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We have big news! Even bigger than when lip readers guessed what Prince Harry may have said to the guy beside him at the coronation: Money in Wealthsimple Cash accounts are placed in trust with up to 3 Canada Deposit Insurance Corporation (CDIC) member institutions. This effectively extends CDIC deposit protection to Wealthsimple Cash account holders for a combined amount (up to $300,000 CAD) in the unlikely event the CDIC members were to fail.
What’s this mean for you? As a Wealthsimple customer, you don’t have to worry about the security of your money. If anything were to happen to the banks we work with (and don’t worry, the odds are low: a Canadian bank hasn’t failed since 1996), you don’t have to worry that they’ll take your money with them.
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Why are we so excited about this? Because it’s three times the coverage previously available for money held in your Cash account. Also, it’s really, really useful to you. Here’s how it works:
How your money is protected
When you deposit funds in a CDIC-member bank, they are generally eligible for insurance by the CDIC (up to $100,000 per account type at each CDIC member institution for each category). Wealthsimple is not a CDIC institution, or a bank, but the banks we partner with are tier-1 banks and CDIC member institutions. You can see the CDIC’s website for more details on how that all works.
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How we get from $100,000 to $300,000
Each account at a CDIC-member bank is eligible for up to $100,000 of deposit insurance. But since we work with multiple banks, we can stack your coverage inside a single account. Your funds are placed in trust with up to three Schedule 1 Canadian banks. That way, CDIC protection against failure of those banks extends up to $300,000 CAD.
Three banking partners x $100,000 insurance per bank = as much as $300,000 of deposit protection extends to each Wealthsimple Cash customer in the unlikely event the CDIC members were to fail.
When you put money in a Wealthsimple Cash account, we split your deposit among our bank partners. If you have $300,000 deposited with us, we send $100,000 to separate banks we work with, and you’ll see all $300,000 in your account.
How your cash account works for you
The nice thing about not having to worry about your money is you can spend your time thinking about all the other things you’d like to do with it — like spend it. If you have more than $100,000 in deposits across Wealthsimple, you qualify for 4% interest on your Cash account balance. Plus, you get access to e-transfers, direct deposits, bill payments, and more, with no fees. So, if you’re not already a customer, take a few minutes and sign up.
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