What is KOHO?
KOHO is a Toronto-based non-bank that offers an alternative to traditional banking. Founded in 2014 by Daniel Eberhard, KOHO launched a prepaid card linked to a mobile app in 2017. The company has since grown rapidly, with over 500,000 users across Canada. KOHO works in partnership with Peoples Trust, a bank that operates under federal regulations, to securely store the funds add to your KOHO account, which are also eligible for CDIC protection.
KOHO provides a mobile app and Prepaid Mastercard that allow you to quickly and easily manage your money on the go while earning bank-beating interest and cash back on purchases. KOHO’s mission is to help Canadians achieve financial freedom by providing us with innovative tools and resources to take control of our money.
Neo Financial is a Calgary-based fintech company that offers a robust alternative to traditional banking. They aim to provide the best possible customer experience with their user-friendly app, rewards program, and no-fee credit card. The company was founded in 2019 by Andrew Chau and Jeff Adamson, who previously co-founded SkipTheDishes together. Since then,
Neo Financial also offers both a mobile app and desktop platform, as well as a Prepaid Mastercard that earns instant cash back on eligible purchases. The
Prepaid credit cards vs traditional credit cards
KOHO provides a Prepaid Mastercard while
A prepaid card is a type of card that you load with funds in advance and then use to make purchases until the balance runs out. With a prepaid card, you can only spend the amount that has been loaded onto it.
Because you’re spending your own money, prepaid cards do not require a credit check, making them ideal for those with poor or no credit. However, using a prepaid card will have no impact on your credit score. Both the KOHO Prepaid Mastercard and the
A traditional credit card allows you to borrow money for purchases up to a certain limit, which you then pay back over time with interest. Unlike prepaid cards, traditional credit cards require a credit check and can impact your credit score if not used responsibly. On the other hand, a credit card can be a powerful tool to build or repair your credit score when used the right away.
Account features: KOHO vs
Both KOHO and
The KOHO Easy Plan is a free basic account with no monthly fees and provides free unlimited transactions for most of your daily banking needs. With KOHO, there’s no charge to pay bills, send eTransfers, withdraw from ATMs, shop online and abroad, buy crypto, fund your investment account, and more. You can also open a KOHO joint account with another person.
The Neo Financial Money Account is also free with no monthly fees and the same free unlimited transactions. But with
KOHO gives you the option to get a higher interest rate, earn more cash back, and access additional features by upgrading your account to a paid subscription plan.
In terms of accessibility, KOHO is app-based while
KOHO Prepaid Mastercard vs
Neo Money Card
Both KOHO and
KOHO allows you to personalize your card by choosing from a selection of colour options.
KOHO cash back
The KOHO Prepaid Mastercard (Easy plan) gives you 1% cash back on groceries and transportation, and you can earn up to an additional 5% cash back when you shop with a KOHO partner merchant. If you want a higher cash back rate and more eligible purchase categories, you need to upgrade to a paid subscription plan. Earned cash back is deposited into your account.
Neo Financial cash back
The Neo Money Card, on the other hand, offers a higher cash back rate and more eligible purchase opportunities. You can earn an average of 5% cash back when you shop with one of
Earning interest with KOHO vs
With the free KOHO Easy Plan, every dollar in your account earns 0.5% interest. If you want a higher interest rate you need to subscribe to a paid plan. Interest is calculated daily and deposited into your account monthly.
Neo Financial offers 2.25% interest on your deposits with no need to subscribe to a higher tier plan to get the more aggressive rate. Interest is calculated daily and deposited to your account monthly.
*Both KOHO and
Both KOHO and
The KOHO app offers a suite of tools to help you budget, save, build credit, and more. Savings features include:
- The Vault: the vault serves as a savings account separate from the regular account linked to your prepaid card. You stash money away in the Vault that you don’t want to spend, where it continues to earn 0.5-4.5% interest depending on your subscription plan.
