NSF Fees in Canada: What NSF Means, the Federal Limits and Fees by Bank

NSF stands for non-sufficient funds. FCAC says a financial institution may charge non-sufficient funds (NSF) fees when there is not enough money in the account to cover a transaction, like a cheque or pre-authorized debit. FCAC says a federally regulated bank or credit union cannot charge more than $10 in NSF fees when the account lacks money for a payment, NSF fees more than once per account in a period of 2 business days, or NSF fees when the overdraft is less than $10. The federal limits in full and who they cover, each institution’s own fee and what a payee may charge follow.

What are the federal limits on a bank’s NSF fee?

The limits are in the federal consumer-protection regulations made under the Bank Act; the conditions below state them, with FCAC’s own wording beside the regulation’s.

• A bank may charge a natural person no more than $10 when the person does not have enough funds in their personal deposit account to cover a payment to be drawn from that account.
• A bank must not impose a non-sufficient funds charge more than once within a period of two business days on the same personal deposit account.
• A bank must not impose a non-sufficient funds charge on a personal deposit account that is in unauthorized overdraft by less than $10.
• A personal deposit account is a deposit account in the name of one or more natural persons that is kept by them other than for business purposes.
• The two-business-day limit applies account by account: a second account at the same bank, or an account at another bank, can be charged within the same two business days.

Who the limits cover, in the federal government’s analysis and in FCAC’s words:

• The measures apply to each personal deposit account of a natural person, including an account held jointly with another person, but not to corporations, business accounts, or fees such as dishonoured payment fees charged by merchants, lenders or other fund recipients.
• The federal government's analysis says the Bank Act and the regulations made under it apply to banks, including federally regulated credit unions, and to authorized foreign banks, and not to other federally or provincially regulated financial institutions such as provincially regulated credit unions.
• The same analysis says provincially regulated credit unions are not subject to these regulations.
• The federal government's analysis says the regulations apply to the three federally regulated credit unions.
• FCAC says the limits only apply to personal deposit accounts and do not apply to business accounts.

Where the limits come from, and when they took effect:

• The limits are section 10.1 of the Financial Consumer Protection Framework Regulations (SOR/2021-181), added by the Regulations Amending the Financial Consumer Protection Framework Regulations (SOR/2025-96), which the Governor in Council made under paragraph 627.998(e) of the Bank Act.
• SOR/2025-96 was registered on March 12, 2025 and published in the Canada Gazette, Part II, on March 26, 2025.
• The regulations came into force on the first anniversary of the day they were registered, which was March 12, 2026.
• FCAC's news release of March 12, 2026 says the regulations capping NSF fees at $10 come into force that day.
• Before the regulations came into force, FCAC says NSF fees typically ranged from $45 to $48 and were often applied whatever the size of the shortfall, and could be charged in rapid succession.
• FCAC says it will oversee industry compliance with the new NSF fee requirements.

The federal government's impact analysis statement for the NSF regulations says the government announced in Budget 2024 that the additional measures would include requiring consumers to be alerted and given a grace period to deposit additional funds, and that the requirement for banks to provide an alert and grace period was removed from the final regulations.

How overdraft protection is priced, with its own fees and interest, is on overdraft protection.

NSF fees by institution

Each row is one institution’s own NSF fee and the conditions it states, in its own words from its fee document or page; a condition in a row is the institution’s term, not the federal rule’s, and which institutions the rule covers is what the list above says, not this table.

A dash means this table shows nothing for that cell.

Checked against each institution's pages between October 20, 2026 and October 21, 2026.

Institutions in this table: BMO, CIBC, Desjardins, EQ Bank, Manulife Bank, National Bank, Neo Financial, RBC, Scotiabank, Simplii Financial, Tangerine, TD and Wealthsimple.

Other fees by institution are on bank fees compared, and overdraft fees on overdraft protection by institution.

Who can charge a fee when a payment bounces?

The fee your own institution charges is the one in the table above; at a bank, on a personal deposit account, it is the charge the federal limits above apply to.

