More Canadians are rethinking their bank. Should you?

Even though he had been banking with several of the big lenders for decades, his frustrations grew until they came to a head during one instance involving one of his registered accounts. He finally decided to pull the trigger and switch to a fintech as his primary bank.

Canada’s banking regulator has been streamlining its bank licensing framework, making it easier for smaller financial companies and provincial credit unions to enter the federal financial system and compete against the Big Six. It’s also giving consumers greater choice when it comes to who they want to bank with.

Choose a bank that fits your needs

But consumers shouldn’t just switch banks on a whim, said Natasha Macmillan, senior director of everyday banking at Ratehub.ca. They need to first think about what their needs are.

For instance, a fintech could be more suitable if someone is looking for a higher savings rate, lower bank fees and doesn’t need a brick-and-mortar branch. A credit union could be more attractive for those wanting personalized services, community involvement, and lower bank fees, Macmillan suggested.

However, some people may still prefer a brick-and-mortar experience and access to the broad range of services that a Big Six lender can offer. 

When considering switching to a smaller bank, Macmillan suggested comparing key factors, such as chequing account offerings, whether there’s a fee for transactions and ATM withdrawals, and its interest rates for savings. Other things to look for are mobile app accessibility, cybersecurity features and deposit protection through the Canada Deposit Insurance Corp., which protects consumer savings up to $100,000 if a member bank fails.

Bank loyalty is starting to weaken

Environics’ 2026 Canadian Financial Switching study, which surveyed more than 42,000 Canadians in seven cities, found 22% of respondents switched to a different bank over the past 12 months, compared with 24% in 2025.  

Traditionally, a lot of growth for incumbent banks comes from existing customers getting another product with them, such as a new credit card, savings account, investment account, mortgage, or line of credit, said Heidi Wilson, vice-president of financial services at Environics Research. 

“What softened most this year was that ‘stay loyal and open another account’ behaviour,” she said. “It suggests the automatic cross-sell advantage of incumbency may not be as strong as it used to be,” Wilson said. “Existing customers may be more willing to comparison shop, split their wallet, or try an alternative provider.”

Certified financial planner Nick Hearne said promotional offers often draw people to set up new accounts or switch banks, which shouldn’t be the primary motivation. “You want to separate the temporary offer from the ongoing relationship,” he said.

Hearne said it’s important to consider your overall relationship with a bank. “Investors should understand both what they are paying and what they are receiving in return, whether that is portfolio management, financial planning, tax co-ordination, retirement income planning or ongoing advice,” he said. “The key question is whether the advice and services being provided justify the cost,” he added.

Switching accounts should be done in stages, once you know your decision.

First, make sure the new account is fully set up and working, Hearne said. Then move over payroll or pension deposits, government deposits, and any tax benefits from Canada Revenue Agency, as well as pre-authorized payments for bills. Going over previous bank statements can also help identify infrequent payments, such as annual subscriptions, insurance, and property tax payments. 

“Then you probably want to leave that old account open for one or two billing cycles just to make sure you haven’t missed anything before closing that old account,” Hearne said. “The goal is not to switch quickly. The goal is to switch cleanly.”

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