Guaranteed Investment Certificate
GIC
A low-risk Canadian investment product that guarantees your principal and pays a fixed interest rate.
What is a GIC?
A Guaranteed Investment Certificate (GIC) is a Canadian investment product that guarantees your principal amount and pays a fixed or variable interest rate over a set term, typically ranging from 30 days to 5 years. GICs are considered one of the safest investments in Canada because your deposit is protected by the Canada Deposit Insurance Corporation (CDIC) up to $100,000.
Why It Matters for Newcomers
Many international students are required to purchase a GIC as part of their study permit application to demonstrate proof of financial support. The Student GIC program requires a deposit of approximately $20,635 CAD, which is released in monthly installments after arrival. GICs are also useful for newcomers looking to safely grow their savings.
How It Works
You deposit a fixed amount with a bank or financial institution for a specific term. At the end of the term, you receive your original deposit plus the interest earned. Some GICs can be cashed early, but cashable or redeemable GICs typically offer lower interest rates than locked-in ones.
Quick Tip
If you are an international student, compare Student GIC rates between major Canadian banks before purchasing. Even small differences in interest rates add up over the year when your funds are released monthly.