- Goals: the Goals feature allows you to set savings goals but amount, date, or both. You can track your progress and adjust your timeline and contributions amount as needed. Unfortunately, you cannot set up automatic transfers to move money into the Vault for you. You’ll need to proactively do this yourself.
- RoundUPs: the RoundUps feature lets you save money every time you spend. You can choose to round up purchases to the nearest $1, $2, $5, or $10. KOHO will automatically deposit the extra change into the Vault for you.
Neo Financial does not offer comparable features to level up your savings rate. There’s no option to separate the money you want to save from the money you want to spend. Nor is there a comparable RounUP feature that lets you turn purchases into accelerated savings.
Both KOHO and
To help you stay on budget, both the KOHO and
KOHO takes budgeting a step further by allowing you to create and customize your budget by inputting your net monthly income, fixed expenses, variable expenses, and target spending amounts for different categories. The app will track your activity and give visual cues, like a coloured-coded progress wheel, to help keep you accountable to achieve your goals.
Neo Financial does not offer this kind of budgeting tool. Rather, you can use the
Credit building features
KOHO offers a unique subscription plan called Credit Building that allows you to (re)build your credit score without a credit card or borrowing money. For $10 a month, KOHO Easy will open a tradeline on your credit file and report your monthly subscription payments to the credit bureaus. You can cut down this fee by 50 % if you subscribe to the Everything plan.
The plan runs for 6 months and you can choose to re-subscribe to continue building your credit. You also have the choice between a recurring monthly payment out of your KOHO account or pay the full 6 months upfront.
Neo Financial does not offer a comparable credit-building feature. However,
The Neo Cash Back Rewards Mastercard requires you to apply and submit to a credit check. You can use the card to improve your credit score by paying the balance off in full every month before the due date.
If you have bad or no credit, the Neo Secured Mastercard offers guaranteed approval with no credit check, and a low minimum security deposit of just $50. The card limit is the same amount as your security deposit. You can increase your limit at any time by depositing additional security funds. Moreover,
- No annual fee
- 5% cash back on average at
- Up to 15% cash back for each first purchase at a
- 0.5% minimum average cash back guarantee
- Subscription bundles to customize your rewards & perks
- Real-time spending insights from the mobile app
KOHO additional perks
KOHO offers additional perks such as overdraft protection and expert financial advice personalized just for you. These unique benefits set KOHO apart from
The Cover feature gives you extra wiggle room for unexpected expenses with interest-free overdraft protection. For just $5 a month, you can access up to $50 to cover surprise shortfalls in your budget.
There’s no application or credit check, so there’s no impact on your credit score to use Cover.
Personal Financial Coach
With KOHO Premium, you can access professional financial advice at your fingertips with your very own financial coach! They’re like personal trainers for your wallet, helping you make smart money decisions no matter where you are. Certified and experienced, they’ll work with you to establish a budget, savings plan, and even offer tips on improving your credit score.
Plus, since your KOHO Financial Coach doesn’t manage your money for you, you can trust their advice is unbiased and transparent. Think of them as a one-stop-shop to whip your money into shape. They teach you the skills to manage your own finances like a pro.
Neo Financial additional perks
Neo Financial offers unique services like an investing platform and a mortgage marketplace. These perks are not currently available with KOHO, making
Neo Financial offers a new investing platform, called
You can set up automatic contributions from your bank account on a regular basis and
Neo Financial offers a digital mortgage platform, called
You can get pre-approved for a mortgage in minutes and receive personalized rates based on your credit score and financial situation. Once approved, you can confirm the details of the loan and sign the documents electronically without leaving the house.
What’s the verdict?
Both KOHO and
KOHO is an excellent choice if you’re looking for a quick and user-friendly way to save a ton of money on bank fees, especially if your banking needs are fairly straightforward. And KOHO is definitely the better choice for younger users and those looking to build their credit history without applying for credit.
On the other hand,
Neo Financial is an excellent choice for those who need more robust financial services outside essential day-to-day banking. If you’re looking to make your money work harder for you, then
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