The federal government's impact analysis statement for the NSF regulations says merchants or other fund recipients may also charge a dishonoured cheque or deposit fee in addition to the bank's NSF fee; merchant dishonoured payment fees tend to be in the range of $20 to $40, and the federal government's own administrative charges under the Interest and Administrative Charges Regulations are $15, or $25 where the amount would need to be sent to a third party by the government once paid. The federal government's analysis says the fees merchants or other fund recipients charge for a dishonoured payment are typically regulated at the provincial level. The federal government's impact analysis statement for the NSF regulations says the federal Criminal Interest Rate Regulations set an additional condition on payday loans that effectively caps at $20 the dishonoured payment fees charged by payday lenders subject to those regulations.

One province’s rule for one kind of payee, Ontario residential tenancies: Ontario's regulation O. Reg. 516/06 under the Residential Tenancies Act, 2006 exempts from the Act's bans on additional charges in s. 134(1) (landlords) and s. 134(3) (tenants and people acting for them): payment of NSF charges charged by a financial institution to the landlord, and payment of an administration charge, not greater than $20, for an NSF cheque; it covers Ontario residential tenancies only.

An institution may also charge the person who deposited a cheque that is returned; two institutions’ own fee documents list a charge of that kind, one of them for a returned foreign deposit:

• RBC Royal Bank, Item deposited or cashed that is returned unpaid (chargeback): $7.00 chargeback for an item deposited or cashed that is returned unpaid; RBC's footnote on the charge: no charge on the VIP Operating and VIP Companion Accounts, and all accounts must be in the same geographic location
• TD Canada Trust, Returned foreign deposits: $15.00; TD's note: if the cheque you deposited is in a different currency from the currency of your account, TD purchases the other currency from you at the exchange rate it sets when the deposit is returned

Can an NSF fee be avoided or reversed?

The federal government’s analysis of March 2025 described the practice before the rule: The federal government's impact analysis statement says many banks already offered flexibility to avoid NSF fees: some large banks offer a grace period (usually within a few hours or the same day) that lets a customer have an NSF fee reversed or waived if they add funds to the account to reverse a declined payment, others waive NSF fees case by case (some once per year), and others waive them when the amount overdrawn is nominal (for example, under $10).

Other pages cover what else bears on an NSF fee:

• the low-balance alert, on low-balance alerts;
• overdraft protection, which has costs of its own;
• stopping a cheque, on how to stop a cheque, and a pre-authorized debit, on cancelling a pre-authorized debit (one that broke its agreement: getting money back);
• how a complaint about a fee is taken to the institution and beyond it, on bank complaints.

Overdraft protection and NSF fees

FCAC says that if you do not have overdraft protection and cannot cover a transaction, some financial institutions might allow it and charge a small fee (an overdraft courtesy fee, ad-hoc fee or casual overdraft fee), which can help you avoid a more expensive NSF fee; the fee may be charged only the first time, and you may have to pay an NSF fee if you go into overdraft a second time without overdraft protection; what happens without overdraft protection is on overdraft protection.

The federal government's impact analysis statement for the NSF regulations says banks offer overdraft protection typically for a nominal fee plus interest on the overdrawn amount, that it is a credit product not every customer is granted, and that someone with overdraft protection can still be charged an NSF fee if they are overdrawn past their limit.

What happens if you write a cheque that bounces?

When a cheque is dishonoured because the account lacks the funds, the fees that can follow, from your own institution and from the payee, are set out above; why a cheque can be dishonoured is on what happens when a cheque bounces.

A cheque someone deposited that is later returned is covered on cheque holds, and depositing the same cheque twice on depositing a cheque twice.

The Criminal Code’s own text on cheques, which a court applies case by case, is:

• Criminal Code s. 362(1) makes it an offence to obtain by a false pretence anything in respect of which theft may be committed (or cause it to be delivered to another person), or to obtain credit by a false pretence or by fraud.
• Criminal Code s. 362(4): in proceedings under paragraph 362(1)(a), where it is shown that anything was obtained by means of a cheque that, when presented for payment within a reasonable time, was dishonoured on the ground that no funds or insufficient funds were on deposit, it is presumed to have been obtained by a false pretence, unless the court is satisfied by evidence that when the accused issued the cheque he believed on reasonable grounds that it would be honoured if presented for payment within a reasonable time after it was issued.

Related pages

• Overdraft protection
• Bank fees in Canada
• ATM fees
• Cheques
• Depositing cheques and cash
• Pre-authorized debits
• Bank drafts and certified cheques
• Bank complaints
• Credit card fees
• Each card’s fee compared