The Best Credit Cards in Canada for 2024: 23 Categories Compared

We have carefully analyzed the numerous credit cards on the market and provided you with the best credit card options for travel, cash back, no annual fees, newcomers, balance transfers, bad credit, low interest rates, and more.

The winner of the overall best credit card is the Scotiabank Gold American Express Card.

However, it is not alone. Credit cards from Neo Financial, Tangerine, Simplii Financial, BMO, and American Express won best-in-class for different categories.

To arrive at this list of the best credit cards, we considered multiple features, including rewards, fees, insurance, perks, interest rates, and more.

Here are the Best Credit Cards in Canada

Category	Credit Card	Features	Annual Fee
Overall Best Credit Card in Canada	Scotiabank Gold American Express	40,000 bonus points ($400 value), 5 pts/$1 grocery, dining & ent., 3pts/$1 gas, Insurance x 12 types, $0 FX fees, discounted Priority Pass	$120
Best Cash Back Credit Card	Neo Credit	Average 5% cash back at 10,000+ locations, 15% welcome cash back on first purchases	$0
Best No-Annual Fee Credit Card	Tangerine World Mastercard	2% cashback on 3 categories, 1.95% balance transfer; 10% promo cash back offer ($100 value)	$0
Best Credit Card for Newcomers	Simplii Financial Cash Back Visa Card	0.5%-4% cash back, Low income eligibility, easy access to free chequing account with unlimited transactions	$0
Best Prepaid Credit Card	Neo Money Prepaid Card	Up to 5% cash back, free budgeting app, $20 welcome bonus, access to optional credit building	$0
Best Grocery Credit Card	Scotiabank Gold American Express	Up to 6pts/$1 on groceries, Insurance x 12 types, $0 FX fees, discounted Priority Pass	$120
Best Secured Credit Card	Neo Secured Credit	Guaranteed approval, Average 5% cash back, low security deposit, $25 welcome bonus	$0
Best Low-Interest Rate Credit Card	Scotiabank Value Visa Card	12.99% APR on purchases, cash advances, and balance transfers; 0% balance transfer for 10 months	$29; waived in 1st year
Best Premium Credit Card	The Platinum Card	Comprehensive insurance coverage, $200 annual travel credit, $200 annual dining credit, airport lounge access, earn 2pts/$1	$799
Best No-FX Fee Credit Card	Scotiabank Passport Visa Infinite	35,000 bonus points ($350 value), 2pts/$1 grocery, dining, transport & entertainment, $0 FX markup, airport lounge access	$150
Best Student Credit Card	BMO CashBack Mastercard – Students	Up to 3% cash back (monthly limits apply)	$0
Best No-Fee Travel Credit Card	American Express Green Card	Earn 1 pt/$1, easily redeem points or transfer to frequent flyer programs	$0
Best Travel Credit Card	Scotiabank Gold American Express	No FX fees, 3 pts/$1 spent on daily transit and gas, comprehensive insurance benefits (12 types), discounted Priority Pass	$120
Best Balance Transfer Credit Card	MBNA True Line Mastercard	12.99% APR on purchases and balance transfers, 0% balance transfer for 12 months	$0
Best Prepaid Card for Credit Building	KOHO Credit Building	Boost your credit score with a monthly subscription, earn cash back on purchases	$5-$10 monthly
Best Credit Card for Travel Insurance	Scotiabank Gold American Express	One of the most comprehensive trave insurance coverage in Canada	$120
Best Credit Card for Roadside Assistance	Triangle World Elite Mastercard	Free roadside assistance (Gold Plan), 4% cash back at Canadian Tire, 3% groceries	$0
Best Aeroplan Credit Card	American Express Cobalt Card	Easily transfer points to Aeroplan 1:1, 5pts/$1 grocery & dining, 3pts streaming; 2pts/$1 gas & transport	$155.88
Best Business Credit Card	Loop Corporate Credit Card	Multi-currency credit card, earn cash back points, Up to $1 million credit limit	$0
Best Credit Card for Gas	Scotiabank Gold American Express	3 pts/$1 spent on daily transit and gas, rental car insurance & 11 other types	$120
Best Credit Card for Lounge Access	Scotiabank Platinum American Express Card	10 complimentary airport lounge access yearly at Priority Pass and Plaza Premium lounges	$399
Best Credit Union Credit Card	Desjardins Cash Back World Elite Mastercard	One of the most comprehensive travel insurance coverage in Canada	$100
Best USD Credit Card	BMO U.S. Dollar Mastercard	Avoid FX fees on US purchases	$35

