Guaranteed Investment Certificates (GICs) are a safe and secure Canadian investment that offers a guaranteed return over a fixed period of time. However, due to its low-risk nature, this kind of investment tends to come with relatively low rewards.
Currently, Alterna Bank offers 5 GIC options (called term deposits) with terms ranging between 1 to 5 years. All 5 options require a relatively low minimum deposit of $500 and allow a maximum deposit of $500,000. Interest rates start at 3.45% for a 1-year term deposit. Since Alterna is an online bank, it’s easy to invest in their GICs, making it accessible to more Canadians.
Alterna Bank GICs features
Here’s what Alterna Bank has to offer in terms of GICs.
Why You Want It
Get guaranteed return online + A low minimum investment.
Provinces
ALL
GIC
Non-Cashable
1 Year
2.75%
2 Years
2.9%
3 Years
3.15%
4 Years
3.3%
5 Years
3.4%
Features
Minimum Investment
$500
Available As FHSA
Minimum Cashable GIC Term (Days)
N/A
Available As RRSP
Maximum Cashable GIC Term (Days)
30
Available As TFSA
Minimum Non-Cashable GIC Term (Days)
365
Available As RRIF
Maximum Non-Cashable GIC Term (Days)
N/A
Minimum Market Linked GIC Term (Days)
N/A
Maximum Market Linked GIC Term (Days)
N/A
Minimum U.S. Dollar GIC Term (Days)
N/A
Maximum U.S. Dollar GIC Term (Days)
N/A
Alterna Bank GICs product rating: 4.0 stars
Alterna Bank GICs will do exactly what you expect them to do – give you a worry-free investment and a guaranteed return. The very accessible minimum investment of $500, together with a reasonable interest rate, are some of the reasons why Alterna Bank is considered to be one of the more popular online banking institutions.
Rating methodology
To calculate our Genius Ratings, we compare the features of the account or product in question with other similar products in Canada. We give each feature a score out of 5 based on that comparison. Once we’ve rated all the features, we run them through our proprietary algorithm to produce a final rating out of 5.
Learn more about our rating methodology.
The pros of Alterna Bank GICs
So, what exactly are the pros of Alterna Bank GICs?
Pros
Relatively low minimum investment
Alterna Bank offers 5 GIC options and all have a reasonable minimum investment of $500. Since the standard tends to be more towards $1,000 – this is pretty good. The bank also offers a special minimum investment amount to investors who are under the age of 19. For these youngsters, the minimum deposit is only $100.
No annual fees
Banks don’t charge fees when you invest in GICs. That’s because they carefully calculate their GIC rates to make sure the bank won’t lose any money during the term. The fact that there are no fees to invest in GICs must be one of the reasons why GICs are still popular in general, and also at Alterna Bank.
Easy application
Being an online bank in Canada that offers a number of different financial products, Alterna Bank prides itself on the fact that it takes less than 10 minutes to open an account using their simple online application.
The cons of Alterna Bank GICs
So, what are the negatives about Alterna Bank’s GICs?
Cons
Lock investment in for up to 5 years
A GIC is a term deposit that will lock your investment for a certain amount of time. To earn the highest possible GIC interest rate at Alterna Bank, you will have to opt for locking in your investment for at least 5 years.
Possible penalties for early redemptions
The terms and conditions state clearly that early redemptions of non-redeemable term deposits are only permitted in the case of financial hardship and are subject to loss of interest. The bank can also charge an additional fee at its own discretion.
Alterna Bank GICs alternatives
Let us take a closer look at how Alterna Bank compares with other online banks.
 |  |  |  | |
|---|---|---|---|---|
| Account | Alterna Bank GICs | Scotiabank GICs | Tangerine GICs | RBC GICs |
| Genius Rating | ||||
| Why You Want It | Get guaranteed return online + A low minimum investment. | Get flexible terms and interest rates + 100% guaranteed return. | Ultra competitive rates + No minimum investment to get started. | Plenty of cashable options + Get personalized advice with MyAdvisor. |
| GIC | Non-Cashable
| Cashable
Non-Cashable
| Non-Cashable
| Cashable
Non-Cashable
|
| Minimum Investment | $500 | $500 | $1 | $1,000 |
| Available As FHSA | | | | |
| Minimum Cashable GIC Term (Days) | N/A | 365 | N/A | 30 |
| Available As RRSP | | | | |
| Maximum Cashable GIC Term (Days) | 30 | 365 | N/A | 3,650 |
Show More | ||||
| Open an account See more Alterna products Compare | Open an account See more Scotiabank products Compare | Open an account See more Tangerine products Compare | Learn More See more RBC products Compare |
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FAQ
What kind of GICs does Alterna Bank have available?
Alterna Bank is currently offering 5 different non-redeemable GICs on their website. Click here to learn more about them.
Do Alterna Bank GICs have good rates?
Generally, GICs are not known for having high-interest rates. However, Alterna Bank’s GIC interest rates stack up well against the competition. See how they compare to Tangerine, Oaken, and Scotiabank here.
What are the pros and cons of investing with a GIC?
The most obvious pro is that your investment is safe and you will receive a guaranteed return over a fixed period of time. A clear con is that you won’t get rich or even earn a significant return on your investment.
Editorial Disclaimer: The content here reflects the author's opinion alone, and is not endorsed or sponsored by a bank, credit card issuer, rewards program or other entity. For complete and updated product information please visit the product issuer's website.
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