KOHO is dropping its free plan (but there’s a workaround)!

Two KOHO prepaid cards with arrows pointing to a choice of three plans

KOHO, the fintech known for offering one of the best prepaid cards and an app full of tools to improve your finances, no longer offers a free plan. As a reminder, to order your prepaid card, you must open a KOHO account and choose a plan. The cheapest plan is now the Essential at $4 per month, but it is still possible to get it for free.

What Are the Main Changes to KOHO Plans?

In April 2024, KOHO stopped offering the Easy plan with no monthly fees. However, customers who already have this account are expected to be able to keep it.

The other three plans retain their pricing. The company also changed its cash back rates. Plus, when you shop at partner merchants, you can now earn up to 50% extra cash back, no matter your plan. Here are the details of the changes.

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The Essential costs $4 per month. It offers 1% cash back on groceries, meals and drinks, as well as transportation (which includes public transportation, services like Uber, taxis, gas, tolls and parking). The Credit Building feature is still offered, but at $10 per month.

The Extra plan costs $9 per month, or $84 per year with a discount on the annual subscription. This plan offers 1.5% back on groceries, meals and drinks, and transportation, as well as 0.25% on all other purchases. Credit Building remains at $7 per month with the Extra.

The Everything plan offers even higher cash back: 2% on groceries, meals and drinks as well as transportation, then 0.5% on all other purchases. To strengthen your credit, you will pay $5 per month.

What Stays the Same

All plans still allow you to earn 5% interest on your entire balance, from your Spendable to your savings. KOHO also continues to offer the Canada Deposit Insurance Corporation (CDIC) protection up to $100,000. Finally, benefits such as no foreign transaction fees and one free international ATM withdrawal per month are maintained for the Extra and the Everything plans.

How to get KOHO for free?

To get the Essential without paying monthly fees, you must set up the automatic deposit of your salary or government benefits into your KOHO account. First, click on the $ symbol in the KOHO app, then on “Set up direct deposit”. On this page there is a “Share Info” button that allows you to download a form with all the information you need. Then, ask your employer to have your paycheck directly deposited into your KOHO account by giving them the form.

There is a second way to get the Essential for free. Simply transfer $1,000 or more to your KOHO account each month. For instance, you can easily do this with an Interac e-Transfer. It’s money you’ll earn interest on, and cash back when you spend it.

KOHO remains attractive despite these changes. However, we have to admit that it was more interesting when we could get it for free without conditions. With these changes, anyone who already deposits their salary elsewhere and does not have $1,000 per month to transfer to their KOHO account will be losing out.

Maude Gauthier is a journalist for Hardbacon. Since completing her Ph.D. in communications at University of Montreal, she has been writing about finance, insurance and credit cards for companies like Fonds FMOQ and Code F. As a responsible user of credit cards, she can spend hours reading the fine print to fully understand their benefits. Because of their simplicity, she developed a preference for cash back cards. After suffering steep increases with her former insurer, she can now proudly say that she saved hundreds of dollars by shopping around for her auto and home insurance. In her free time, she reads novels and enjoys streaming popular shows (and possibly less popular shows, like animal documentaries).