If you’re thinking about studying in Canada, one of the most important things you should know about is the Student GIC program. This program plays a very important role, especially if you’re going to Canada for higher studies.
But what is Student GIC, and why is it so important for international students? In this blog, we’ll walk you through the details of what the Student GIC program is and why it is important for international students. Let’s get started!
What is GIC for Canada?
GIC stands for Guaranteed Investment Certificate (GIC). It is one of the financial requirements for international students who want to study in Canada under the Student Direct Stream (SDS) program. It makes your study permit application process much faster and more seamless.
The new Student Direct Stream is supposed to facilitate your process of acquiring a study permit for Canada. The permit is purchased under the RBC International Student GIC Program.
The purpose of GIC is to show to the government of Canada that you have enough money to support your studies and your stay in Canada. You deposit a set amount of money into a Canadian bank account, which acts as a secure investment account.
Over the year, the bank gradually releases portions of this money to you for living expenses, ensuring you have financial support during your stay.
Throughout the year, your money is protected by the Canada Deposit Insurance Corporation (CDC) and will also earn interest at a specified rate for a certain period.
GICs are also known as safe investments because the financial institutions that sell them are legally obligated to return investors’ principal and interest. So, even if the bank fails, investors are insured for up to $100,000 by the Canadian Deposit Insurance Corporation (CDIC).
The amount of money you need to invest depends on the province or territory you want to study in, but it’s usually around CAD 10,000–20,635. You can purchase a GIC from any authorized Canadian financial institution, such as SBI Canada Bank or Scotiabank.
That makes the GIC necessary for controlling your money and fulfilling your visa requirements in Canada.
Also Read: Study Abroad Guide for Indian Students 2024
Eligibility for GIC
Before applying for the GIC program, you must meet certain criteria. Here’s the list of requirements that you must fulfill to apply for a student GIC, they are:
- You should be a legal resident of one of the following countries: China, India, Morocco, Pakistan, or the Philippines.
- You must possess an acceptance letter from a postsecondary Designated Learning Institution (DLI). DLI is the Designated Learning Institution, a school recognized and approved by a provincial/territorial government to host international students. All primary and secondary schools in Canada are DLIs. If you are going to go to a postsecondary school, then you must ensure it is on this list.
- Be living outside of Canada when you apply.
- If you plan to study in Quebec, you must have a certificat d’acceptation du Québec (CAQ). You can get all the info on how to file for a CAQ from your school.
- As a student willing to study in Canada, you must have proof of CAD 20,635 to cover living expenses for the first year in Canada (not including tuition).
Required documents for Canadian Guaranteed Investment Certificate
If you want to open a GIC account, then you will need the following documents:
- A valid passport
- A government identification card
- Your proof of admission, like the Letter of Acceptance (LOA)
- Your proof of financial support, like a loan application or proof of income
- Medical Clearance Certificate
Benefits of GIC
There are many benefits of the GIC certificate that you should know. Let us see them below:
Simplified visa process
A GIC account is a mandatory requirement under the Student Direct Stream (SDS) visa category, which speeds up the processing time for your Canada study permit.
Financial stability
The GIC provides you with a guaranteed and safe income to pay for your living expenses for your first year in Canada so you can manage your money wisely.
Easy access to funds
When you get to Canada, you receive your GIC money in monthly or bi-monthly installments. This gives you a constant income for things such as rent, food, and bus fare.
Building credit history
If you have a GIC account with a bank in Canada, this will give you a credit history in Canada, and it will be much easier to get other loans, such as student loans or credit cards.
Safe investment
The GIC is a low-risk investment with a guaranteed return, meaning you won’t lose any money. They hold your money and give you a little bit of interest on it, and then give you back your money as they give you your payments.
Also Read: How Much Gap Is Accepted for Study in Canada?
Tips to choose the right Canadian GIC
A Canadian Guaranteed Investment Certificate can help cover expenses and provide financial support. Here are some tips for selecting the right GIC in Canada:
- Seek out banks that operate within Canada.
- Verify if the GIC is accessible from India.
- Understand the maximum investment limit.
- Look for GICs that provide competitive interest rates.
- Review the different types of GICs available from the bank.
Is GIC mandatory for studying in Canada, and why?
Not all students coming to study in Canada need to take the GIC. But then again, it is one of the components necessary for international students who are applying through SDS (Student Direct Stream), which is a stream for faster visa processing for students from countries like India, China, the Philippines, and Vietnam.
If you are applying under SDS, you have to show you have the money and buy a GIC of CAD 20,630.
Why is GIC Required?
- Proof of financial stability: The GIC guarantees that the student will have enough money to live off of during their first year in Canada. This helps the Canadian government know that you will not have any financial difficulties or pending dues while studying.
- Encourages responsible financial management: The GIC helps international students manage their finances responsibly by providing them with monthly and bi-monthly disbursements.
