Neo Financial, a digital fintech company established in 2019, has quickly emerged as a notable player in the financial landscape. Despite its relatively recent inception, Neo already offers a diverse array of products, including a rewards credit card and a high-interest savings account.
For individuals seeking a rewards credit card with no annual fee and an attractive cash-back rate, Neo presents a compelling option. Additionally, its high-interest savings account boasts one of the most competitive rates available in the market, making it an enticing choice for individuals looking to allocate their emergency fund or surplus cash.
As a newcomer in the Canadian financial landscape, Neo currently offers three primary products: a high-interest savings account and two cash-back credit cards.
Another advantage of utilizing Neo is the opportunity to access their flexible high-interest savings account, enabling you to earn up to 4.00% in interest—significantly higher than what traditional savings accounts offer. Moreover, with no annual or monthly fees and no minimum balance requirements, it’s exceptionally beginner-friendly. Additionally, you’ll benefit from unlimited free transactions, ensuring you’re not subjected to fees for managing your funds.
Neo Financial also facilitates bill payments, deposits, and Interac e-Transfers® from its savings account, catering to daily spending needs. Backed by CDIC-deposit protection through Concentra, Neo ensures deposit protection of up to $100,000 per category and per depositor.
While Neo-to-Neo deposits are still in development and mobile cheque deposits are not yet supported, the savings account doesn’t offer paper cheques. Nevertheless, the main draw remains the opportunity to earn 4.00% with this flexible account.
For those seeking a card resembling a prepaid card but offering enhanced benefits, Neo presents the Neo Money™ card. Users can access funds directly from their Neo account without the need for manual loading. First-time purchases at Neo partners yield up to 15% cash back, followed by an advertised 5% cash back on average for subsequent purchases at thousands of partners. With no credit check or monthly/annual fees, users can enjoy the benefits of earning high daily interest of 2.25% while also earning cash back on their spending at 10,000+ Neo partners.
Neo Credit offers a versatile cash-back rewards card that provides an average of 5% cash back at Neo partners, subject to varying offers and partners. This card boasts no annual or account inactivity fees, and eligibility starts at a credit score of just 600+ (falling within the fair to good range).
Neo Financial collaborates with a diverse range of local and national partners spanning categories such as dining, groceries, gas, entertainment, and general shopping. Some notable national partners include Earls Kitchen + Bar, Kit & Ace, Frank And Oak, Best Western, Oxygen Yoga & Fitness, and Second Cup.
Furthermore, Neo’s local partners offer an even broader selection. For instance, in Toronto, partners include various gas stations like Esso and Shell, grocery stores like Metro, and numerous local cafes and restaurants. This comprehensive mix ensures a rewarding experience encompassing both retail and essential categories like groceries and gas.
Neo Financial partners offer up to 15% cash back as a welcome bonus for initial purchases. Upon tapping an offer in the Neo app, users can view the partner’s welcome bonus cash back rate alongside the regular rate. For instance, at a Second Cup in Toronto, the welcome bonus is 10% cash back on the first purchase, up to $5, while the normal rate is 4% back every three purchases, up to $4.25.
However, it’s important to note that partner cash back rates are subject to variability and may be lower than advertised. While Neo indicates an average of 5% partner cash back, this figure is just an average.
Cash back accumulates in the Rewards Balance tab, and users can cash out once transactions post to their credit account, with no minimum cash-out requirement. These rewards apply against the next statement payment.
In terms of interest rates, Neo Credit offers a purchase credit rate ranging from 19.99% to 26.99% (19.99% to 24.99% for Quebec residents) and a cash advance credit rate ranging from 22.99% to 28.99% (22.99% to 25.99% for Quebec residents).
Another notable feature is Neo Secured Credit, a secured credit card option designed to help users improve their credit score without requiring a credit check. Users deposit money into their Neo account to establish an equivalent credit limit. By consistently paying off the balance on time and in full each month, users can gradually enhance their credit. Live secured card transactions are reported to Transunion, with some exclusions for users with limits under $50 and those with hyphenated names.
Considering the welcome bonus and cash back potential, Neo Credit stands out as an impressive no-fee rewards card. While the partner rate surpasses that of cards like the Tangerine Money-Back Credit Card, which offers 2% cash back in two chosen categories, Neo Credit rewards may vary and be less lucrative if they fall below the advertised rate.
The Hudson’s Bay Mastercard® stands out as an excellent choice for dedicated Hudson’s Bay and thebay.com shoppers, offering a range of enticing perks:
Points earned are redeemable at Hudson’s Bay stores and thebay.com. To earn up to 4 points at Hudson’s Bay and thebay.com, an annual spending of $1,200 is required, with different reward tiers influencing rewards. However, the bottom line is that you’ll earn at least 2 points for every dollar spent in-store and online at Hudson’s Bay.
New cardholders receive a generous 15% first-day purchase bonus for Hudson’s Bay and thebay.com purchases, although certain exclusions apply. Nevertheless, this bonus is a noteworthy perk for first-time users.
Overall, the Hudson’s Bay Mastercard® offers substantial savings at Hudson’s Bay and provides more cash back compared to cards like the RBC Rewards Visa+, which offers redemption savings at Hudson’s Bay and various other brands.
Pros of Neo Financial:
Cons of Neo Financial:
Security is a paramount consideration when selecting a financial solution, particularly for online-only options like Neo Financial, which may not have the same established reputation as traditional banks.
Fortunately, Neo Financial prioritizes security through its partnership with Concentra, ensuring that your savings account funds are protected with deposit insurance—the primary safeguard for online-only financial institutions. Additionally, Neo employs stringent identity verification measures, such as capturing photos of valid Canadian driver’s licenses, passports, or permanent resident cards. Neo assures users that it utilizes cutting-edge technology to safeguard their information and only retains images for a limited period of 90 days before deletion. Moreover, users can enhance account security by setting up personalized security questions during the Neo signup process.
Neo Financial offers multiple avenues for contacting customer service. Live support is accessible seven days a week from 7:00am to 8:00pm MST. Users can reach out via email at support@neofinancial.com or by calling 1-855-636-2265. Additionally, Neo provides a financial help desk containing answers to frequently asked questions to assist users with common inquiries.
When it comes to online-only financial solutions, Neo Financial stands out as one of the top contenders. If you’re seeking a flexible savings account with a competitive rate, Neo Money is undoubtedly a valuable choice. Additionally, Neo Credit offers significant benefits for those who frequently spend at various Neo partners, with potential cash back averaging up to 4%.
However, Neo Financial falls short in comparison to traditional banks in certain areas. For instance, it currently does not offer personal loans, and lacks features like mobile cheque depositing and paper cheques. Nevertheless, Neo Financial has expanded its services to include investing and mortgages through Neo InvestTM and Neo MortgageTM respectively.
Overall, Neo Financial is a compelling option for individuals looking to avoid fees and prioritize rewards. However, for traditional banking needs, it may be worthwhile to explore other options.
Neo Financial is a relatively new entrant in the financial services sector, continually evolving and introducing new features. While Neo may not offer the same level of comprehensive services as established online options like Tangerine and EQ Bank, it excels in its current offerings and recent additions.
Notably, Neo boasts one of the highest interest rates for its high-interest savings account, coupled with the advantage of no account fees. Moreover, with impressive cash back rates available from Neo partners, users benefit from a rewarding rewards card and a flexible savings account.
To maximize rewards, users must actively spend at Neo partners. However, for individuals seeking a zero-fee online solution from a Financial Tech company offering competitive cash back and interest rates, Neo Financial emerges as an attractive choice.
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