Neo Financial Review: A No-Fuss Option for Cash Back
Neo Financial is a completely digital fintech company that began in 2019. Despite being a new company, Neo already offers a range of products including a rewards credit card and high-interest savings account.
If you’re looking for zero annual fee rewards cards with lucrative cash-back rates, Neo could be for you. Its high-interest savings account also has some of the most competitive interest rates on the market, making it a compelling account for parking your emergency fund or extra cash in.
In This Article:
Neo Financial Product Breakdown
As a relatively new player in the Canadian space, Neo only has three products on offer at the moment: a high-interest savings account and two cash back credit cards.
|Neo Financial Mastercard||Variety of partners where can earn an average 4% cashback||Shopping at non-Neo partners only pays 1% cash back|
|Neo Hudson’s Bay Mastercard||Earn bonus cash back at The Bay and free shipping on thebay.com orders over $45||Points are only redeemable at Hudson’s Bay stores and thebay.com|
|Neo High-Interest Savings Account||Earn a very competitive interest rate of 2.25% and unlimited free transactions||No sign-up cash bonus|
Neo Financial Credit Cards
Neo Financial has two no-fee rewards credit cards Canadians can take advantage of: the Neo Card and Hudson’s Bay Mastercard®. Each card pays cash back rewards, but choosing the right card largely depends on your shopping habits.
Neo Financial Mastercard®
The Neo Card is a flexible cash-back rewards card that pays an average of 4% cash back at Neo partners. That average is based on current offers at select partners and varies per offer and partner. This card doesn’t charge annual or account inactivity fees, and you’re eligible with a credit score of only 600+ (the fair to good range).
Neo has a variety of local and national partners for categories like dining, groceries, gas, entertainment, and general shopping. Some examples of popular national Neo partners include:
- Avis Car Rental
- Budget Car Rental
- Frank And Oak
- Mary Brown’s
- Uber and Uber Eats
Neo’s local partners are much more diverse. For example, in Toronto, some current partners include various gas stations like Esso and Shell, grocery stores like Metro, and dozens of local cafes and restaurants. Overall, there’s a nice mix of retailers and essentials like grocery and gas rewards you can enjoy.
Related: Best Credit Cards for Groceries
Additionally, Neo partners pay up to 15% cash back as a welcome bonus for your first purchase. When you tap on an offer in the Neo app, it displays the partner’s welcome bonus cash back rate and the normal rate. For example, 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, note that partner cash back is an average and that partners may pay less than the advertised amount. So even though Neo states you earn an average of 4% partner cash back, this is just an average.
Neo also tops up your everyday cash back rewards to 1% for up to $5,000 of spending per month at non-partners, so you still earn for everyday spending. Cash back accumulates in your Rewards Balance tab, and you can cash out once transactions post to your credit account. There’s no minimum cash out requirement and rewards apply against your next statement payment.
As for interest rates, the Neo card has a 19.99% to 24.99% purchase credit rate and a 21.99% to 26.99% cash advance credit rate.
Exclusive Offer: New Neo Financial Mastercard Cardholders receive a $25 Welcome Offer Bonus for signing up with our link. Terms and conditions apply.
One nice aspect of Neo is that you can also sign up for its Credit Builder Card instead of the regular Neo Card. This is a secured credit card that helps you improve your credit score with responsible use and doesn’t require a credit check. It has all of the perks of the regular Neo Card, but you deposit money in your Neo account to create an equal credit limit. If you pay off your balance on time and in-full each month, you can gradually build your credit.
Related: Best Credit Cards for Bad Credit
Considering the Neo Card’s welcome bonus and cash back potential, it’s an impressive no-fee rewards card. The partner rate is much higher than cards like the Tangerine Money-Back Credit Card, which pays 2% cash back in two categories of your choice. However, Neo Card rewards can be more variable and less lucrative if they pay under the advertised rate.
Hudson’s Bay Mastercard®
The Hudson’s Bay Mastercard® is another no-fee rewards card that’s an incredible choice for avid Hudson’s Bay and thebay.com shoppers.
Here are the main perks of this card:
- Earn up to 4 points on every dollar you spend in-store at the Hudson’s Bay and online at thebay.com
- Earn 2 points on every $1 you spend elsewhere
- Earn 2% cash back at Neo partners
- Get free shipping on thebay.com orders of $45 or more ($29+ on beauty orders)
Points are redeemable at Hudson’s Bay stores and thebay.com. Earning up to 4 points at Hudson’s Bay and thebay.com requires spending $1,200 annually, and there are different reward tiers that influence rewards. But the bottom line is you’re earning at least 2 points for every dollar you spend in-store and online at Hudson’s Bay.
New cardholders also get a 20% first-day purchase bonus for Hudson’s Bay and thebay.com purchases. To claim this bonus, you shop on the first day you activate your card and get 20% off your first purchases and any purchases you make until 12pm EST. There are many exclusions like certain types of appliances, so this isn’t as flexible as it seems. But for a first-time bonus, 20% is very generous.
