banking experience:
1. Update software and banking apps regularly
Keep your device operating system, banking apps, and antivirus software updated to seal any security loopholes. The quickest way to achieve this is by enabling automatic updates, thus avoiding manual oversight.
2. Be cautious when using public Wi-Fi
Public Wi-Fi networks are typically unsecured, and they can allow crooks to intercept your personal and financial data. So, we don’t recommend using these networks, but if you must, avoid accessing banking data and encrypt your online traffic using a VPN.
3. Monitor your account activity
Keep an eye on your banking account activity with the following actions:
- Enable account alerts: Set up real-time alerts for every activity on your account, including log-in attempts, withdrawals, and account setting changes. These alerts can help you detect unauthorized account activity early and take quick measures.
- Review bank statements regularly: Look out for unusual or unauthorized transactions. If you notice anything strange, inform your bank immediately.
- Educate yourself on cyber security: Cybercriminals often take advantage of ignorance to manipulate people into disclosing financial details. When armed with information, you can quickly identify and counter possible threats.
Secure your account and grow
As a newcomer to Canada, opening an online bank account makes it easier for you to save, invest, and participate in your community. However, it’s important to select a financial institution that offers robust security and aligns with your needs. Use these tips and take the necessary steps to protect your privacy and sensitive financial information online.
FAQs
Is it risky to have online banking?
Online banking is safe as long as you take the proper precautions and implement best practices. Set strong passwords, avoid accessing your banking data on public networks, and don’t share your passwords with anyone.
What kind of security do you need for online banking?
To ensure safety in online banking, a variety of security features are required. These include data encryption, multi-factor authentication, anti-phishing software, and strong passwords. Banks must also follow strict regulations that protect you as a consumer.
Which bank account is best for new immigrants in Canada?
Canada is home to a large number of financial institutions, so you can easily find a bank that will fit your needs. To choose the right account, consider factors like account fees, minimum balance requirements, customer service, and transaction limits.