As a Wealthsimple client, you are entitled to coverage so that your money stays your money. The funds in all of your individual and joint Cash accounts are placed in trust with multiple schedule 1, CDIC-member, regulated Canadian financial institutions. CDIC protection against the failure of these banks extends to Wealthsimple Cash account holders for up to $1,000,000 CAD across all Cash accounts.
How it works
General coverage with Wealthsimple Cash and Save accounts
Through CDIC, member financial institutions, like banks are able to insure up to $100,000 CAD per beneficiary, per institution, per deposit category. At Wealthsimple, we instead hold any balance in your Cash or Save account(s) in trust for you (which is a fancy way of saying, on your behalf) with members of the CDIC.
Increased coverage in your Cash accounts
We have partnered with a number of CDIC-member, Canadian Financial Institutions to take advantage of a combined CDIC-eligible coverage amount (up to $1,000,000 CAD) for our clients across all of their Cash accounts.
This means that we hold our clients’ Cash account balances over $100,000 CAD in trust with multiple members of the CDIC, allowing the extension of coverage to funds in your cash accounts for up to $1,000,000 CAD, against failure of any of Wealthsimple’s partner banks.
Frequently asked questions
My bank only insures my accounts up to $100,000, how are you able to offer $1,000,000 coverage?
We partner with schedule 1, CDIC-member, regulated Canadian financial institutions to take advantage of a combined CDIC eligible coverage amount (up to $1,000,000). Instead of holding your funds in trust at one partner institution, we spread funds across multiple institutions to increase your coverage.
Since Wealthsimple isn’t a bank, how are you insuring me?
As a client of Wealthsimple, you are entitled to insurance coverage so that your money stays your money. Although Wealthsimple is not a bank, we are partnering with a number of schedule 1, CDIC-member, regulated Canadian regulated financial institutions to take advantage of a combined CDIC-eligible coverage amount (up to $1,000,000) which can be enjoyed by Wealthsimple Cash clients. Wealthsimple Cash deposits over $100,000 are held in trust with these Canadian banks resulting in increased coverage on eligible deposits.
You mentioned protection for "up to $1,000,000", what if I have less than this? Is it covered?
Yes. We partner with schedule 1, CDIC-member, regulated Canadian financial institutions, meaning your funds are eligible for coverage of up to $1,000,000, which is 10x the eligible coverage of a traditional checking account.
Which partner banks are you using?
We partner with schedule 1, CDIC-member, regulated Canadian financial institutions. Due to contractual reasons, we cannot disclose the names of the partners we use.
What if my Cash balance exceeds $1,000,000?
Any amounts over your CDIC coverage are not eligible for additional coverage. Should your balance across all of your Cash accounts balance exceed your CDIC coverage, we recommend that you speak to one of our Portfolio Managers. Our Portfolio Managers are on hand to offer free financial advice at any stage and they are best positioned to advise on alternative options for your excess cash.
Why isn't Wealthsimple listed on the CDIC website?
Wealthsimple isn't a CDIC member institution, however, we partner with CDIC members to hold your cash balance in trust, ensuring coverage is passed onto you.
How are my funds split between the partner banks that you are using?
The funds are split to maximize your eligible CDIC coverage.
What about the cash I have in other Wealthsimple accounts?
The total balance of your Wealthsimple Cash accounts (including joint Cash accounts) is covered up to $1,000,000. You can learn more about the insurance available to you for your other Wealthsimple accounts by checking out this article.
Will this impact deposit or withdrawal timelines?
Deposit and withdrawal timelines will not be impacted by this initiative. Instead, you can enjoy the same deposit or withdrawal timelines with the increased security of CDIC-eligible coverage of up to $1,000,000 on your Wealthsimple Cash accounts.
What happens if Wealthsimple goes out of business?
In the improbable event that Wealthsimple goes out of business, client funds are to be recovered in accordance with Canadian bankruptcy laws and proceedings.
What about the cash I have in other Wealthsimple accounts?
The total balance of your Wealthsimple Cash accounts (including joint Cash accounts) is covered up to $1M. You can learn more about the insurance available to you for your other Wealthsimple accounts in this article.
How does coverage work for a joint Cash account?
The funds in a joint Cash account are covered under the client that opened the account (the “inviter”).
For example, client A (the “inviter”) has $600k in their individual Cash account and $1,000,000 in their joint Cash account with client B. $1M of their total balance across their Cash accounts is eligible for CDIC coverage, which means that the leftover $100k is not covered (regardless of how much client B has in their other Cash accounts).
Why don’t other banks do this?
Terms and conditions
Our Cash product is offered by Wealthsimple Investments Inc. (“WSII”), a member of the the Canadian Investment Regulatory Organization (“CIRO”), and Wealthsimple Payments Inc., a FINTRAC registered money services business. The funds added to Cash account(s) (the “Funds”) are ultimately held securely in trust in the name of the primary account holder with a single or multiple members of the Canada Deposit Insurance Corporation (“CDIC”). CDIC protects eligible deposits held at CDIC member institutions in case of a member institution’s failure. Wealthsimple Payments Inc. and WSII are not CDIC member institutions. Under the trust framework, CDIC insures eligible cash balances up to $100,000 per beneficiary, per member institution, provided certain disclosure rules are met. Coverage is free and automatic. Learn more about how CDIC protection works. Funds must be spread across at least 10 CDIC member institutions in order for up to $1,000,000 in deposits to benefit from applicable CDIC coverage. The advertised interest rate for the Cash Account is derived from interest earned by Wealthsimple on the funds. The rates are annualized rates, calculated daily, and paid monthly. Subject to change. For more information see here. The Funds are settled with any CDIC member(s) one business day following the date that Funds are reflected in the Account.
The Wealthsimple Mastercard® Prepaid card is issued by KOHO Financial Inc. pursuant to license by Mastercard International Incorporated. All terms applicable to the Cash Card and all applicable fees and transaction limits with respect to the Cash Card and the services may be found in the Wealthsimple Cash Mastercard® Prepaid Card Cardholder Agreement between you and KOHO Financial Inc. Mastercard and the circles design are registered trademarks of Mastercard International Incorporated.
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