Summary: A Guaranteed Investment Certificate (GIC) is required for Indian students applying to study in Canada. Continue reading to learn about the GIC process, its benefits, types, and how to transfer funds from India.
Canada is a popular destination for Indian students pursuing higher education, because of its world-class institutions, great environment, and post-study work opportunities. However, studying abroad requires meticulous financial planning, and one essential requirement for students going to Canada is a Guaranteed Investment Certificate (GIC) account.
A GIC account is not just a banking requirement; it’s a way to financial stability during your studies in Canada. If you’re planning to study in Canada, understanding all aspects related to the GIC account is crucial. This blog will take you through everything you need to know about GIC accounts in Canada.
What is a GIC Account?
A Guaranteed Investment Certificate (GIC) is a Canadian investment that offers a fixed rate of return over a specified period. It’s essentially a deposit that guarantees the return of your principal amount along with interest. For international students, particularly from India, opening a GIC account is a mandatory step when applying for a Canadian study permit under the Student Direct Stream (SDS) program.
The purpose of a GIC is to demonstrate that you have sufficient funds to cover your living expenses for the first year in Canada. Typically, students are required to deposit a minimum of CAD 20,635 into a GIC account, which is then disbursed in installments over the year to help manage living costs.
Why is a GIC Account Required?
The Canadian government mandates GIC accounts for students applying through the SDS program to ensure they have access to a steady flow of funds during their first year of study. This requirement serves multiple purposes:
1. It ensures that students have enough money to cover their living expenses in Canada without relying solely on part-time jobs or other uncertain sources of income.
2. Having a GIC account can expedite the visa application process under the SDS program, which is designed to be a faster and more streamlined pathway for study permit approval.
3. The installment-based disbursement of the GIC amount provides students with a regular source of income, helping them manage their finances effectively while studying.
Types of GICs for Indian Students
Canadian Guaranteed Investment Certificates (GICs) come in three main types, allowing students to choose one based on their needs for study visa approval:
1. Non-Cashable GIC: Ideal for students who can commit their funds for a set period. This type offers the highest rate of return, but the funds remain inaccessible until maturity.
2. Cashable GIC: Suitable for short-term investment without a lock-in period. You can withdraw your money anytime, though there may be a monthly withdrawal limit.
3. Equity Linked GIC (or Market Growth GIC): Provides returns based on market performance. Students benefit from a minimum guaranteed return and potential additional returns depending on market growth.
Eligibility Criteria for Canadian Guaranteed Investment Certificate
To qualify for a Canadian Guaranteed Investment Certificate (GIC), students must meet the following criteria:
1. Be a permanent resident of one of the following countries: India, China, Morocco, Pakistan, the Philippines, Brazil, Colombia, Senegal, Vietnam, Peru, Costa Rica, Antigua and Barbuda, Saint Vincent and the Grenadines, or Trinidad and Tobago.
2. Have an acceptance letter from a designated learning institution in Canada.
3. Demonstrate proficiency in English, with an IELTS score of 6.0 or higher.
Required Documents for Indian Students for GIC Account
Indian students are required to submit the following documents:Â
1. A copy of the student’s passport
2. PAN card
3. University offer letter or acceptance letter
4. Proof of enrollment or admission
How to Open a GIC Account in Canada?
Opening a GIC account is a straightforward process, but it requires some attention to detail. Here’s a step-by-step guide to help you open a GIC account in Canada:
1. Choose a Canadian Bank: Several Canadian banks offer GIC accounts to international students, including Scotiabank, ICICI Bank Canada, SBI Canada, and others. Research and compare the options based on interest rates, fees, and additional services. Below we have compared some of the popular options:
2. Register Online: Once you’ve chosen a bank, visit their website and register for a GIC account online. You’ll need to provide your passport, letter of acceptance from a Canadian institution, and other personal information.
3. Transfer Funds: After registration, you’ll receive details on how to transfer the required amount (usually CAD 20,635 plus a processing fee) to your GIC account. The transfer can be made via money transfer platforms or banks.
4. Receive Confirmation: Once the foreign bank receives the funds, they will issue a GIC certificate, which you can use as proof of financial support when applying for your Canadian study permit.
5. Account Activation: Upon arrival in Canada, visit the bank branch to activate your GIC account. You’ll need to present your passport, study permit, and other identification documents.
How to Transfer Funds to a GIC Account from India?
Transferring funds to your GIC account in Canada from India is a critical step in securing your Canadian study permit. It’s important to ensure that the transfer is done correctly to avoid any delays or complications in your visa process. Here’s a detailed guide on how to transfer funds to your GIC account:
Step 1: Choose a Transfer Method
There are two main ways to transfer funds to your GIC account from India:
1. Traditional Banks: Students may use their Indian bank account to transfer funds directly to their GIC account in Canada. Indian banks like State Bank of India (SBI), ICICI Bank, HDFC Bank, and others offer international wire transfer services that can be used for this purpose.Â
However, banks typically charge a high fee for international wire transfers, which can range from INR 500 to INR 2,500, depending on the bank. Additionally, banks often use inflated fixed exchange rates for the day, which can further increase the cost of the transfer.
2. Online Money Transfer Platforms: Another convenient option is to use online money transfer platforms like BookMyForex, which offer competitive exchange rates and zero bank charges. The platform allows you to book transfers online 24/7.Â
To make the process even easier, BookMyForex offers a doorstep KYC service, ensuring that you can complete the necessary verification without leaving your home. BookMyForex also allows you to lock in your desired exchange rate, ensuring you get the best possible rate.
Step 2: Confirm the Transfer Details
Before finalizing the transfer, double-check all the details to ensure accuracy. Ensure that the Canadian bank’s SWIFT code and GIC account number you’ve entered are accurate. Also, make sure the amount being transferred is at least CAD 20,635 plus any applicable fees, as this is the required minimum for your GIC account.
Step 3: Monitor the Transfer
After initiating the transfer, it’s important to keep track of the transaction. Most banks and online platforms will send you a confirmation email once the funds have been transferred. Transfers can take anywhere from 12 to 48 business hours, depending on the bank or platform you use.Â
Once the funds have been successfully transferred and received by your Canadian bank, they will issue a GIC certificate. This certificate is crucial for your Canadian study permit application.
FAQs
What is the purpose of a GIC account for international students?
A GIC account demonstrates that you have sufficient funds to cover your living expenses for the first year in Canada. It is a mandatory requirement for students applying for a Canadian study permit through the Student Direct Stream (SDS) program.
How much money do I need to deposit into a GIC account?
Typically, you need to deposit a minimum of CAD 20,635 into the GIC account. This amount is disbursed in installments over the year to help manage your living costs in Canada.
Can I access the funds in my GIC account before the end of the term?
It depends on the type of GIC you choose. Non-cashable GICs lock your funds until maturity, while cashable GICs allow you to withdraw your money anytime, though there may be limits on withdrawals. Equity-linked GICs provide returns based on market performance and may have different access conditions.
How do I transfer funds from India to my GIC account in Canada?
You can transfer funds through traditional banks or online money transfer platforms. Banks offer international wire transfers, which can be costly, while online platforms like BookMyForex provide the best exchange rates and zero charges, with added conveniences like doorstep KYC services.
What documents are required to open a GIC account?
You need to provide a copy of your passport, PAN card, university offer letter or acceptance letter, and proof of enrollment or admission to a designated learning institution in Canada.
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