KOHO Vs EQ Bank 2021 [Complete Comparison Guide]

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Digital Banks have been on the rise as of recently. EQ Bank is one of those digital banks and it’s also one of the many contenders in a battle to become Canada’s first-ever domestically issued digital bank, with KOHO being another player in the field. Despite having some similarities, both products have different features that set them apart from each other.

Let us review both the banks individually and then compare them:

KOHO

KOHO is a prepaid Mastercard designed to be an alternative to traditional bank accounts. KOHO is currently in the Beta testing stage and is expected to go public at some point this year.

KOHO’s most unique feature is its ability to pay bills via Interac e-transfer, allowing KOHO cardholders to pay their bills just as if their KOHO card was a bank account.

KOHO also has no fees, making it much cheaper to operate than traditional banks. KOHO works by keeping users money in a pooled account where financial institutions pay interest for lending the money out to KOHO cardholders.

KOHO essentially acts as an intermediary between its customers and the KOHO cardholders that KOHO has partnered with. KOHO limits KOHO cardholders to transactions of $1,000 per day in order to protect KOHO users from spending beyond their means.

KOHO does provide KOHO cardholders with the ability to freeze KOHO cards at any time should KOHO users lose their KOHO cards or require a KOHO card suspension.

KOHO is able to provide such competitive services by having lower costs than traditional banks do, as KOHO charges only $1/month for KOHO cards and KOHO users do not have to pay transaction fees on any of the purchases they make with KOHO.

KOHO has no ATM network, meaning that KOHO uses a combination of its own prepaid KOHO card and partner bank Mastercards as a way to access cash without having to charge KOHO cardholders for using KOHO ATMs.

KOHO aims to make KOHO completely free of transaction fees by the end of 2017. KOHO does not require KOHO users to pay fees when depositing and withdrawing money, which is a service that traditional banks usually charge KOHO customers for.

However, KOHO makes KOHO users pay KOHO a 10% KOHO fee on all KOHO card withdrawals. KOHO also requires KOHO users to pay a 1.75% KOHO fee on any purchases they make with their KOHO cards that are not done via Interac e-transfer or cash KOHO cards.

KOHO has partnered with Scotiabank and KOHO users are able to deposit funds into KOHO via Scotia online or at any of its 3,500 branches across Canada.

KOHO is currently working on partnering with more banks in the near future that will allow KOHO cardholders to deposit funds KOHO cards via KOHO’s website. KOHO users are able to withdraw cash KOHO cards at any ECS or MoneyMart locations in Canada without having to pay KOHO a KOHO withdrawal fee.

Pros and Cons of KOHO

PROS

Cheaper

KOHO is cheaper to operate than traditional banks. KOHO charges no fees, making it much cheaper to use KOHO. Most KOHO transactions are not subject to a fee.

Savings

KOHO provides huge savings in comparison to traditional banks. Charges no fees for traditional bank services such as maintaining an account, depositing, and withdrawing money from ATMs Provides free ATM withdrawals.

Ease of Use

Tracking income and expenses is easier with online banking because no more bank lines.

CONS

No ATM network

KOHO does not have a physical ATM network, which means that if users lose their KOHO cards or require a card suspension, they can only access funds via the Scotia deposit program.

Fee for Card Withdrawl

A fee is charged for card withdrawals of more than $100. Currently, only 3,500 Scotiabank locations participate in the Scotia deposit program. A fee is charged for depositing money into KOHO via the Scotia deposit program.

Do not accept Cash Deposits

ECS/MoneyMart locations that sell KOHOs do not accept cash deposits.

Loss of Card

Users are unable to deposit money into their accounts when their cards are suspended or lost, which means KOHO users are unable to access their KOHOs account.

EQ Digital Bank

The EQ Digital Bank was opened for business on April 1, 2017. EQ Digital Bank officially launched on October 21st, 2017 to the general public. EQ Digital Bank is a part of EQ Group LLC which includes EQ Money Transfer.

EQ Money Transfer has been providing money transfer services since 2000 to over 50 countries worldwide. EQ Money Express is one of EQ Money Transfer’s brands. EQ Money Express was founded in 2004 and is based out of New York City, USA.

EQ Digital Bank has been set up as an FDIC-insured member of the EQ Group LLC which includes EQ Money Transfer. EQ Digital Banks’ mission statement is to “provide clients with complete digital banking solutions for their mobile devices.”

