Guide to the Best 2025 GIC Rates in Canada

Most financial institutions offer GICs, but they all come at different rates. When searching for a GIC, it’s important to do your research. With so many different rates to choose from, you want to be sure you’re getting the best one out there. 

What are GICs?

The simplest way to describe a GIC is that it’s a loan to a financial institution that’s set up like term deposits. Your money is invested at a guaranteed rate for a predetermined period of time. Once the term of the GIC is over, you’ll receive your initial deposit back along with the interest you earned. The type of GIC that you choose will determine whether you earn using fixed-rate GICs or variable-rate GICs. With a fixed rate, you’ll know exactly how much interest is calculated since these are a form of fixed-income securities. 

What makes GICs different from other forms of investing is that deposits up to $100,000 are covered by the CDIC (Canada Deposit Insurance Corporation). Stocks and other forms of investments aren’t covered. 

What Influences Them?

Like other interest rates in Canada, rates for GICs are influenced by the Bank of Canada’s Prime Rate (policy interest rate). When the Bank of Canada increases its policy interest rate, GIC rates will increase, but they will also decrease as prime rates reduce, since this directly affects the financial institution’s prime rate. These rates are evaluated around 8 times per year, so they can change quite often. However, the rate you lock in will stay that rate for your entire term, unless you opt for a variable rate. 

Another thing that will influence your rate is the specifics of the GIC. This means that whether the GIC is redeemable or non-redeemable, the term length, and the financial institution holding the GIC will all influence the rate. This is because GICs are a competitive market so financial institutions will compete for your business. 

Bonds Vs GICs

While Bonds and GICs are similar, they also have some specific characteristics that differentiate them. The first is that GICs are guaranteed insured investments with a specific term requirement. Bonds can be bought and sold at any time, even before they mature. 

Another difference that you have to account for is the interest rates. As interest rates rise, GIC rates rise. With bonds, the price falls when interest rates rise. This would mean that you would incur a gain with a GIC and a loss with a bond if you sold during this time. 

The main similarity between bonds and GICs is that they’re both technically considered financial loans. While GICs are loaned to financial institutions, funds from bonds are loaned to the company from which you purchased the bond. 

GICs: Are They Risky or Safe?

Compared to other forms of investing, GICs are actually considered to be very safe since you earn guaranteed interest, which is known as maturity interest on GIC investments. While you do incur some risk with market-linked GICs, the standard term GIC has almost no risk at all. The only risk is if the bank goes under, and even then, you’re covered for up to $100,000 with CDIC insurance. 

However, when you put your funds into a GIC, you have to remember that it’s not a savings account and you can’t withdraw funds whenever you choose. In fact, there may be a penalty for withdrawing early, or you may not be able to withdraw early at all. It depends on the type of GIC and the frequency of investment payments. 

Best GIC Rates by Major Banks

While pretty much every financial institution will offer some form of GIC, the rates out there are pretty competitive. Let’s take a look at some of these GIC interest rates with major banks and how they work. 

BMO

Like most financial institutions, BMO offers a wide variety of GIC rates. One of their most popular GIC terms is the 12-month BMO GIC. Since this term is only one year, it provides a great rate for a short period of time. It’s 100% principal-protected and is eligible for CDIC Insurance. However, if you’re looking for a longer-term investment with the same protection, then a good option is the 5-Year BMO GIC at 3.000%. 

If you’re looking for a riskier, market-linked investment, then there’s the BMO Blue Chip GIC. This can earn you up to 40.0% based on the market. However, your principal investment is 100% guaranteed, and there’s a guaranteed minimum rate of return of 2.50% after 5 years. 

These are just the featured and more popular GICs; there are a bunch more with different terms and rates. However, these are non-cashable GICs and can’t be cashed out before the term ends. The term end date is based on your purchase date, and the interest payment options for your annual rate are based on BMO's policy.

TD

TD also offers a wide variety of GICs and GIC rates. Currently, they have a 100-Day TD Special Offer GIC that will automatically renew after 100 days. The current rate for this GIC is 2.25% and the minimum investment amount is $1,000. This GIC is cashable after 30 days; however, the minimum cashable amount is $1,000, with $1,000 remaining in the GIC.  

Another special offer is the TD Special Offer GICs, which are non-cashable. There’s a 14-month term at 3%, and an 18-month term at 3%. The minimum deposit amount is between $500 and $1000, depending on the account. This one also has the auto-renewal option. 

