KOHO vs Neo Financial (2026): which one is actually better?

If you’re choosing between KOHO vs Neo Financial, the short answer is that Neo pays a better savings rate for free, and KOHO is the easier one to get into. Neo Savings runs 2.00% to 2.75% depending on your balance, and costs nothing. KOHO’s headline 3.5% is real, but it comes with a $22 a month plan attached, and its free tier pays 2%. Neo’s best cash-back card is free too, though it asks for an income most of KOHO’s users won’t be asked about at all.

What’s the difference between KOHO and Neo Financial?

KOHO sets your savings rate by which plan you pay for. Neo sets yours by how much you’ve already saved. KOHO puts your spending and your saving in one prepaid account; Neo keeps them apart, with a free savings account on one side and cash-back cards on the other.

KOHO is a spending app first. Everything runs through a reloadable prepaid Mastercard, and the plan you choose sets your cash back, your interest rate, and what the credit-building add-on costs. There’s a free tier, and it’s decent, but the good rate is a subscription.

Neo is closer to a savings account that grew a card business. Neo Savings pays a tiered rate at no cost and asks nothing of you: no plan, no minimum, no paycheque pointed at it. The cash back lives on separate Neo cards and leans on its partner merchants.

KOHO: how it works, and what the rate costs

KOHO has three plans. Essential is $4 a month, waived if you set up a recurring direct deposit or move $1,000 a month into the account. Extra is $18 a month and Everything is $22, or $12 and $14.75 when you pay for the year up front. The rate climbs with the plan: 2%, 2.5%, then 3.5%, per KOHO’s rates page (opens in a new tab) (as of August 2026).

KOHO’s best rate only comes with a paid plan

Everything’s 3.5% is the highest number in this comparison, and it costs $177 a year if you pay for the year up front, or $264 a year if you pay by the month. On $10,000 saved, 3.5% is $350 a year, and after the cheaper of those fees you’re keeping $173. Neo pays $250 on the same $10,000 and charges nothing. On annual billing the two only break even around $23,600 saved, and by then you should want the cash back and the perks too, not just the rate.

Cash back is where the plans earn their keep. Every tier pays on groceries, eating and drinking, and transportation, at 1% on Essential, 1.5% on Extra and 2% on Everything, with up to 6.5% extra at selected partner merchants and 0.5% on everything else at the top tier. Those are broad, everyday categories, which matters more than the headline rate.

Who holds it, and when the protection starts

KOHO isn’t a bank. It holds balances in trust with Peoples Trust, a federally regulated bank, and its security page (opens in a new tab) is specific about the condition: “once you opt-in to Earn Interest, up to $100K of your funds are eligible for CDIC protection.” So the protection is real, and it’s switched on by you rather than by default. If you’ve had a KOHO card for a while and never touched that setting, it’s worth checking. Our guide to CDIC deposit insurance covers what the coverage does and doesn’t reach.

Neo Financial: how it works, and which account pays what

Neo Savings pays 2.00% on balances up to $4,999.99, 2.50% up to $19,999.99, and 2.75% at $20,000 or more, measured across your combined Neo balance, per Neo’s rates page (opens in a new tab) (as of August 2026). There’s no monthly fee, no minimum deposit, and no lock-in. The tier moves on its own as your balance grows.

Three accounts, three very different rates

This is the trap on Neo, and it’s worth a minute. Neo Chequing pays 0.1%. An older product still named Neo High-Interest Savings pays 1.25%. Neo Savings is the one that reaches 2.75%. The names don’t tell you which is which, and a reader who opens “High-Interest Savings” expecting the advertised rate lands on less than half of it. Match the account name in the app to the one on Neo’s rates page before you move money in.

Neo’s tiers also have a quality that’s become rare. There’s no five-month teaser here that collapses afterward, which is what happens with several of the loudest offers in our roundup of the best high-interest savings accounts in Canada. What Neo quotes is what it keeps paying.

The CDIC member is Peoples Bank of Canada

Neo isn’t a bank either. Deposits sit with Peoples Bank of Canada, which is the CDIC (opens in a new tab) member, and eligible balances are covered to $100,000 per category, per depositor. Two things follow. Your Neo savings accounts share one limit rather than each getting their own, and if you already hold deposits at Peoples Bank of Canada under another brand, those count against the same $100,000.

Which is better for the higher savings rate?

Neo, for almost everyone. Free against free, Neo pays 2.50% at $10,000 where KOHO’s Essential pays 2%, and 2.75% at $20,000 where Essential still pays 2%. Neo also asks for nothing to keep it free, while KOHO’s Essential wants a direct deposit or $1,000 a month or it charges $4.

