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Motusbank, Alterna, Manulife, Simplii: Comparison of 4 online banks

To the point Motusbank, Alterna, Manulife and Simplii: Comparison of competitive financial products offered by these new online platforms.

After presenting the various products offered by the Motusbank, Alterna, Manulife and Simplii platforms, here is a short introduction on their arrival on the financial market as well as a comparison of the various financial products offered by each.

Introduction

We are currently witnessing a profound transformation of the Canadian banking landscape as traditional institutions are gradually losing ground to online financial institutions.

These new platforms offer many benefits to Canadian investors. We are talking about:

  • very low management fees,
  • free basic services (interac, withdrawal and money transfer) and
  • affordable financial products (credit card and debit cards, among others).

Motusbank, Alterna, Manulife and Simplii are all part of this trend and offer an interesting choice of services to Canadian users.

To this end, we will analyze in detail the main financial products each of these banks offers. We will also compare these banks with established digital institutions such as Tangerine and the EQB bank.

This exercise will allow us to determine which banking institutions stand out from the competition.

Comparison with other online banks

Motusbank

Alterna

Manulife

Simplii

Tangerine

EQB

Monthly fees

Free

Free

$10 per month for a combined checking and savings account

Free

Free

Free

Minimum balance to cancel charges

No

No

$1,000

No

No

No

Regular interest rate for the savings account

1,00 %

1,00 %

0,15 %

0,10 %

0,10 %

1,25 %

Savings Account Promotions

No

No

No

1.50% until October 31, 2021

2.10% for the first 5 months

No

Other promotions

None

Variable interest on deposits over $200 in a U.S. dollar checking account

0.20% interest for US Dollar Savings Account users

Opportunity to earn $200 when you open a new checking account (Deposit at least $100 in direct deposit for three consecutive months)

None

None

Chequing Account Comparison

There are no service fees attached to Motusbank, Alterna and Simplii chequing accounts. Manulife’s chequing account has a $10 per month fee. It should be noted, however, that these fees are attributable to the “dual function” of the account, which offers both a checking and a savings component to users. This fee can be waived by maintaining a minimum balance of $1,000 in your account each month.

In terms of current interest rates, we note an advantage for Motusbank and Manulife. These two institutions offer a return of 0.15% on all deposits in a chequing account compared to 0.05% for Alterna and Simplii. Even more, this generous interest rate differs favourably from Tangerine Bank, which offers a meagre 0.05%.

In short, we believe that the chequing accounts offered by Motusbank and Manulife are the best options for Canadian users.

Savings Account Comparison

Motusbank, Alterna, and Simplii savings accounts have no management fees. The Manulife Savings Account has a $10 monthly management fee because it offers both savings and checking account features. Tangerine and EQB savings accounts are also free.

Second, we note a wide disparity in the regular interest rates offered. Motusbank and Alterna have a clear advantage in this regard, offering a return of 1.00% compared to 0.15% for Manulife, Simplii and Tangerine. This interest rate, as good as it is, does not compete with the one offered by EQB which is 1.25%.

Finally, the banks analyzed in this article pale in comparison to the promotional interest rates offered to their users. Motusbank, Alterna and Manulife do not offer promotional rates on savings accounts. Simplii Bank, meanwhile, is offering a promotional rate of 1.5% on new savings account deposits between August 1st and October 31, 2021. Please note that this special offer is not available to Quebec users.

Tangerine Bank stands alone in this category as it provides a 2.10% return on any money deposited in the savings account over a five-month period.

All in all, Motusbank, Alterna, Manulife and Simplii savings accounts do have their advantages, but the fact remains that they are no different from the products offered by established online banks such as Tangerine and EQB.

Credit cards Comparison

Based on the analyses conducted for this article, we note that Alterna Bank stands out from its competitors in terms of the number of cards offered (6) and the diversity of these cards (no fees, low interest rate, travel). These financial products, as interesting as they are, are unfortunately not available in Quebec (except in Gatineau for Alterna) at this time.

Given this reality, we believe that Manulife Bank’s credit cards (2) represent the best alternative for Quebec users. Specifically, we find the Manulife Cash Plus Visa Infinite to be an excellent card because the annual fee is waived for the first year, earning rewards is easy (3% on grocery store purchases) and the included insurance is very helpful.

The credit cards offer for the four banks analyzed is comparable to the financial products offered by other digital banks such as Tangerine (Mastercard Remises, Mastercard World). However, it would be interesting for these banks to improve their offers in order to stand out from their competition.

Comparison of Investments

In our opinion, the investment vehicles offered to users are all very good. There is a wide variety of registered and non-registered accounts in addition to some of the best guaranteed investment certificates on the market.

However, we have to give the award in this category to Motusbank thanks to its partnership with Qtrade investment and Virtual Wealth.

This association allows users to benefit from personalized advice from financial planners and a modern online brokerage platform offering a wide range of stock market securities.

Comparison of Loans

This section is very difficult to separate, as all four banks analyzed have excellent products. We believe that the best option may differ from one individual to another, as needs vary greatly between users. We therefore invite you to compare the different financial products offered by these banks before making your choice.

Verdict on Motusbank, Alterna, Manulife and Simplii banks

In light of this analysis, we observe a varied offering of financial products from Motusbank, Alterna, Manulife and Simplii.

Indeed, the options in terms of investment and loans are multiple and address a wide range of customers. The management fees attached to the various accounts are also very attractive, even though most of them are free.

Finally, the interest rates offered to users are very competitive and surpass those offered by traditional banks such as CIBC, RBC, TD, Scotia and BMO.

However, we have to admit that there is still a lot of work to be done and several features need to be reviewed.

In particular, there is talk of the advent of attractive promotional interest rates (for a limited time) that could encourage users to apply for for an account with one of the four banks featured here.

We also believe that checking and savings accounts could be improved to truly compete with rival banks like Tangerine and EQB. Finally, we would like to see the financial products of Alterna Bank and Simplii Bank offered to all Quebecers.

All in all, these four banks show promise. However, many of their financial products will need to be reviewed in order to make significant progress into the Canadian market.

Come to discuss that topic in our Facebook Group!

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