Having confidence in your savings is essential to building financial security. Canada’s banking system is strong and resilient, with rules and government organizations that work together to keep it that way. But there is always a chance that a bank could fail. If it does, what happens to your money?
How your finances are protected
In Canada, there are different organizations that offer protection in different ways, including:
- Federal deposit insurer through CDIC: Protects deposits in banks and other federally regulated institutions.
- Provincial deposit insurers: Protects deposits in provincial credit unions.
- Canadian Investor Protection Fund: Offers protection for non-guaranteed investments like mutual funds, stocks and bonds.
How these protections apply to your finances depends on the type of financial products and institution.
For example, the CDIC is Canada’s federal deposit insurer and provides deposit protection in the event one of its member banks fails. For each of its 80-plus members, eligible deposits are automatically insured up to $100,000 per account type, such as tax-free savings accounts (TFSAs) and Registered Retirement Savings Plans (RRSPs).
Deposits eligible for this protection include money in savings and chequing accounts, term deposits like Guaranteed Investment Certificates (GICs) and money in foreign currency, such as U.S. dollars. In the unlikely event your bank were to fail, we can protect your money in several ways, from restructuring the institution to quickly reimbursing your insured money.
How to learn more about keeping your money safe
Try using helpful online resources to learn more about these protections and the organizations that offer them. You can start by visiting the organization’s website to find out which one your bank is a member of and how they protect your finances. For example, we provide a list of all members as well as additional information and tools, like an online calculator you can use to help determine your coverage.
If you still have questions, don’t be afraid to ask—reach out to your financial institution to find out how you’re protected. Thanks to strong rules and government safeguards, banks in Canada don’t fail very often. But if one does, understanding the protections in place can help you feel financially secure.