This card has the same 19.99% to 24.99% purchase credit rate and a 21.99% to 26.99% cash advance credit rate as the Neo Card. Overall, it’s one of the best ways to save money at Hudson’s Bay and pays more cash back than cards like the RBC Rewards Visa+, which lets you redeem savings at Hudson’s Bay and numerous other brands.
Neo Financial High-Interest Savings Account
Another benefit of using Neo is gaining access to Neo Money. This flexible high-interest savings account lets you earn up to 2.25% in interest; much higher than you get with any ordinary savings account. Plus, with no annual or monthly fees and no minimum balance requirements, it’s very beginner-friendly. You also get unlimited free transactions so you’re not getting dinged with fees just for moving money around.
Related: Best High-Interest Savings Accounts
Neo also lets you pay bills, make deposits, and send or receive Interac e-Transfers from this account, so it can cover daily spending needs. Neo Money has CDIC deposit protection through Concentra. Essentially, Neo combines funds deposits at Concentra Bank, providing up to $100,000 of deposit protection, per category and per depositor.
Neo-to-Neo deposits are still in the works, and you can’t deposit mobile cheques. This savings account doesn’t have paper cheques either. But earning 2.25% with this flexible account is the main perk. It even beats interest rates from other leading Canadian high-interest savings accounts like KOHO Save, which currently pays 1.2% in interest, and EQ Bank’s Savings Plus Account which pays 1.65%* in interest.
* Interest is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.
Neo Money Interest Rate is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.
Pros & Cons Of Neo Financial
- High cash back rate at Neo partners
- Diverse range of partners
- No annual fees, monthly fees, or account minimums
- Competitive high-interest savings account
- You have to shop at Neo partners to earn the most cash back
How Secure Is Neo Financial?
Security is an important factor to consider when picking a solution for your money. This is especially true if you’re considering an online-only solution like Neo Financial since this isn’t the same as using an established traditional bank.
Thankfully, Neo Financial is secure due to its partnership with Concentra. Your savings account funds have deposit protection, which is the main protection to look for with an online-only solution from a Financial Institution. You also verify your identity by taking a photo of a valid Canadian driver’s license, passport, or permanent resident card. Neo states it uses the latest technology to keep you safe and only stores pictures for 90 days before deleting them. Furthermore, you create security questions when signing up for Neo to improve account security.
Neo Financial Customer Service
There are several options to contact Neo Financial customer service. Live support is available seven days a week from 7:00am to 8:00pm MST. You contact support by emailing [email protected] or by calling 1-855-636-2265. Neo also has a financial help desk with answers to common questions users have.
Who Should (and Shouldn’t) Consider Neo Financial?
There are plenty of online-only solutions from Financial Institutions out there, and Neo Financial is certainly one of the top contenders. If you want a flexible savings account with a competitive rate, Neo Money is definitely worth it. Additionally, the Neo Card is a worthwhile addition to your wallet if you regularly spend money at various Neo partners since you can get up to an average of 4% cash back.
Where Neo Financial falls short is with offerings you get with a traditional bank. For example, you can’t invest through your Neo account at this time or take out personal loans or a mortgage. A lack of mobile cheque depositing and paper cheques are also two small downsides.
Related: Best Personal Loans in Canada
Overall, Neo Financial is worth it if you want to avoid fees and prioritize rewards. But for traditional banking needs, other options may be worth considering.
Neo Financial is a newer player in the financial services space, so it’s still developing new features. But, while features like investing and mortgages are on Neo’s roadmap, Neo is currently quite limited. When you compare Neo to other online options like Tangerine and EQ, which both offer investing and way more account types, it’s clear that Neo isn’t nearly as comprehensive.
That said, Neo excels at the few offers it has. The high-interest savings account rate is one of the highest you can find, and you don’t have to worry about account fees. When you add in impressive cash back rates from Neo partners, you get a lucrative rewards card and flexible savings account.
You need to put in the effort to spend at Neo partners to maximize rewards. But if you want a zero-fee online solution from a Financial Tech company with competitive cash back and interest rates, Neo Financial is for you.
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Neo Card issued by ATB Financial pursuant to license by Mastercard International Inc.
Neo Money is provided by Concentra Bank.
Mastercard® is a registered trademark, and the circle design is a trademark of Mastercard International Inc.
All product and company names are trademarks or registered trademarks of their respective holders. Use of them does not imply any affiliation with or endorsement by them.
The Neo Money account is provided by Concentra Bank, a CDIC member institution, and is eligible for CDIC deposit protection. Deposits held in Neo Money accounts are combined with eligible deposits held at Concentra Bank, for up to $100,000 of deposit protection, per category, per depositor. For more information about CDIC deposit insurance, please consult CDIC’s website cdic.ca.