What is a Chequing Account?


A chequing account, also spelled chequing, is a bank account designed for everyday use and spending. Because chequing accounts are meant for daily use, they tend to have very little limitations. There is a catch as these benefits are not free, a chequing account typically comes with monthly fees. A chequing account is primarily used for things such as paying bills, direct deposits from your employer, grocery shopping and cash withdrawals.


Types of Chequing Accounts


  • Personal Accounts. This account typically comes with a monthly fee and a set number of allowable monthly transactions. Despite these small drawbacks, a personal account is the most commonly used type of chequing account.


  • Student or Youth Accounts. This type of chequing account is designed for students or individuals under the age of eighteen who need a low cost, daily use bank account. To qualify for this type of account, you will need to meet the criteria, more specifically age and education requirements.


  • US Dollar Accounts (or Other Currency). Do you travel to the United States or other countries often? Do you use another currency frequently? If so, a chequing account in US currency or another currency can help you save on exchange rate fluctuations and other foreign currency handling fees.


  • Cash Back. Wouldn’t it be nice if you could make money while you spend? The good news is, you can with a cash back chequing account! While this type of chequing account is rare, it is not impossible to find one.


  • Most chequing accounts do not earn interest on the money in the account, but it is possible to find an account with interest benefits. It is important to note that the interest rate will likely be lower than the interest you’d get on a savings account.


  • No-fee. Chequing accounts with no fees are available on the market. However, to get one, you may need to switch banks and abide by stricter restrictions.


Advantages & Disadvantages of Chequing Accounts


As with all things, there are pros and cons associated with chequing accounts. If you use a chequing account for its intended purpose, you can make the most of the advantages and offset the disadvantages. Let’s explore the advantages and disadvantages below.




  • Flexibility and Convenience. Easy to access your money and move it around as you please.


  • Multiple, Easy to Use Payment Methods. Chequing accounts come with a linked debit card that you can use to purchase items and withdraw money. In addition, you can also order cheques to make payments if you need to.


  • Link to Other Bank Accounts. The majority of financial institutions allow you to link your chequing account to your savings accounts, or other accounts. This link allows you to easily transfer money between accounts free of charge.


  • Record Transactions. Using a chequing account helps you keep a record of your expenditures. The spending records you keep are valuable as they can help you budget.




  • No Earned Interest. Any money stored in a chequing account usually does not earn interest.


  • Minimum Balance Requirements. Some financial institutions offer chequing accounts with fees that only become applicable when you do not satisfy the minimum balance requirements. For example, you would only pay fees if you did not have $1,000 in your chequing account throughout the month.


  • Withdrawal or Access Fees. To access your money, you may need to pay fees at times. For example, some ATM withdrawals will have a small fee to take out cash.


  • Choosing the Wrong Account. If you choose an account with the wrong features for your lifestyle, you could end up paying unnecessary, pricey fees.


  • Optimization of Limited Transactions. If you don’t monitor your activity, it’s easy to go over your set limit of transactions each month or fail to meet other limitations. Try your best to optimize each transaction. For example, getting cash back when you make a purchase or have your pay cheque deposited into your savings account. This way, you’ll hit two birds with one stone!


Picking a Chequing Account for Your Needs


There is no “one fits all” chequing account solution. The reality is, everyone’s everyday banking needs are different and unique. The chequing account that works for you may not work for someone else. To help navigate through your options and find the best account for your individual needs, ask yourself the below list of questions.


  • What is a must have feature of a chequing account that I cannot live without?
  • Are the applicable fees worth what I get in return?
  • Am I willing to switch banks to get a better chequing account offer?
  • What will I use my chequing account for?
  • Do I need a high amount of transactions each month? Or can I get away with a low amount?
  • Where do the majority of my banking transactions take place? In person? Over the internet? By phone?
  • Do I have enough money to satisfy “minimum balance” requirements? Am I willing to lose earned interest by putting that money into chequing instead of savings?
  • Do I need easy access to US currency or other currencies?
  • Is it important to me to earn interest with my chequing account?


