Wealthsimple Cash does two primary things. But, does it do them well? We'll have a look in this article.
First off, it’s a Canadian Venmo — letting people send money back and forth between each other for free. Like an e-Transfer, but less clunky.
It’s also a no-fee spending account. You get a prepaid Visa card that debits your Cash account and is accepted everywhere Visa is.
Wealthsimple says it doesn’t make any money on Cash. There are no fees to send money, make withdrawals, or use the card for transactions. It just wants to lure people into the Wealthsimple ecosystem, which includes products that charge fees.
“We expect that folks who use Wealthsimple Cash may also use our other products. You have no obligation to use those platforms, though we definitely encourage it,” the company says in an FAQ.
Wait, What is Wealthsimple?
Wealthsimple is a successful Canadian investment company. You’ve probably seen ads for its robo-advisor, Wealthsimple Invest, which lets investors take a hands-off approach to the stock market, for a much smaller fee than a traditional financial advisor. It also offers a discount brokerage, Wealthsimple Trade.
A Note: Wealthsimple Cash vs Wealthsimple Save
Wealthsimple’s savings account, called Wealthsimple Save, used to be called Wealthsimple Cash. So some older reviews of the savings account will refer to it as Cash.
Don’t get confused: Save is a free high-interest savings account that offers a decent 0.5% interest rate. It’s part of the main Wealthsimple Invest app, while Cash is an app of its own. Funds held in a Wealthsimple Cash account don’t earn interest.
How Does Wealthsimple Cash Work?
I was already a Wealthsimple Trade customer, so it took me less than 60 seconds to get set up. But it’s dead simple even if you’re new to Wealthsimple.
The app (available for iOS and Android) walks you through some basic required information, like your address and career, and a bank account to get funds from, and send funds to.
Then it asks you to pick a “$ign” — a username that people can use to find you on the app.
The idea is that it’s easier for someone who owes you money to remember your $ign, rather than your whole email. And it’s more private, if you don’t feel like giving a Kijiji random your personal email.
Note that you can’t change your $ign later. So choose well.
Then you can allow Cash to access your contacts to find people already on the app, but that's optional.
From there, sending or requesting money is a matter of a few taps. Searching for someone’s $ign is easy. The whole app is intuitive, and quite nice to look at.
There are no minimum balances.
Bottom line: Wealthsimple Cash is, well, simple. The company’s target audience is financial newbies, so it puts a lot of effort into making its apps pretty and straightforward.
Wealthsimple Cash vs. Normal Credit Cards
Wealthsimple’s prepaid Visa “Cash Card” essentially works like a debit card. It carries no interest rates, there are no annual fees, and it won’t impact your credit score.
Cash Card users earn 1% cash back on all purchase. You can easily find other free, non-prepaid credit cards that will beat that rate. But it beats out arguably its main prepaid Visa competitor in Koho, which only offers 0.5% cash back.
That 1% cash back can go straight into your Cash balance, or you can auto-invest it in stocks or crypto using Wealthsimple Trade.
You can use the card to take out cash at ATMs for a fee (usually $3).
Wealthsimple Cash Virtual Card
The Cash app also gives you a virtual prepaid Visa card that you can use for online purchases just like your physical one. It works with Apple Pay, Google Pay, and Samsung Pay.
Virtual cards are handy because they’re harder to lose, and more secure. They can’t fall prey to skimmers, and if someone gets a hold of your virtual card number, you can easily cancel and change it, without waiting for a new one in the mail.
Wealthsimple Cash vs. E-Transfer
Until now, Interac e-Transfers have been the go-to method for Canadians needing to settle bills or send cash to each other.
Using e-Transfers requires logging into your bank account and filling out an online form that varies in usability from bank to bank.
Some banks limit the number of free e-Transfers you can use per month, while Wealthsimple Cash has an unlimited number of free transfers, up to $5,000 daily and $20,000 monthly.
Cash transfers are also instant, whereas e-Transfers can take minutes or hours, depending on how the banks are feeling that day. I once bought a camera from a guy on Kijiji and sat there for — no joke — 45 minutes while the e-Transfer went through. The small talk ran out quickly.
E-Transfers also don’t allow for easy bill splitting. If you want to divide a cheque three or more ways, you have to do the math yourself and then send out individual e-Transfers to everyone.
You could use an app like Splitwise to keep track of who owes what to whom — but you can’t actually send money within it.
Wealthsimple Cash solves that problem in a typically elegant way. Just enter two or more people’s $igns, type in the total bill amount, and it’ll send a request to each person for their share.
The app doesn’t allow for non-even bill splitting, though. If Jake had seven mimosas at brunch, you can either decide as a group to eat that cost, or do the math yourself to hold Jake financially accountable for his decisions.
Wealthsimple Cash Drawbacks
It’s a free app, so there are some limits.
You can only deposit up to $250 instantly every 3 business days. Between $251 and $49,999, deposits take 1 business day to “settle” into your account. Deposit of $50,000 or more take 5 business days.
There's no way to set up bill payments or direct deposit, but Wealthsimple promises both are coming.
And the whole Wealthsimple suite uses 3 apps. If you have an Invest account for robo-advising, a Trade account to buy crypto, and a Cash account to send money, it can take up a lot of phone real estate.
One extra annoyance is that Wealthsimple Cash bugs you to invite friends for a $10 bonus. If you don’t, the notification stays on the homescreen at the bottom, with the prompt to “complete your profile," like you've forgotten to enter your email or something.
Is Wealthsimple Cash Safe?
Like the rest of Wealthsimple, Cash is protected by the Canada Deposit Insurance Corporation (CDIC). That means if Wealthsimple becomes insolvent, your money is insured up to $100,000.
But given Wealthsimple’s success (and the ownership of Power Corporation), it’s unlikely the company is going anywhere soon.
Wealthsimple also promises to never sell clients’ information.
If you sign up using this link, you’ll get a cash bonus added to your account!.
If you’ve already signed up, you can use the promo code UV0HQW. Just swipe left in the Wealthsimple Cash app, click the settings gear, then “Promos & referrals,” and enter it there.
Canada desperately needed a good Venmo/Cash App/Zelle alternative, and Wealthsimple Cash delivers.
With a sleek interface, easy transfers and handy features like bill splitting, it’s everything Canadians could want in a peer-to-peer cash transfer service.
It’s a strange decision from Wealthsimple to split up their offerings into three separate apps — and I wish I could get the “complete your account” notification to go away — but these are minor gripes compared to the convenience Cash offers.
The Wealthsimple Cash card is also a simple way to make purchases wherever Visa is accepted.
Though you can find free credit cards with more than 1% cash back, the fact that it applies to all purchases and can be auto-invested are nice perks.