Competition for Canada’s best guaranteed investment certificate rates and high-interest savings account rates remains stiff this week, despite little movement from the previous week.
Achieva and WealthOne continue to lead the GIC rate leaderboard, offering some of the best GIC rates across major terms. The highest GIC rate currently available is Achieva’s five-year rate at 3.85 per cent, followed by its two-year rate at 3.80 per cent. MAXA Financial and Outlook Financial raised their three-year GIC rates this week, joining Achieva, WealthOne and Saven Financial at 3.70 per cent.
With longer-term GIC rates now exceeding comparable fixed mortgage rates, the spread between savings and borrowing costs has widened modestly for the popular five-year and three-year terms.
The leading five-year and three-year GIC rates stand at 3.85 per cent and 3.70 per cent, respectively, compared with the best fixed-term mortgage rates of 3.69 per cent for a five-year term and 3.54 per cent for a three-year term, representing a 16 basis point gap in favour of GICs for both terms.
At the short end, however, the dynamic reverses and the gap widens in favour of lenders. The best one-year and two-year mortgage rates are 4.69 per cent and 4.29 per cent, well above the GIC rates of 3.65 per cent and 3.80 per cent, respectively.
Savings account rates have been largely unchanged in recent weeks, with the Bank of Nova Scotia offering the top promotional rate at 4.65 per cent for three months. The Royal Bank of Canada and the Canadian Imperial Bank of Commerce follow closely at 4.60 per cent for the same term.
However, promotional savings rates drop by over 400 basis points after the promotional period, offering minimal ongoing returns.
Savers seeking stronger ongoing returns may consider providers offering higher non-promotional savings rates. Saven Financial currently leads with 2.85 per cent, followed closely by Oaken Financial at 2.80 per cent.
Canadian fintechs also reward loyal clients with competitive savings rates. Neo Financial offers 3.0 per cent on accounts with balances of $20,000 or more. KOHO pays up to 3.5 per cent through its paid plan.
Wealthsimple offers 2.25 per cent on registered CAD savings accounts and 3.25 per cent on USD savings accounts for clients with over $500,000 in assets.
Interest rates are provided by WOWA.ca, which gathers, aggregates and freely disseminates data on mortgage rates, savings accounts and GIC rates from 50+ Canadian financial institutions.
Sanika Purohit is a writer and content developer at WOWA.ca, a Canadian personal finance platform.
