Alterna Bank is a digital bank in Canada offering financial services including savings, chequing, investments, and mortgages. Online-only banks (with few or no physical branches) have become more popular as younger customers are comfortable with performing most bank transactions online and have become more sensitive to paying monthly chequing account fees.
Other popular competing financial institutions in the digital banking space include Tangerine, EQ Bank, Motive Financial, and Oaken Financial.
Who Are Alterna Bank?
Alterna Bank is the digital banking arm of Alterna Savings and Credit Union Ltd. Alterna Savings is a 110-year-old Canadian credit union based in Ontario and formed by the merger of CS Co-op and Metro Credit Union.
Alterna Savings and Alterna Bank are together referred to as Alterna Financial Group. While banking with Alterna Bank is mainly online, customers can access face-to-face service through Alterna Savings branch locations in Quebec and Ontario.
Alterna Bank Accounts
Alterna Bank offers a variety of accounts that cater to the needs of the average bank customer.
1. Alterna No Fee e-Chequing Account
This chequing account offers the following features:
Zero monthly fees
Free unlimited day-to-day transactions including withdrawals, transfers, me-to-me transfers, bill payments, cheques, pre-authorized payments, debit card payments, etc.
Free Interac e-Transfers
Free access to THE EXCHANGE network of ATMs (over 3,300 ATMs)
0.05% annual interest rate on your chequing account balance (maximum of $250,000 balance per customer)
2. Alterna High-Interest Savings Account
Their HISA account currently offers the following:
2.35% interest rate (on a maximum balance of $250K per customer)
No minimum balance
Free and unlimited transactions
Free and unlimited Interac e-Transfer
3. Investment Accounts
Alterna Bank offers both registered and non-registered investment accounts including:
TFSA eSavings Account – no minimum balance and no fees
TFSA eTerm Deposits (aka GICs) – 1 to 5-year term lengths, $500 minimum purchase, non-redeemable, and no fees
RRSP eTerm Deposits
RRIF Savings accounts and term deposits
Non-registered eTerm Deposits
Online investing via Qtrade Investor
They offer both variable and fixed-rate mortgages. Your mortgage legal fees and appraisals are covered up to $800.
Alterna Bank does not currently offer a credit card.
5. Overdraft Protection
Low monthly fee of $2.50
19.99% Annual Interest Rate
Access your overdraft limit through all channels linked to your eChequing account (bill payments, cheques, point of sale, pre-authorized debits, etc.)
Repayment is as easy as making a deposit to your account
Opening An Alterna Bank Account
You can easily open a new account online or call them at 1-866-560-0120.
Eligibility requirements include that you must:
Be a resident of Canada
Be the age of the majority in your province
Have a SIN
Have an account at one other Canadian bank
For Joint accounts, you will need to complete their Joint Account Authorization and email it to firstname.lastname@example.org
The Alterna mobile app is available on both iOS and Google Play.
The app allows you to:
Make bill payments
Transfer money between your Alterna accounts, to accounts at other financial institutions, and Interac e-Transfer
View your account transactions
Find an ATM near you
Set account alerts
Contact customer service, and more
Alterna Bank Fees
While the bank does not charge monthly fees on their chequing and savings accounts, other service fees may apply. Examples are:
Paper statement: $2/statement
Cheque image in statements: $2/statement
Interac ATM withdrawals: $1.90
Overdraft protection: $2.50/month
NSF fees: $42.50
Other fees may apply, so check their website for the full list.
How Safe Is Alterna Bank?
Is Alterna Bank safe? The answer to this is – Yes, just as safe as other Canadian banks.
The funds you deposit with the bank are protected by the Canada Deposit Insurance Corporation (CDIC) subject to maximum coverage limitations. This includes deposits in eSavings, investment savings, and term deposits.
Interest Calculation FAQ’s
How is interested calculated?
Interest is calculated daily on the closing balance and paid monthly. Interest rate is annualized and subject to change without notice.
Is interest paid above the account limit?
Although there is a maximum account limit any interest owed is always paid, regardless if it brings you above your account limit.
What happens if my balance exceeds the account limit?
If your account balance exceeds the account limit you will be contacted by an Alterna Bank representative who will review your options for moving your excess funds from your account.
Alterna Bank vs. EQ Bank vs. Tangerine Bank
Tangerine Bank is the most popular online bank in Canada. While most Tangerine clients will access them solely online, they have a few cafes, kiosks, and pop-up locations around the country that you can walk into. They offer a chequing account, high-interest savings, investment funds (registered and non-registered), mortgages, and a money-back credit card.
The Tangerine no-fee chequing account offers a higher interest rate of up to 0.65% on your chequing account balance (compared to 0.05% for Alterna). This chequing account gives you free access to 3,500 ATMs in Canada and 50,000 worldwide. You also get a $200 cash bonus for a new account.
The Tangerine high-interest savings account has no monthly fees and offers a promotional 2.75% interest rate for 6 months. You receive a $50 cash bonus when you sign up here and deposit at least $100.
EQ Bank is a top-tier digital Canadian bank that consistently offers one of the best savings interest and GIC rates in Canada. EQ Bank does not offer a traditional chequing account, however, their Savings Plus account functions as a hybrid account and can be used to deposit cheques and make bill payments. It also has no monthly fees.
Online-only banks like Alterna Bank can save you on monthly fees – up to $200 per year on your chequing account alone.
On the flip side, you will need to be comfortable with doing most of your banking online either using your computer, tablet, or smartphone. Online-only banks like Tangerine and Alterna may have limited person-person interactions/support through their few brick-and-mortar locations in major Canadian cities.
I use Tangerine Bank because they offer all the basic banking services I need i.e. chequing, savings, investing, and mortgages. Their 2% money-back credit card is also very competitive for a no-fee card.
For short and long-term savings, EQ Bank offers a great non-promotional savings rate and you can use them solely for savings while keeping your chequing and/or investments elsewhere.
Please leave your thoughts and comments below.
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Hey, I’m Sagar from Toronto, Canada.
I am a self-taught, motivated Canadian Personal Finance Blogger who loves writing articles about Savings, Investing, Stocks & ETF reviews, Side Hustles, Frugal Living, Credit Cards and Retirement Planning. Husband. Father. Software Developer. Web Designer. Hiking Enthusiast.