Battle of the Banks: Scotiabank vs. RBC Royal Bank

Craig Sebastiano
by Craig Sebastiano April 21, 2017 / No Comments

The big banks in Canada offer everything from mortgages to credit cards. But trying to decide which one to bank with can be difficult, especially when many of their products are nearly identical.

When you compare the GICs and high-interest savings accounts, it’s easier to make a decision. This time, we pit Scotiabank against last week’s winner, RBC Royal Bank (sorry, TD Canada Trust).


Scotiabank has two types of non-redeemable GICs: Long-term and special rate GICs. The rates on the long-term GICs are similar to what other big banks offer while its special rate GICs are much higher. Here’s an overview of the rates on non-redeemable GICs the two banks offer on one- to five-year terms as of April 19:

Term Scotiabank long-term GICs Scotiabank special rate GICs RBC Royal Bank
1 year 0.85% 1.35% 0.9%
2 years 1% 1.6% 1.15%
3 years 1.05% 1.8% 1.25%
4 years 1.1% N/A 1.5%
5 years 1.25% 2% 1.6%

At Scotiabank, the minimum investment is $1,000 while it’s $500 at RBC Royal Bank for RRSP, TFSA, RESP, and registered disability savings plan (RDSP) accounts. Scotiabank’s special rate GICs aren’t the best GIC rates, but they are better than RBC’s rates.

Market-linked GICs

If you’re looking for higher potential returns without taking on a lot of investment risk, you may want to consider market-linked GICs. Both banks offer these types of GICs.

Read: Should You Put a Market-Linked GIC in Your RRSP?

Scotiabank and RBC each offer five of these GICs and the minimum investment at both institutions is $1,000. The terms for the five market-linked GICs Scotiabank offers are two, three, and five years. And the terms for three of RBC’s market-linked GICs are two, three, and five years while the two others only have three-year terms.

High-interest savings accounts

There are a number of savings accounts at Scotiabank and RBC Royal Bank. The Scotiabank Momentum Savings Account and the RBC High Interest eSavings account offer the highest potential returns. As of April 19, these are the rates:

Balance Scotiabank RBC Royal Bank
$0 to $4,999.99 0.05% 0.5%
$5,000 or more 1.3% 0.5%

The Scotiabank Momentum Savings Account has a tiered rate so your interest rate will be determined by how much is in your account. If you have a balance of less than $5,000, the rate is just 0.05%. But if you have more than $5,000 in your account, you’ll get 0.55% plus the potential to earn an additional 0.75% (for a total of 1.3%) every 90 days if “you do not initiate or permit any debit transaction or allow your balance to fall below the minimum balance required during that period.” Until Aug. 31, you can snag a special interest rate of 2.15% if you have more than $5,000 in your account and don’t make any withdrawals for 90 days. The interest rate on the RBC High Interest eSavings account is 0.5% on any balance.

The winner

Scotiabank wins this round because of its special rate GICs and its high-interest savings account offers the potential to produce a great return despite the fact that it’s a tiered rate. Next week, Scotiabank takes on BMO Bank of Montreal in the final chapter of our battle of the banks series.

Scotiabank Momentum Savings Account

Open an account

  • Earn 0.7% on balances less than $5000
  • Earn 1.45% daily on balances $5000+ paid out every 90 days if no withdrawals are made
  • No monthly fees

Also read:

Flickr: The City of Toronto