KOHO frequently triggers the “is it safe?” question because it’s not a chartered bank, even though KOHO’s home page says 2.5M+ Canadians use it. The short answer: KOHO is safe for everyday use, but CDIC protection depends on one setting, Earn Interest. YieldMaple checked KOHO’s home and security pages on October 6, 2026; here’s the full breakdown.
What KOHO actually is (the structure that matters)
KOHO is a Canadian financial technology company, not a chartered bank. The corporate structure:
- KOHO Financial Inc. — the fintech operator. Issues the prepaid Mastercard, runs the app, manages user accounts. Per its cardholder agreement, KOHO is not a bank, and it doesn't take deposits itself.
- Partner institution — KOHO’s security page says it has partnered with Peoples Trust, which KOHO describes as a federally regulated bank to safeguard customer funds.
- CDIC — KOHO balances are eligible for CDIC protection up to $100,000 per beneficiary, per CDIC member institution, once you opt in to Earn Interest.
When you add $1,000 to KOHO, that money is safeguarded through KOHO’s partner rather than taken as a deposit by KOHO itself. Once you opt in to Earn Interest, KOHO places the funds in trust with one or more CDIC member institutions, and your CDIC eligibility flows through them.
This structure is similar to Wealthsimple Chequing, which also holds client money in trust at partner banks. The practical difference: KOHO’s CDIC eligibility depends on the Earn Interest setting, while Wealthsimple Chequing balances can be covered up to $1 million, because funds are spread across up to 10 CDIC member institutions (Wealthsimple itself is not a CDIC member).
CDIC coverage: what’s actually protected
KOHO balances are eligible for CDIC protection up to $100,000 per beneficiary, per CDIC member institution, once you opt in to Earn Interest. KOHO balances not earning interest are not eligible for CDIC protection.
CDIC is the federal Crown corporation that insures eligible deposits at member institutions. CDIC states it has 43 member failures resolved to date, affecting some two million depositors, and no one has ever lost a dollar insured by CDIC. CDIC pays out when a member institution fails; it does not insure against the failure of KOHO itself.
What CDIC does NOT cover at KOHO:
- KOHO balances that are not opted in to Earn Interest
- Funds in excess of the limit at any one member institution
- The Secured Credit Building security deposit, which is not insured by CDIC
How KOHO compares to Big 5 banks for safety
| Feature | KOHO | Big 5 bank |
|---|---|---|
| CDIC coverage | Eligible up to $100,000 per beneficiary, per CDIC member institution, once you opt in to Earn Interest | Direct member: up to $100,000 per insured category, principal and interest combined |
| Direct OSFI supervision | No (partner institution is federally regulated) | Yes (better on this row) |
| Regulator | regulated by FINTRAC as a money services business | OSFI (federal bank regulator) |
| Capital base | Private, venture-backed fintech | Large publicly traded banks |
| Branches | None | Many (better on this row) |
| Where your money sits | With partner Peoples Trust, not on KOHO's own books (better on this row) | Deposits at the bank itself |
| Major incident in last 3 years | No reported | No major |
Sources: KOHO home and security pages and CDIC, checked October 6, 2026.
The structural difference: Big 5 banks are themselves CDIC members and OSFI-regulated. KOHO relies on a partner institution for both. For everyday spending this is invisible; for savings, whether Earn Interest is switched on decides whether CDIC applies.
KOHO regulatory status
KOHO operates under multiple regulatory layers:
- FINTRAC — KOHO is regulated by FINTRAC as a money services business (this is why KOHO asks for ID when you sign up).
- Provincial consumer protection laws — covering disclosure, fees, complaint handling.
- Mastercard — payment-card network rules for the prepaid Mastercard, including Mastercard Zero Liability Protection.
- Partner institution’s regulators — indirectly, since Peoples Trust, which KOHO describes as a federally regulated bank, safeguards customer funds.
KOHO is NOT directly OSFI-regulated like a chartered bank would be. This is the most-cited gap by safety-conscious commenters. KOHO’s security page also lists a SOC 2 Type 2 report and annual PCI DSS assessments, and encryption of TLS 1.2 or higher in transit and AES-256 for stored personal data.
What can actually go wrong
Realistic risks to plan around:
- Account takeover — phishing, password reuse, SIM swap. Mitigation: two-step verification on the KOHO app, unique password. KOHO logins use Face ID, device biometrics, password or passcode, plus optional two-step verification.
- App outage — KOHO has had brief service outages typical of fintechs. No funded losses reported.
- Service changes — KOHO has shifted features and plan pricing several times. Changes can affect fees and benefits.
- Subscription drift — easy to upgrade to a paid plan and forget about it. Reviewing subscriptions periodically catches this.
- Balances outside CDIC — money not opted in to Earn Interest has no CDIC eligibility, and Earn Interest balances above the per-member limit are uninsured.
Risks that are not realistic to plan around:
- KOHO disappearing overnight. KOHO says 2.5M+ Canadians use it, and customer funds are safeguarded by its partner rather than taken as deposits by KOHO. In a wind-down, getting money back would run through that arrangement rather than through CDIC.
- The CRA confiscating KOHO funds. Funds in personal accounts are not subject to CRA seizure unless tax debt collection is involved (separate from KOHO’s status).
Comparison to other Canadian fintechs
| Feature | KOHO | Wealthsimple Chequing | Neo Financial |
|---|---|---|---|
| CDIC coverage | Eligible up to $100,000 per beneficiary, per CDIC member institution, once you opt in to Earn Interest | up to $1 million, because funds are spread across up to 10 CDIC member institutions (Wealthsimple itself is not a CDIC member) | Neo Chequing: eligible for CDIC insurance up to $100,000 |
| Direct OSFI | No | No | No |
| Major incidents | None reported | Data security incident detected August 30, 2025 | None reported |
Sources: KOHO, Wealthsimple and Neo Financial pages as recorded in YieldMaple's rates file.
All three are fintechs that use partner institutions for fund custody. None are chartered banks themselves. Safety profiles are broadly similar; the differences are in the CDIC structure and conditions.
Bottom line
An $80,000 KOHO balance with Earn Interest switched on sits inside the CDIC limit; the same balance without Earn Interest has no CDIC eligibility. At $200,000 or more, splitting between KOHO and another CDIC-member institution keeps each balance within the limit. For much larger sums, KOHO is not built for the job. Wealthsimple Chequing balances can be CDIC-covered up to $1 million, because funds are spread across up to 10 CDIC member institutions (Wealthsimple itself is not a CDIC member); deposits spread across several banks are the other option.
For typical use (daily spending, budgeting, a modest Earn Interest balance), KOHO is safe. This page is general education, not financial advice.
Read next
- KOHO Review — full review
- KOHO vs Neo Financial — comparison with closest competitor
- Is Wealthsimple safe? — different structure, more coverage
- Is EQ Bank safe? — chartered bank alternative