EQ Digital Bank’s goal is to put the power of financial tools in the hands of anyone, anywhere. EQ Digital Bank offers fast and simple money transfers right from your mobile device.

EQ Digital Bank gives you access to your accounts 24 hours a day 7 days a week via just one screen touch. EQ Digital Bank has over 25,000 ATMs in EQ Money Transfer’s worldwide coverage.

EQ Digital Bank also gives anyone the ability to open an EQ Savings Account. EQ Savings Accounts offer you a 1% interest rate on any money that is deposited into your EQ Savings Account.

EQ Digital Bank provides its members with EQ Savings Accounts that pay a 1% interest rate on any money that is deposited into your EQ Savings Account. EQ Digital Banks mobile app makes it possible for EQ Bank’s clients to transfer money and manage their financial accounts anywhere at any time. EQ Digital Bank also offers EQ Money Transfer services to its members as well as EQ Prepaid Mastercard.

PROS and CONS of EQ Bank

PROS

Instant Notifications

Instant transaction notifications, anytime. EQ Digital Bank offers the ability to receive instant transaction notifications any time your EQ Digital Bank is accessed.

Mobile App

EQ Bank also gives you the ability to set up and manage EQ Money Transfer services right from the EQ Digital Banks EQ Mobile app.

Unlimited Withdrawl

Unlimited ATM withdrawals from anywhere in the world, EQ MasterCard’s gives EQ Digital Bank unlimited ATM withdrawals from EQ Group LLC’s worldwide network of over 25,000 ATMs. EQ Savings Accounts also have the ability to withdraw up to $5,000 per transaction and a daily ATM withdrawal limit of $500.

Fast and Secure

EQ Money Express money transfers EQ Money Express offers fast and secure money transfers right from your EQ Savings Account EQ Money Express money transfers are available in over 70 countries worldwide.

CONS

No Bank Integration

EQ Digital Banks EQ MasterCard is not bank integrated, meaning that EQ Money Express transactions cannot be linked to your EQ Savings Account or EQ Checking Account which can cause complications when EQ Digital Bank members wish to transfer money from their EQ Money Transfer account onto their EQ savings account and/or their EQ Checking account.

Geographical restrictions

EQ Digital Bank restricts EQ Money Transactions to countries where EQ Group LLC has coverage, which includes over 70 countries worldwide. This means that EQ Money Express transactions cannot be performed in countries where EQ Digital Bank and EQ Group LLC do not have any coverage.

Commission Fees for Money Transfers

Effective from April 1st, 2017, Commission fees for all EQ Money Transfers have increased to a flat rate of $4.99 for any EQ Money Transfer under the EQ Money Express brand.

Lack of Bank partnerships

EQ Digital Bank does not have any bank partnerships which can cause complications to EQ Money Transfer members, especially when EQ Money Express wants to transfer money from their EQ Money Transfer account onto their EQ Savings Account and/or EQ Checking Account.

KOHO Vs. EQ Bank

The following are the points of differences between Koho and EQ

International Bank Integration

EQ Money Express offers fast and secure money transfers right from your EQ Digital Bank EQ MasterCard EQ Money Express money transfers are available in over 70 countries worldwide whereas KOHO has the ability to transfer money globally, anywhere at any time.

Unlike EQ Money Transfer, KOHO is bank integrated which means that users have access to their funds immediately after they have been transferred into KOHO.

Registration and Public Listing

EQ Digital Bank EQ Group LLC is registered with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) while KOHO is not. EQ Digital Bank EQ Group LLC is also listed on EQ Money Express’ website, whereas KOHO doesn’t have a public company listing.

Security

EQ offers the safest, most secure way to transfer money anywhere in the world with an EQ Money Express. EQ Savings Accounts offer clients 24/7 security monitoring and bank-level protection against fraud and theft while KOHO is fully insured by global insurance underwriters, so your funds are always safe.

Cost

Digital Bank EQ MasterCard offers its users an EQ Money Express account which charges a weekly payment limit of $5,000 and withdrawal limits from a worldwide network of over 25,000 ATMs whereas KOHO allows you to transfer money at anytime anywhere without geographical restrictions, bank integration being one of the most significant pros for KOHO.

Customer Support

EQ Digital Bank offers its users live to chat with an EQ Customer Service Representative whereas KOHO doesn’t offer live chat with a customer service representative.