How to Open a Chequing Account


Now that you’ve decided you want a chequing account and have found the right fit, it’s time to actually open the account you want. Every financial institution varies slightly in their procedures, but below are some general requirements and documentation you can expect to incur when opening an account.


Requirements to Open an Account


  • You will likely need to be a citizen or permanent resident to open an account where you currently live. This includes having a valid, local address. If you’re a temporary resident, be prepared to present your passport and immigration papers.
  • Age of Majority. To open an account on your own, you need to be eighteen years of age, or the age of majority where you live. If you’re not the age of majority, you will need to have a parent or guardian co-sign on the account.


Necessary Documentation


  • SIN Number. Your social insurance number is needed to apply for a bank account.
  • Basic Personal Information. You will need to present personal information, including (but not limited to) your full name, address, email and phone number.
  • Valid Identification. To apply for a bank account you need two pieces of legitimate government issued ID. For example, a passport, driver’s license and health card.


Once you’ve provided all the necessary information and documentation to open an account, your account will be ready to use. Depending on the bank, the account could be open the same day you apply or you may need to wait a few business days. When the account is ready, you’ll get a confirmation package in the mail along with your debit card. Debit cards usually require activation, instructions to do so will be included in the package you receive. After all that, you can start using your chequing account as you wish!


Other Bank Accounts to Consider


A chequing account is merely one type of bank account you will use in your lifetime. You will likely want to do other things with your money, such as save for a big purchase or start a retirement fund. Below are different bank account types, their purpose, and corresponding benefits and drawbacks.


Savings Account


Arguably the second most common type of account after a chequing account, a savings account is used to save money, just as the name implies. A savings account is an excellent place to store an emergency fund or save for a big ticket purchase. Savings accounts have low fees and earn interest on the balance. This means you can make money on your idle savings. Lastly, savings accounts do not come with a debit card and withdrawals are quite limited.


Joint Account


A joint account is the exact same thing as a chequing account but you share access to the account with one or more persons. Joint accounts are commonly used by individuals who live together and share a lot of expenses. Unfortunately, you are responsible for the spending of the other people who have access to the account. If they over spend, that becomes your obligation too.


Registered Retirement Savings Plan (RRSP)


Set up by the Government of Canada, a registered retirement savings plan allows you to put money into a special account for retirement purposes while also reaping tax benefits annually. The money in the account is tax free until you withdraw from it.


Tax Free Savings Account (TFSA)


Also set up by the Government of Canada, a tax free savings account allows individuals over 18 years old to set aside money, tax free, throughout their lifetime. Similarly to an RRSP, once money is withdrawn from a TFSA, it is considered income that will be taxed. Unlike an RRSP, there are no annual tax benefits to using a TFSA.


Investment Account


If you have some extra money saved up, you may want to invest it somewhere to make money on your money. There are ample investment accounts available, be prepared to do some research before selecting one that works best for you. Investment accounts will likely have fees just like chequing accounts do.


Make Banking a Part of Your Life, Not Your Whole Life 


Chequing accounts, among other bank accounts, are supposed to compliment your lifestyle and make everyday banking easy. Choosing the right account will make banking a part of your life, not your whole life. If you choose the wrong account, it can become extraordinarily difficult to manage your finances and cause unnecessary stress. Before making any bank account decisions, consider your options, financial goals and current spending lifestyle. That way, you’ll pick the most ideal account for you!

Compare other chequing accounts 


Author Bio

Mohamed Konate

Mohamed Konate is a personal finance expert, blogger, and marketing consultant based in Toronto. He is a former financial services professional who worked at major Canadian financial institutions for many years. He managed the marketing strategy around various financial products ranging from credit cards to lines of credit. Mohamed is passionate about personal finance and holds a Bachelor's in Business Administration from the University of Quebec (Montreal) and a Master's in International Business from the University of Sherbrooke (Quebec). He is also the author of the Canadian Credit Card Guidebook.