How to Switch to a Credit Union
Switching banks is more straightforward than most people expect. This guide walks you through every step, from choosing a credit union to closing your old account safely.
Total time
60–90 days
for a complete, stress-free transition
Active effort
2–3 hours
of actual work across all steps
Cost to switch
$0–$25
membership share (often refundable)
The 6-Step Switching Process
Find the right credit union
Use our directory to browse credit unions by province, city, or rate. Key things to check: eligibility requirements (some require a community connection, others are open to all Canadians), HISA and GIC rates if savings are a priority, digital banking quality if you rely on mobile banking, and deposit insurance coverage in your province.
Filter by 'Open to all' in our directory to find credit unions anyone can join, no matter where you live.
Open your new account
Most credit unions allow you to open an account online, by phone, or in-branch. You'll typically need a government-issued ID (driver's licence or passport), your SIN (for registered accounts like TFSAs and RRSPs), and an initial deposit, often as low as $5–$25 to purchase a membership share.
Ask specifically about transferring existing registered accounts (TFSA, RRSP) to avoid unnecessary tax consequences from improper withdrawals.
Set up direct deposit and Interac e-Transfer
Notify your employer's payroll department of your new account details (transit number, institution number, and account number). This typically takes 1–2 pay cycles to take effect. Update your Interac e-Transfer auto-deposit to your new account if you use one.
Run both accounts in parallel during the transition. Don't close your old account yet.
Redirect recurring bill payments and pre-authorized debits
Make a list of every recurring payment linked to your old account: utilities, streaming services, insurance premiums, gym memberships, mortgage or loan payments, and credit card auto-pays. Update each one with your new account details. Keep records of confirmation numbers or emails.
Check two to three months of bank statements to catch every recurring charge; it's easy to miss annual or quarterly payments.
Monitor both accounts for 60–90 days
Keep your old account open with a small buffer (enough to cover any stray charges) for at least 60–90 days after switching. This catches any payments you may have missed redirecting. Some billers take several cycles to process the change.
Set a calendar reminder at 60 days to review both accounts before making the final decision to close.
Close your old bank account
Once you're confident all direct deposits, pre-authorized debits, and outstanding cheques have moved or cleared, contact your old bank to close the account. Ask for written confirmation of the closure and request any remaining balance be transferred or sent by cheque.
The biggest risk at this stage is a pre-authorized debit you missed redirecting in step 4. Double-check a full statement cycle before closing.
What About Registered Accounts (TFSA, RRSP)?
Do not withdraw: use a direct transfer
Withdrawing RRSP funds and re-depositing them at a new institution is a taxable event and you permanently lose the contribution room. For TFSAs, a withdrawal won't cause tax issues but the contribution room is not restored until January 1st of the following year. Always use a direct registered transfer between institutions. For RRSP, RRIF, SPP, and PRPP transfers the form is CRA Form T2033; locked-in plans (LIRA, LRSP) use T2151; TFSA transfers use each institution's own TFSA transfer form. Your new credit union handles the paperwork for you.
Ask the receiving institution to initiate the transfer
Your new credit union handles most of the paperwork. The transfer typically takes 5–15 business days. Some institutions charge a transfer-out fee (typically $50–$150); ask your new credit union if they will cover this.
Frequently Asked Questions
Will switching affect my credit score?
Closing a bank account does not directly affect your credit score; bank accounts are not part of your credit file. However, if you have a line of credit, overdraft, or credit card tied to your old bank, cancelling those could affect your credit utilization ratio. Keep your credit products separate from your everyday banking decision.
Can I switch if I have a mortgage with my current bank?
Yes. Your chequing and savings accounts are separate from your mortgage. You can switch everyday banking to a credit union while keeping your mortgage at the current bank, or renew your mortgage at the credit union at your next renewal date.
What if my employer won't change direct deposit in time?
Most payroll departments can process direct deposit changes within two pay cycles. In the meantime, keep your old account open with enough funds to cover any debits. Do not close it until direct deposit has successfully moved.
Is there a fee to join a credit union?
Most credit unions require you to purchase at least one membership share, which typically costs $5–$25. This share represents your ownership stake and is usually refundable if you leave. There is no other joining fee at most credit unions.
Can I belong to more than one credit union?
Yes. You can be a member of multiple credit unions simultaneously. Some Canadians use one for everyday banking and another for a better TFSA or mortgage rate.
Ready to Find Your Credit Union?
Browse our directory of 183+ Canadian credit unions. Filter by province, city, eligibility, rates, and digital banking quality.
This guide is for informational purposes only and does not constitute financial or legal advice. Always verify account terms, transfer procedures, and any fees directly with your financial institutions.