If you’re searching for a longer-term GIC, there’s the TD 3-Year Premium Rate Cashable GIC. You can redeem this account early; however, redemptions prior to 91 days pay no interest. There’s a minimum redemption amount of $1,000 and a minimum remaining balance of $1,000. The minimum investment amount is $500 or $1,000, depending on the account that you choose.

Here’s a look at some of the other rates that TD offers. 

Now, let’s take a look at the non-cashable GICs. 

RBC

RBC offers three different types of GICs: Guaranteed Return GICs, Interest Linked GICs, and Equity-Linked GICs. Currently, they also have some special rate GICs. There’s a 1-year cashable GIC at 2.15%, a 1-year non-redeemable GIC at 2.80%, a  2-year non-redeemable GIC at 2.85%, and a 5-year non-redeemable GIC at 3.00%.

Here’s a look at some other RBC GIC rates.

Guaranteed Return GICs

With this type of GIC, the minimum investment amount is based on the type of account you’re investing in and when. It ranges from $500 to $100,000. The terms range anywhere from 1 day to 10 years. All terms less than one year are payable at maturity, and terms greater than one year can be paid at their maturity date, monthly, semi-annually, and even annually. Both your principal investment and interest are guaranteed. 

They also have a few more special rates you can ask about if you choose to get a GIC with RBC. 

Interest-Rate Linked GICs

These types of GICs guarantee your principal amount but have a variable interest rate instead of a fixed interest rate. This variable interest rate is linked to any changes in the RBC's Prime Rate, which is affected by the BOC's Prime Rate. 

Equity Linked GICs

These types of GICs offer a guaranteed investment, but allow you the flexibility of earning more by having a stake in the market. Here’s a look at the rates.

CIBC

CIBC is another bank that offers a variety of GICs. That said, they currently have 5 different GICs that have a promotional rate. Let’s take a look at those. 

CIBC Variable Rate GIC

This is a one-year GIC with a minimum investment amount of $1,000. It has a posted rate of 2.25% and a rate of 2.50%. This is also a cashable GIC but the interest rate is linked to CIBCs prime rate, meaning it can fluctuate throughout the term. 

Since this is a cashable GIC, you can cash out at any time. However, you will be paid no interest if you cash out in the first 29 days. After that, you’ll be paid interest up until the day you withdraw. If you choose to leave it until maturity, you can choose to have it automatically renewed.  

CIBC Bonus Rate GIC - 1 Year

For the one-year term bonus rate, you can get a rate of 3.00%, but they have terms ranging from 1 to 5 years. Since this is a non-redeemable GIC, you only earn interest paid at maturity of the investment. You can also choose to automatically renew once the term is up and you’ve received your interest payment. 

CIBC Bonus Rate TFSA GIC

These rates are based on the term that you choose. They range from 3.00% in 1 year to 3.25% in 5 years. This GIC is also non-redeemable, so no interest is available until maturity. You can also choose to automatically renew at maturity. If you choose to transfer to another institution before the term ends, you won’t receive any interest and will be charged a $100 fee. 

CIBC Bonus Rate GIC - 2 Year

With the 2 Year Bonus Rate GIC, you can get 3.10%. However, you can go up to 5 years which is 3.25%. This is also non-redeemable and interest is payable upon maturity. 

CIBC Bonus Rate RRSP GIC

If you want to invest this into an RRSP, the minimum investment amount is $500. You can get them in terms of 1 year (3.00%), 2 years (3.10%), and 5 years (3.25%). If you choose to transfer before the term is up, there will be a $100 fee, and the interest won’t be paid since interest is only paid once it reaches maturity. 

Scotiabank

Scotiabank also has some great GIC options. Currently, you can get a 24-month personal redeemable GIC at 2.55%, a 2-year non-redeemable GIC at 3.35%, and a 4-year non-redeemable GIC at 3.55%. For those who have banking packages, you get a 3-year non-redeemable GIC for 3.34% or 3.44%. Those without will get a rate of 2.75%.

Here are some other rates you can get with Scotiabank.

Long-Term Non-Redeemable GICs

Short -Non-Redeemable GICs

You can also get a cashable GIC at a rate of 2.00% or market-linked GICs that range from a minimum guaranteed rate of 0.50% to a maximum rate of 55% since these rates are subject to change. 