- Assures Canadian authorities: The GIC program makes Canadian authorities feel better about the fact that international students are ready and have a financial plan, thus increasing their overall stability and success.
Top banks to offer GIC Canada
You can’t buy a GIC from just any bank. It’s wise to choose from the list of Indian banks authorized to offer GICs for Canada. These include:
- ICICI Bank
- Canadian Imperial Bank of Commerce (CIBC)
- SBI Canada
- Scotiabank
- HSBC Bank of Canada
Also Read: Education Loan for Study in Canada: Interest Rates, Courses, Requirements & Banks
GIC Canada fees for international students
As of January 1, 2024, the GIC amount for international students in Canada is CAD 20,635.
Apart from the GIC amount, you will most likely face a processing fee of 150 to 200 CAD. For example, for Scotiabank, you’ll have a processing fee of CAD 200 and CAD 150 for banks like CIBC and ICICI Bank.
Your home bank might also charge you wire transfer fees. Those tend to be between CAD 20 and CAD 50, depending on the bank and the country. But if you wire it in a different currency than CAD, you will most likely get charged currency conversion fees, so having a Canadian dollar account is better.
Some banks may charge a small monthly maintenance fee, typically CAD 1 to CAD 5, for managing your GIC account.
Additionally, withdrawing your GIC funds before the maturity date can result in penalties, such as losing some of the earned interest, so avoiding early withdrawals is best.
Lastly, watch out for supplementary charges for extra services such as paper statements or special requests. Knowing these costs will help you make a decision and prepare your wallet for studying in Canada.
What is a non-redeemable GIC account?
Non-redeemable GICs are also known as non-cashable GICs. They are basically a form of Guaranteed Investment Certificate in which the money you put into it is tied up for a certain amount of time (12-60 months), usually anywhere from a couple of months to a couple of years.
And, of course, you can’t withdraw or use the money during this time, or you will be penalized severely. In most cases, you can’t withdraw early at all.
However, because of this commitment, nonredeemable GICs tend to offer higher interest rates than redeemable GICs, which makes them very appealing to someone looking for a secure investment with a guaranteed return over a certain amount of time.
This kind of GIC is perfect for those who don’t need to access their money immediately and just want a stable, dependable return.
Things to remember about the GIC certificate in Canada
So here are a few things to remember about that GIC certificate in Canada.
- Make sure to select a Canadian financial institution that provides a GIC and complies with the SDS requirements.
- You won’t be able to access the GIC account until you reach Canada.
- The financial institutions will only disburse the funds after verifying your identity.
Canadian banks will disperse the money in the following manner:
- Once your identity is confirmed upon your arrival in Canada, an initial lump sum will be provided.
- The rest of the amount will be paid monthly or every other month, with payments over 10 to 12 months.
How to open a GIC account?
If you want a GIC (Guaranteed Investment Certificate) in Canada, you must first complete an online application with a specific bank.
Secondly, you must send copies of your passport, university offer letter, and government-issued ID.
Once you apply, you will be assigned an account number and the procedures to transfer the money. Then, you wire transfer money into your account, and you will receive a receipt of your GIC certificate.
But you can open it once you’re in Canada, at a branch, or at that online bank.
Here are a few steps to open a GIC account with TD Canada Trust.
- Apply online for a TD Student Chequing Account and a TD International Student GIC.
- Finish the ID verification and get the account information and the wire transfer instructions.
- Your initial wire transfer must be at least CAD 20,635 and must be received in your TD Student Chequing Account within 90 days of opening the account.
- TD gets your cheque, places CAD 20,635 in your GIC, and returns your Confirmation of Investment.
- Come to Canada and go to a TD branch to activate your account, verify your ID, and sign the papers. Then TD will redeem your logic for CAD 4,635 plus the interest it accrued and put it in your TD student chequing account.
FAQs
It depends on your capacity. Having said that, you need to pay at least CAD 20,635 for a GIC in Canada up until April 2024.
You can apply for a GIC if you are an Indian student applying through the Student Direct Stream (SDS) to study in Canada. You will need a passport and acceptance from a DLI (Designated Learning Institution) in Canada, as well as the financial requirements met.
The GIC account shows that you have the money available to support yourself for your first year in Canada. This certificate helps the authorities provide you with a study permit faster based on the fact that you’ll be pre-paying the GIC amount and it will cover your stay in Canada for at least a year.
The documents required for the GIC certificate are your PAN card, a copy of your passport, an offer letter from your university or an acceptance letter, and proof of enrollment or admission in a designated learning institution in Canada.
In the case of Indian students, the most popular banks for student GICs are Scotiabank and ICICI Bank Canada. It has this “Scotia GIC Program”, which is easy to apply to, and has really good customer service.
ICICI Bank Canada is another good option among Indian students; they have a really easy application process, speak many languages, and have lower processing fee.