KOHO can win the rate, but only by buying it, and only at size. At $30,000 saved, Everything’s 3.5% is $1,050, and $873 after the $177 annual-billing fee, against $825 from Neo. That’s a $48 edge for a plan you have to commit to for a year. Pay monthly instead and the $264 fee puts you behind Neo again. If the rate is the only thing you’re shopping for, Neo is the straightforward answer and you can stop here.

One wrinkle worth knowing if you’re close to the line. Neo’s own tiers step up at $20,000, so between roughly $17,700 and $20,000 you’re comparing KOHO’s 3.5% against Neo’s 2.50%, and KOHO briefly comes out ahead. Neo retakes it the moment your balance crosses $20,000 and holds it until about $23,600. It’s a narrow band, but it’s enough to make a flat “KOHO wins above $20,000” false.

Which is better for everyday spending?

Neo if you can get approved for its credit card, KOHO if you can’t or don’t want one. Neo’s World Mastercard charges no annual fee and pays 2% on gas, groceries and recurring bills, which is the same headline rate KOHO charges $22 a month for. The catch is the application: Neo wants $50,000 in personal income or $80,000 household.

Clear that bar and Neo is better value on cash back alone, since you get KOHO’s top-tier rate without KOHO’s top-tier fee, plus 0.5% on everything else. Miss it, and the comparison changes completely. Neo’s everyday account card pays 1% on gas and groceries, while KOHO’s free Essential plan pays 1% across a wider set: groceries, restaurants and transportation. There’s no income test and no credit check to get it.

The categories aren’t identical either, so check them against your own month. Neo covers gas and recurring bills, which suits a driver paying for utilities and subscriptions. KOHO covers restaurants and transportation, which suits someone eating out and taking transit.

KOHO also does something Neo doesn’t try to. Round-ups push spare change into savings automatically, spending categories show where the month went, and Vaults and Goals separate money without opening another account. If you want the card and the budgeting in one place, that’s KOHO. If neither lineup fits, we’ve looked at the alternatives to KOHO and the alternatives to Neo Financial separately.

Which is better for building credit?

Neo, if you can spare a deposit. Its secured card is a genuine revolving credit line backed by refundable security funds, so the money comes back to you and you finish with a real card and a real credit history. KOHO’s Credit Building is a subscription tradeline at $5 to $10 a month depending on your plan, and that money is gone.

KOHO is the better answer for someone who can’t put a deposit down at all. There’s no security deposit and no hard credit check, so someone with no savings to lock up, or who doesn’t want a credit card in their wallet, can start today. KOHO reports to Equifax, Neo to the bureaus behind its cards, and both take months rather than weeks to show up in a score. Pick on what you can afford to tie up: a deposit you get back, or a fee you don’t.

Can you use both?

Yes, and given how differently they’re built, it’s a reasonable setup. Neo Savings is free with no minimum, and KOHO Essential is free with a direct deposit, so the pair can cost you nothing.

The split that makes sense is the one their designs suggest anyway. Savings at Neo, where the rate is free and climbs with the balance. Spending on KOHO, where the cash back covers your groceries and your commute and the round-ups fill a Vault on the side. You get Neo’s rate on the money sitting still and KOHO’s card on the money going out.

One thing to watch: KOHO’s free tier wants your direct deposit, and its interest is paid on the balance you leave in KOHO. Running it as a spending card with a low balance means you’re mostly buying cash back, not a rate, which is fine as long as that’s the plan.

Where Lodavo fits

We make Lodavo, and it works with virtually any Canadian bank or credit union. Connect a savings or chequing account there and what you save earns you free tickets in a weekly cash draw, one for every $25. Your savings stay where they are, so you keep whichever rate you just picked.

Someone wins at least $100 every week, and the jackpot runs to $10,000. You can see how each draw is run on the provably fair page, and eligibility and odds are in the contest rules.

Neither KOHO nor Neo Financial paid to appear in this comparison.

The short version

Take Neo if you want a savings rate that costs nothing and gets better as you save, and take its free 2% card too if your income clears the bar. Take KOHO if you want one app to spend from and budget in, with no income test and no credit check between you and it. The rate verdict goes to Neo, the spending verdict goes to whichever one will have you, and there’s no rule against holding both. Check the current rates on each provider’s own page before you move anything, because they change.

Terms and conditions apply. No purchase necessary (alternate method of entry available). Skill-testing question required. Open to legal residents of Canada who are the age of majority. Odds depend on the number of eligible entries received. Full rules and odds at our contest rules.