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Email this4:54 pm
January 14, 2026
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Neo is the user interface. The deposits are held in institutions with deposit insurance. The legal structure is more complicated than a bank, but your money is just as safe. Go get that 3%.
7:59 pm
May 15, 2007
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Note that Grant Lahring works at Neo Financial.
8:24 am
January 14, 2026
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Yes, thanks Peter. Should have clarified that. Made an account here because I saw someone having a support issue and wanted to make sure they got help. Then I saw this thread and wanted to provide some confidence.
6:54 pm
April 6, 2013
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The problem is that the confidence is false. The Neo Cash account is not a deposit, like Neo's previous savings account product was.
With the Neo Cash account, Neo is not providing just the user interface. A Neo company (Neo Financial Technologies) is providing the actual account, not a CDIC member.
The account agreement requires the account holder to acknowledge that the account is not a deposit.
11:55 am
January 14, 2026
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You can check section 8. Safeguarding of Funds of Neo Client Agreement, no problem.
8. Safeguarding of Funds
The funds you load into your Neo Cash Account ultimately become Client Trust Funds that are held in the Neo Client Trust, in trust, by the Trustee in one or more Trust Accounts with one or more Deposit-Taking Institutions, as further described in Section 7 (Trust Arrangement; Appointment of Trustee). The Trustee will determine, in its discretion, in which Trust Account(s) and at which Deposit-Taking Institution(s) your funds will be held and whether your funds are held in one or multiple Trust Accounts or at one or multiple Deposit-Taking Institutions. Each Deposit-Taking Institution is a member of CDIC. CDIC offers insurance
protection of funds as described on the CDIC website. You are eligible to receive CDIC insurance protection on up to CAD $100,000.00 of the aggregate balance of all funds that are held by the Trustee in the Neo Client Trust, in trust, on your behalf at each Deposit-Taking Institution. CDIC coverage is free and automatic, and you do not have to sign up to receive CDIC protection for the Client Trust Funds stored in your Neo Cash Account. For more information, please visit the CDIC website or contact the CDIC directly at
info@cdic.ca or 1-800-461-2342.
In plain language, Neo holds the funds in trust, with a CDIC-insured partner bank. You can see the terms in full on this page (https://www.neofinancial.com/legal)
11:18 pm
April 6, 2013
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Neo is not the trustee and does not hold the funds in trust. Olympia Trust is the trustee.
That CDIC coverage is on the balances of the deposit accounts Olympia Trust has with CDIC members.
There no CDIC coverage on the balance of the Neo Cash Account at Neo. Neo is not a CDIC member. The Neo Cash Account is not a deposit.
Would CDIC cover the shortfall should Neo fail and the total balance of the accounts Olympia Trust has with CDIC members doesn't quite come up to the total balance of all the Neo Cash Accounts at Neo?
5:42 am
March 30, 2017
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I also see in fine print there is a 3 day time delay before the deposited funds are "assigned" to one of the deposit banks. Isnt that a gap risk as well ?
5:52 am
April 21, 2022
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savemoresaveoften said
I also see in fine print there is a 3 day time delay before the deposited funds are "assigned" to one of the deposit banks. Isnt that a gap risk as well ?
What could possibly go wrong?
10:45 am
January 14, 2026
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The question I'm hearing is "What happens to my money if Neo goes bankrupt?".
The answer is "The same thing that would happen if your bank goes bankrupt — $100k is covered by CDIC insurance."
The way we secure this coverage is different than how a bank would do it — because we aren't a bank. But the protective effect to the user is the same.
We also designed this structure with further growth in mind. This is the same system our friends at Wealthsimple use for providing up to $1m in CDIC protection. It also provides more flexible economics, which we use to provide better rates. This is part of the reason we are able to offer 3% as a non-promo rate.
6:10 pm
August 4, 2010
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grantlahring said
The question I'm hearing is "What happens to my money if Neo goes bankrupt?".The answer is "The same thing that would happen if your bank goes bankrupt — $100k is covered by CDIC insurance."
This is not quite right. In the bank case, it is the bank as a single entity accepting the money and treating it as a deposit, and the CDIC guarantee is in effect if the bank is unable to disgorge the funds when required. In the Neo case these functions are divided, with Neo accepting the money, then having a separate trustee deposit it with the bank. If the bank fails as before, fine, CDIC covers it. But if Neo or their trustee fail, CDIC is not involved, and the question is whether the deposit in trust is available to hypothetical bankruptcy proceedings instead, should one or the other have a side business in Florida swamp land or shorting unobtainium futures.
I notice that CASH.TO is down to reporting a 2.15% gross yield, which presumably represents the weighted average of the rates they are getting from their deposits in National/Scotia/CIBC. Since OSFI clipped the banks' wings and made them treat those as wholesale funding, I'm guessing that individual trust deposits through Neo or Wealthsimple can still be treated as more favorable retail, and that some banks are willing to offer much higher rates on those in bulk, but >3%? Home Trust (via Oaken) is willing to offer 2.8% to individual retail customers that they have to dig up themselves, so it might be possible, I suppose.
10:13 am
January 14, 2026
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If you're up for it, I'd love for you to talk this out with our Chief Banking Officer, Tim Morris. He's in Toronto. If you need flights, I'd be happy to cover them. We have done a lot to make sure deposits are completely secure, but because we're not a bank, we do it in a different way than people may be used to. Maybe you can help us understand how to present things better or more clearly.
6:52 am
December 17, 2025
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grantlahring said
If you're up for it, I'd love for you to talk this out with our Chief Banking Officer, Tim Morris. He's in Toronto. If you need flights, I'd be happy to cover them. We have done a lot to make sure deposits are completely secure, but because we're not a bank, we do it in a different way than people may be used to. Maybe you can help us understand how to present things better or more clearly.
Would it be possible to have a Video meeting regarding this topic, and Tim Morris or someone else, answer the questions?
Please write your comments in the forum.