GIC Interest Rates Canada

Here are the best Guaranteed Investment Certificates (GICs) in Canada to help maximize your investment for a guaranteed rate of return.

Current GIC rates comparison

GIC rates vary significantly between major banks and online institutions. Online banks and credit unions typically offer the most competitive rates because of lower overhead costs. This table shows approximate GIC rates at different institution types as of early 2025.

Major bank GIC rates (approximate)

Term Big Five Banks Online Banks Credit Unions
30-day cashable 0.50% – 1.00% 2.00% – 3.00% 1.50% – 2.50%
1 year 2.75% – 3.50% 3.50% – 4.25% 3.25% – 4.00%
2 year 2.75% – 3.25% 3.25% – 4.00% 3.00% – 3.75%
3 year 2.75% – 3.25% 3.25% – 3.90% 3.00% – 3.75%
5 year 2.75% – 3.25% 3.25% – 3.75% 3.00% – 3.50%

GIC rates change frequently based on the Bank of Canada interest rate and market conditions. Always compare current rates across multiple institutions before purchasing. Use our GIC calculator to project your returns at different rates and terms.

Tip: The difference between a big bank rate and an online bank rate can add up significantly. On a $50,000 GIC, a 1% rate difference means an extra $500 per year in interest.

Historical GIC rates in Canada

These are the historical GIC rates in Canada for the 1-year and 5-year non-registered GICs.

What is a GIC?

A GIC or Guaranteed Investment Certificate is an investment that provides a guaranteed rate of return making it a great low-risk investment used by investors to diversify their portfolios.

How much will I earn with a GIC in Canada?

Your total return on a GIC is based on the interest rate that the GIC pays in addition to the period of time that it is invested for. Other factors such as compounding returns determine how much you will earn with a GIC. You can use a GIC calculator to see the growth of your investment over time.

Types of GICs in Canada

There are several types of GICs available to Canadian investors:

  • Non-redeemable GICs — These offer the highest rates but lock your money in for the full term. You cannot withdraw early without a penalty.
  • Cashable or redeemable GICs — These allow early withdrawal after a short initial period, usually 30 to 90 days. The tradeoff is a slightly lower interest rate.
  • Market-linked GICs — Your return is tied to the performance of a stock market index. Your principal is guaranteed, but returns can vary from 0% to a capped maximum.
  • Registered vs non-registered — GICs can be held inside registered accounts like a TFSA, RRSP, or FHSA to shelter or defer taxes on interest earned. Non-registered GICs have their interest fully taxed at your marginal rate.
  • Foreign currency GICs — These GICs are held in foreign currencies (typically USD) and earn interest in that currency. They are suitable for investors who need foreign currency in the future or want exposure to exchange rate movements. Returns depend on both the interest rate and currency fluctuation.

GIC laddering strategy

A GIC ladder is a strategy that spreads your investment across multiple GIC terms to balance liquidity and returns. Instead of locking all your money into one term, you divide it equally among several terms.

How a GIC ladder works

Here is an example of a $50,000 GIC ladder:

Investment Term Rate (example) Maturity
$10,000 1 year 4.00% Year 1
$10,000 2 year 3.80% Year 2
$10,000 3 year 3.70% Year 3
$10,000 4 year 3.60% Year 4
$10,000 5 year 3.50% Year 5

When the 1-year GIC matures at the end of Year 1, you reinvest that $10,000 into a new 5-year GIC. Each year, one GIC matures, giving you regular access to funds while capturing the typically higher rates offered on longer terms.

Benefits of GIC laddering

  • Regular liquidity — One GIC matures each year, so you always have access to a portion of your funds
  • Higher average returns — Longer-term GICs generally pay higher rates than short-term ones
  • Rate risk protection — If rates rise, you can reinvest maturing GICs at the new higher rate. If rates fall, your longer-term GICs are still earning the original higher rate
  • Simplicity — Once established, the ladder is easy to maintain by rolling each maturing GIC into a new 5-year term

Use our compound interest calculator to compare the total returns of a ladder versus investing the full amount in a single term.

CDIC deposit insurance

The Canada Deposit Insurance Corporation (CDIC) protects your GIC deposits at member institutions. Here is what you need to know:

  • Coverage limit — Up to $100,000 per eligible deposit category per member institution
  • Eligible deposit categories include:
    • Deposits in your name
    • Joint deposits
    • TFSA deposits
    • RRSP deposits
    • RRIF deposits
    • FHSA deposits
    • Trust deposits

This means you can have up to $100,000 insured in each of these categories at the same institution, for a potential total coverage of $700,000+ at a single CDIC member bank.