Services Offered

Money Express also offers EQ Cash and EQ Personal ATM Cards, EQ Credit Cards, and EQ Mortgage Loans whereas KOHO only offers its users the ability to transfer money.

EQ Money Transfer also offers access to EQ Mobile Banking App and EQ Debit MasterCard whereas KOHO does not offer its users either of these two services.

EQ Money Transfer also offers EQ Direct Deposit which allows EQ Client’s salary to be deposited directly into their EQ account without any need for costly cheque, while KOHO doesn’t offer its users this service.

Pre-authorized Payments

Money Express also offers EQ Pre-authorized Payments for EQ Client’s EQ Account whereas KOHO does not offer its users this service. EQ Client allows EQ Money Transfers to save time and money by setting EQ Pre-authorized Payments for recurring bills such Mortgage, Telephone/Internet, Insurance, Credit Cards, etc.

This means that you do not have to manually pay your EQ Mortgage Payment each month since it will be automatically deducted from your checking account. EQ Pre-authorized will be deducted from your EQ checking account.

Money Deposit

EQ Money Express also allows their clients to deposit Canadian and US EQ Money at any EQ MasterCard ATM as well as EQ Agent locations by using the EQ Deposit Slip as well as at their EQ Banking Center whereas KOHO does not offer this service.

Collateral eSignature Deposit

EQ also offers EQ Client’s EQ Collateral eSignature Deposit which is a new EQ Deposit method that allows EQ Clients to deposit funds into EQ Account without leaving their EQ Banking Centre whereas KOHO does not offer this service.

Money Transfer Efficiency

KOHO is a Bank-Integrated solution. This means that KOHO Clients have access to their funds immediately after being transferred into KOHO whereas EQ Clients must wait 1 business day before having access to their EQ Account Funds.

This reduces KOHO transaction time from a few hours or a couple of days to just seconds. EQ cannot compete with KOHO in terms of speed, convenience, and security.

EQ Money Express charges fees for their services which means that longer KOHO transaction times mean more costs for clients when it comes to money transfers.

Operating Hours

EQ Money Express is open 24/7/365 days a year whereas KOHO’s operating hours are 9 AM – 4 PM Eastern Standard Time, Monday through Friday except for holidays whereas EQ’s Operating Hours are 24/7/365 making EQ more convenient for clients to transfer funds during non-traditional banking hours.

Technology

EQ Money Express is a web-based solution whereas KOHO’s platform is a mobile application. EQ cannot compete with KOHO in terms of technology as EQ does not offer its users a Mobile Banking App. EQ

Ease of Use

EQ Money Transfer does not have an EQ Mobile Banking App which requires EQ Clients to access EQ’s platform either on a computer or tablet whereas KOHO offers EQ clients the ability to conveniently transfer funds anywhere and at any time with the use of their mobile app.

Data Security

KOHO uses the latest in Data Security technology where data is hashed using the 256-bit industry-leading Secure Hash Algorithm (SHA-256) whereas EQ does not offer its users this level of Data Security.

Detail Oriented

KOHO does not ask for customers’ personal information when sending money online, while EQ requires you to enter your name, account number, and other personal information to complete a transaction.

Conclusion

EQ Money Express is not a bad service but it cannot compete with KOHO when it comes to technology, ease of use, and security. EQ is simply limited in comparison to KOHO so if you are looking for the best money transfer solution then you should consider banking your funds at KOHO where speed, convenience, cost-efficiency, and security are top priorities.

EQ Money Express is a solution that offers EQ’ Clients nothing more than what EQ currently offered before KOHO’s launch into the market in terms of online funds transfers. EQ has tried to compete with KOHO but they simply cannot, at least not for now.

EQ has always been behind KOHO when it comes to Industry standards and EQ continues to fall short with its EQ Money Express solution.

EQ will need to create an EQ Mobile Banking App if they want to compete against KOHO for now and in the future as EQ simply cannot compete with KOHO’s speed, convenience, and security.

I lead product content strategy for SaltMoney. Additionally, I’m helping our broader team of 4 evolve into a mature content strategy practice with the right documentation and processes to deliver quality work. Prior to Instacart, I was a content strategy lead at Uber Eats and Facebook. Before that, I was a content strategist at SapientNitro, helping major Fortune 500 brands create better, more useful digital content.

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