Tangerine

Even though Tangerine isn’t a traditional bank, they do still offer registered and non-registered GICs. Their rates are also based on how long you invest the funds. Let’s take a look. 

Coast Capital Savings

One of the largest credit unions in Canada is Coast Capital Savings. With a GIC from Coast Capital Savings, the minimum deposit is only $500, you can get a registered or non-registered plan, the term ranges from 30 days to 7 years, and your initial investments are guaranteed. Here’s a look at some of their GICs.

Best GIC Rates by Term

Now that we’ve gone over some of the best rates for each bank, it’s time to look at some of the best rates based on the term. 

As you can tell, Tangerine currently has the best GIC rate in Canada. While they’re a strictly online bank, they offer a lot of the same capabilities as a traditional bank. Also, their parent company is Scotiabank, so they do have a traditional bank backing them currently. 

Is 5% A Good GIC Rate?

Generally speaking, yes, 5% is a good rate for a GIC. Currently, the best rate we see is just around 4% or lower based on the current Bank of Canada prime rate. When interest rates were higher in 2023 and 2024, it was common to see GIC rates around the 5% mark. For this reason, many people were taking advantage of GICs and their rates. 

Keep in mind, though, if you lock into an interest rate now, if it rises, you won't be able to take advantage of the new rate. However, if you don’t and the rates decrease, then you won’t be able to take advantage of the higher rate that’s available now. You have to wait until your GIC matures and you earn your annual compound interest before you can reinvest the funds. 

Is Now A Good Time to Buy a GIC?

While interest rates are in the midst of dropping, there are still some decent GIC rates out there. However, there are many investors who are choosing to invest in more lucrative short-term investments. That said, GICs still are a great short-term, low-risk investment. Even though rates are a bit lower, you can still earn some great interest on your savings. It’s a great option for those who are hesitant to invest or are new to investing. 

Account Types that you Can Invest in a GIC

When it comes to GICs, you can choose what type of account you want your investment to sit in. First, you can choose between registered and non-registered accounts. Some GICs are only available in non-registered accounts. However, some are available in registered investment accounts. Here are the registered accounts you can invest in. You’ll notice that the First Home Savings Account isn’t listed because not all institutions will allow you to invest in it. How you invest in a GIC will affect the tax implications on your bank account. 

Tax-Free Savings Account (TFSA)

A TFSA allows you to invest without having to pay any income tax on your interest earned. However, you still have to pay tax on the income that you earn to invest into the account. Because your interest income is tax-free, though, this is a popular option for GICs. You can also withdraw from a TFSA whenever you want with no penalties. 

Registered Retirement Savings Plan (RRSP)

An RRSP is a retirement savings account in which mutual funds are commonly invested. You don’t have to pay tax on the income you earn and invest until you cash in the account. This is referred to as a tax-deferred account. When you start withdrawing the funds to retire, you’ll start paying income tax on the funds based on your annual income. This should reduce your marginal tax rate since your income will be less. 

Registered Retirement Income Fund (RRIF)

An RRIF is the account you use when you’re starting to withdraw money from your registered retirement accounts. There’s a limit on how much you can withdraw in order to space out your earnings. 

Registered Education Savings Plan (RESP)

An RESP is an account that is used to save for education expenses. Once someone has reached the age of majority and is able to go to a post-secondary education, these funds can be withdrawn and used towards those expenses. Often, proof of enrollment is needed to withdraw the funds without any penalties. Since an RESP is also tax-deferred, income tax isn't paid until the funds are used. Since the payments are normally spread out and students have low incomes, the tax rate isn’t very high. 

Registered Disability Savings Plan (RDSP)

An RDSP is a savings account for those with disabilities that is created by the government of Canada. Any contributions made to this account aren’t tax-deductible and can be redeemed at the age of 59. In order to open this account, you must be approved for the Disability Tax Credit, or the person that you’re investing for must be. 

Final Thoughts

While GICs earn less interest than other forms of investing, they are a great way to increase your savings, and they are more than just a high-interest savings account. If you’re saving with a goal in mind and are able to lock away a portion of your savings, then it’s a great option. Many will just use a GIC for a portion of their savings, and then invest the rest in more redeemable options. 

If you’re new to investing, GICs are a safe way to start your investing journey while earning compound interest (simple interest is only commonly used for loans). You can start earning with as little as $500 or $1,000, and you can use these funds to save for retirement, the purchase of your first home, or even a trip or large purchase. The choice is up to you.