Important notes about CDIC coverage

  • GICs with terms of 5 years or less are covered. GICs longer than 5 years are not eligible.
  • Credit union deposits are not covered by CDIC — they are covered by provincial deposit insurance corporations, which often provide unlimited coverage.
  • Market-linked GICs are covered for the principal amount only if the term is 5 years or less.
  • CDIC coverage is automatic — you do not need to apply.

Verify that your institution is a CDIC member at cdic.ca before purchasing a GIC.

Where to buy GICs in Canada

You can purchase GICs from several types of financial institutions in Canada:

  • Major banks — All of Canada’s big banks offer GICs, though their rates are often lower than smaller competitors.
  • Credit unions — Provincial credit unions frequently offer competitive GIC rates and are covered by provincial deposit insurance.
  • Online banks and platforms — Digital-first banks like EQ Bank and Oaken Financial typically offer the best rates due to lower overhead costs. Online brokerages also let you compare GICs from multiple issuers in one place.

All GICs at CDIC member institutions are insured up to $100,000 per eligible deposit category.

GIC vs savings account

Both GICs and high-interest savings accounts are low-risk options, but they serve different purposes:

  • Guaranteed rate vs variable — A GIC locks in your interest rate for the full term, protecting you from rate drops. Savings account rates can change at any time.
  • Locked-in vs liquid — Most GICs require you to keep your money invested until maturity, while savings accounts allow withdrawals at any time.
  • Returns — GICs generally pay higher rates than savings accounts in exchange for reduced liquidity.

For short-term savings you may need access to, a savings account is better. For money you can set aside for six months or longer, a GIC will typically earn more. Use our compound interest calculator to see how your returns grow over time, or explore other options with our investment calculator.

GIC vs. HISA vs. bonds

All three are relatively low-risk investments, but they have important differences.

Feature GIC High-Interest Savings Account (HISA) Bonds
Risk Very low (principal guaranteed) Very low (principal guaranteed) Low to moderate (price fluctuates)
Return Fixed rate, locked in Variable rate, can change anytime Fixed coupon, but price varies with rates
Liquidity Low (locked until maturity, unless cashable) High (withdraw anytime) Moderate (can sell before maturity, but price may vary)
CDIC insured Yes (up to $100K, terms ≤5 years) Yes (up to $100K) No (but government bonds have sovereign backing)
Best for Money you won’t need for 1–5 years Emergency fund, short-term savings Portfolio diversification, income generation
Tax treatment Interest fully taxable (unless in registered account) Interest fully taxable (unless in registered account) Interest fully taxable; capital gains on price changes are 50% taxable

When to choose each

  • GIC — Best when you want guaranteed returns and can lock up your money. Ideal in a falling rate environment to lock in higher rates.
  • HISA — Best for emergency funds and money you need on short notice. Choose this when rates are rising, as HISA rates tend to increase over time.
  • Bonds — Best for portfolio diversification and for investors who want the flexibility to sell before maturity. Bond prices rise when interest rates fall, which can provide capital gains.

Where to hold GICs: tax implications

Where you hold your GIC makes a significant difference in your after-tax return. GIC interest is taxed as regular income — the least tax-efficient form of investment income. This table shows the after-tax return on a 4.00% GIC for someone in a 40% marginal tax bracket.

Account Type Tax Treatment After-Tax Return on 4.00% GIC
TFSA Tax-free (no tax on interest) 4.00%
RRSP Tax-deferred (taxed on withdrawal) 4.00% (while in the account)
FHSA Tax-free (for home purchase) or tax-deferred 4.00%
RESP Tax-deferred (taxed in student’s hands) 4.00% (in account)
Non-registered Fully taxable at marginal rate 2.40% (at 40% marginal rate)
  1. Fill your TFSA first — GIC interest earned in a TFSA is completely tax-free, forever. This is the best place for GICs if you have contribution room.
  2. Use your RRSP next — GIC interest in an RRSP is tax-deferred. You get a deduction on the contribution and pay tax only on withdrawal, ideally in retirement when you are in a lower tax bracket.
  3. Consider an FHSA — If you are saving for your first home, the FHSA offers both a tax deduction on contributions and tax-free withdrawals for a home purchase.
  4. Non-registered as a last resort — Only hold GICs in a non-registered account after registered accounts are full. The tax drag significantly reduces your effective return.