New immigrants come to Canada from various countries. In some countries the banking system is very similar to the Canadian system but in others it is very different.

We want to introduce some basic notions of banking in Canada and hope that this information will help you to avoid some of the mistakes that newcomers make.

There are five major Canadian banks, so called the "big five." They are:

Many banks in Canada including the five major banks are covered by the Canada Deposit Insurance Corporation. CDIC is a federal Crown corporation created by Parliament and insures Canadians’ savings in case their bank or other CDIC member institution fails or goes bankrupt.

If your bank is covered, you will receive up to $100,000 of your savings back if your bank files for bankruptcy. When you open an account at a bank, ask if the account you chose is covered by CDIC because in some banks some of the accounts maybe not covered.

When choosing a bank or credit union there are two types of accounts that you need to consider – chequing and savings. A chequing account is an easily accessible account that you will use to withdraw money for your everyday needs. You can also write cheques from this account.

A savings account is an account where you can keep your money and may earn a small amount of interest.

When choosing a chequing account you need to take into consideration service fees and the number of transactions. Every bank charges fees for its services. The least expensive chequing accounts cost about $4.00 a month.

Three of the banks on our list and VanCity Credit Union offer a waiver of this fee. That means that if you keep over $1,000 every day at your account at TD Canada Trust, CIBC or Vancity or $1,500 at BMO, the banks will waive the fee (you pay nothing).

Royal bank has a system called Multi-Product rebate. If you have a chequing account and a credit card or an investment account, you will not pay for some of the chequing accounts (remember to check this out at the bank). Some banks do not offer a waiver.

VanCity Credit Union has a special free account for government-sponsored refugees which they can use without paying service fees for a year while they are on the government program.

It is important to pay attention to the number of transactions that your account allows you to have for free. Transactions which are over the limit are charged at approximately $0.50-$0.65. So, if you had 10 additional transactions a month, you will have to pay an additional $5-$6.50.

Do not keep all the money that you brought from home or earned in Canada in your chequing account because chequing accounts do not earn interest. Keep your money in a savings account or make the choice to invest. You do not need to have a savings account in the same bank as your chequing account. If you want to invest your money, talk to a financial adviser or other specialist.

Savings accounts do not offer you large interest rates, especially during difficult times. Let’s assume that we want to put your money ($10,000) into a savings account. Today you will earn interest at the rate of 0.25 per cent up to 2.75 per cent. To find a bank with the highest interest rate use the money tool at http://www.moneytools.ca/ but double check the interest rates at the bank because the interest rates can change.