When was the last time you dealt with a teller in a bank branch? For many Canadians, the answer is "I can’t remember." Over the past decade, many of us have traded teller lineups for taps, swipes and e-transfers — we're checking balances over our morning coffee instead of waiting at a bank counter.

According to the Canadian Bankers Association (CBA), 77% of Canadians now do most of their banking digitally, while just 12% rely exclusively on brick-and-mortar branches. A KPMG survey found that three quarters of Canadians rarely step foot in a branch, with 48% going once or twice a year (or not at all). 

But this shift raises a bigger question: now that digital banking is the default for most Canadians, where does traditional branch banking still fit in?

What is digital banking?

Digital banking is a catch-all term for online and mobile banking. Instead of visiting a branch in person, you can access your account remotely and complete transactions using a computer, tablet or smartphone. No need to wait in line at a bank. It’s money management on your terms, managed through apps and websites that run 24/7. Tangerine, of course, is a primarily digital bank with a robust Contact Centre on call to help you with all your banking needs. 

What can you do with digital banking?

Digital banking puts a full toolkit at your fingertips, with features like:

• Mobile deposits. Snap a photo of your cheque and deposit it without stepping into a branch.

• Online and mobile transfers. Move money between accounts or send it across the country.

• Pay bills. Digital banking puts you in control. You can set up or schedule bill payments whenever it suits you, without being tied to branch hours — whether that’s during your lunch break or just before bed.

• Interac e-transfer^®. Instantly send money to friends, family or businesses with an email or mobile number.

• Virtual customer support. Get help through chatbots, secure messaging, phone calls or video calls from wherever you are, instead of going to a branch.

• Budgeting and financial planning tools. Track your spending, set savings goals and get automated insights into your money habits.

What’s the difference between online banking vs. digital banking?

Terms like “online banking,” “mobile banking” and “digital banking” often get tossed around interchangeably, but each describes a different way to access and manage your money.

• Online banking: Accessing your account through a web browser (desktop or laptop).

• Mobile banking. Doing your banking on an app, usually on your phone or tablet. It’s optimized for small screens, mobile deposits, biometric login, instant alerts and more.

• Digital banking. An umbrella term. Includes both mobile and online banking, plus any other digital-first services: mobile deposits, budgeting tools, chatbots, and more.

Think of it this way: Online and mobile banking are entrées, but digital banking is the full menu.

The rise of digital banking in Canada

Tangerine (formerly ING DIRECT) was one of the first trailblazers to prove a bank could thrive without branches. Launched in Canada in 1997 into a market dominated by low-interest, high-fee legacy banks, it shook up the scene by introducing a high interest account. Canadians loved it, and the bank paved the way for the digital-first banking movement in Canada.

 Fast-forward to today: most Canadians bank digitally, and mobile apps are quickly becoming the go-to choice. Every major bank offers robust online and mobile services, while fintechs keep rolling out fresh innovations. Some Canadians have even moved away from brick-and-mortar banks entirely, preferring digital banks like Tangerine.

COVID-19 sped up this online shift, and the trend hasn’t slowed. The number of Canadians who never go into a branch has doubled since the pandemic, while weekly visits plunged nearly 43%. Interac e-transfer use has almost doubled in six years, smartphone tap-to-pay is more popular than before the pandemic, and 41% of Canadians expect to use mobile banking apps even more in the next five years.

The kicker? Satisfaction with digital banking is sky-high — 97% for online, 96% for apps. What started as an experiment has become the norm: The way Canadians bank is digital-first.

Advantages of digital banking

Here’s why so many Canadians love digital banking.

• 24/7 access. Need to move money at 2 a.m.? No problem. Digital banking is always open. Tangerine is even available 24/7 by phone, so someone is always on stand-by — day or night.
• Convenience. The "bank" comes with you, tucked neatly in your pocket.
• Lower fees and competitive interest rates. Thanks in part to lower overhead, digital banks like Tangerine tend to offer lower fees or more benefits, such as no monthly fee accounts, free Interac e-transfer, lower service charges, and competitive interest rates. 
• Innovative. Digital banks typically offer cool tools to help you manage money like a boss. At Tangerine, you can set savings Goals and Money Rules, monitor spending with Tracker, and stay on budget with Left to Spend.

READ MORE: How to switch banks and start saving on fees

Comparison of digital banking vs traditional branch banking

Digital and branch banking each come with tradeoffs, which is why it can make sense to have both in your back pocket. Here’s a quick snapshot of how the two stack up, side-by-side:

Are physical bank branches still necessary?

For everyday banking, probably not. Digital banking takes care of some of the basics faster and with less hassle. But physical branches still have their uses for some people. Foot traffic may be down, but many Canadians continue to show support for keeping local branches open in their communities. 

What’s changed is their purpose. Instead of being the place for routine transactions, branches are shifting into specialized hubs that offer in-person financial advice, complex services, and face-to-face support. They can be especially vital for:

• Non-digital users: Older Canadians and individuals with specific accessibility needs may still prefer face-to-face support.
• Cash-heavy businesses: Restaurants, retailers and others handling a lot of physical currency.
• Low-connectivity regions: Rural and remote areas without reliable internet.

The future of banking in Canada

The numbers don’t lie: Canadians are all-in on digital banking. In 2024, 87% banked online and 70% used a mobile app. Still, most people aren’t ready to ditch branches entirely. That's why most banks that offer branch banking also offer digital services, and digital-first banks may offer traditional services, such as phone banking and ABMs, too. According to a report from the Canadian Bankers Association, here are some trends shaping the next generation of banking:

• Convenience is king. Most Canadians (90%) believe that new technologies have made banking a lot more convenient.

• Uptick in app use. Young adults (age 18-29) prefer banking apps, while older adults (age 70+) do more online banking.

• Electronic payments are the new norm. 40% plan to send more Interac e-transfer transactions in the next five years, while 70% expect to ditch cheques.

• Branches are becoming optional: Over a third (37%) of Canadians think they’ll stop visiting physical branches within five years.

That being said, people still want a place to go. A whopping 86% of Canadians say they value having a local branch, even if they mostly bank online or on their phone. And 56% like to visit their branch in person at least once a year for a financial check-up.

Bottom line: When it comes to banking, Canadians want the best of both worlds: quick digital solutions for everyday banking, and a place to go in person for other things.

What could banking look like in the future?

• Mobile-first everything. Whether opening an account, investing or chatting with support, expect slick app experiences empowering you to bank from anywhere.

• Interactive ABMs. The next-gen bank machines may do more than spit out bills. Picture an ABM that can pair with your smartphone to pre-load your transaction, print a new debit card on the spot, and even connect you to a live teller by video. Down the road? Expect smarter, safer machines with biometric logins, cardless transactions, and maybe even hologram ABMs for banking anywhere. Cool, right?

• Improved government and regulatory backing. Canada’s new Consumer-Driven Banking Framework (a.k.a. open banking) promises to eventually be able to help you share your financial info with trusted apps and services safely and on your terms. Everything will move through secure, government-approved connections.

Final thoughts

Bank branches are still around, but they’re no longer the backbone of everyday banking. More Canadians — especially younger ones — are already driving in the digital lane, where banking happens on phones and laptops, not at a teller counter. Digital banking is now the norm, and innovations will make in-branch visits even less necessary. Until then, however, the future looks hybrid: digital-first for speed, convenience and smarter tools, with specialized in-person hubs for those who need it.

Ready to explore everything digital banking has to offer? Start here with Tangerine.