1. Scotiabank Gold American Express Card: Best Credit Card in Canada

The Scotiabank Gold American Express Card has many things going for it. It is a top rewards credit card that pays you up to 6 Scene+ points per $1 spent. These cash back points are also easy to redeem for travel, dining, grocery, or to pay off your statement balance.

The 5-6 points you earn per dollar spent on food and drink is one of the highest cash back rates for these categories in Canada. That said, the Scotiabank Gold Amex goes even further.

It is one of a few cards to waive the 2.50% foreign transaction fee you pay each time you spend in a foreign currency abroad. And while on the subject of travel, this card offers an impressive array of insurance benefits with 12 types of coverage.

Add on the discounted Priority Pass membership and 40,000 welcome bonus ($400 value), and you have a winner.

Lastly, this card has a low minimum income eligibility threshold of only $12,000, and its annual fee is $120. For comparative premium credit cards, you’d need a $60,000 to $80,000 minimum income to qualify.

This Scotiabank card wins three other awards that are discussed below.

Summary:

• 5 points (5% reward rate) on every $1 spent on groceries, dining, and entertainment
• 3 points for every $1 you spend on gas, daily transit, and streaming services
• No foreign transaction fees (a savings of 2.5%)
• 1 point on every $1 spent on everything else
• 20,000 bonus points ($200 travel value) when you spend up to $1,000 in the first 3 months, and an additional 20,000 bonus points when you spend $7,500 or more in the first year
• Comprehensive travel insurance, including travel emergency medical up to $1 million for up to 25 consecutive days (under 65 years) and up to 3 consecutive days (over 65 years), trip cancellation/interruption, delayed and lost baggage, travel accident (up to $1 million per incident), and hotel/motel burglary insurance
• Rental car collision loss and damage waiver (up to 48 consecutive days and $65,000 MSRP)
• Purchase security and extended warranty
• 35% discount on Priority Pass membership
• Easy to redeem travel rewards at 100 points = $1

For a card with an average annual fee, the Scotiabank Gold American Express does offer well-above-average benefits. You can read the full details.

2. Neo Credit: Best Cash Back Credit Card

There are cash back credit cards, and there is Neo Credit, the top no-annual-fee cash back credit card in Canada by far.

Neo Credit offers new cardholders up to a whopping 15% cashback rate at participating retailers.

For everyday purchases at thousands of locations, you earn an average of 5% cash back, which is easily one of the best rates offered by any of the 180+ credit cards we analyzed.

Using the Neo app, you can easily browse real-time offers in your area, from food and drink to grocery, transportation, travel, hotels, online shopping, and more.

And these perks all come with the no-annual-fee plan. For even more rewards, you can sign up for a Premium account at $4.99 monthly.

Learn about Neo Credit.

3. Tangerine World Mastercard: Best No-Annual Fee Credit Card

When you weigh the premium perks and no-annual fee status of the Tangerine World Mastercard, it is undoubtedly the best credit card in its category.

Cardholders earn an unlimited 2% cash back in two spending categories and get a third category if they deposit their cash back in a free Tangerine Savings Account.

Unlike most no-fee cards, this Tangerine credit card includes rental car collision and mobile device insurance. It also includes a complimentary Mastercard® Travel Pass Provided by DragonPass membership, with access to 1,300 airport lounges at $32 USD per visit.

Not to be left out is its introductory 1.95% balance transfer rate for 6 months and a 10% promotional cash back in the first two months valued at $100.

To qualify, you only need a 600 credit score and a personal annual income of $60,000 (or $100,000 for a household).

Learn about no-fee credit cards.

4. Simplii Financial Cash Back Visa Card: Best Credit Card for Newcomers

Newcomers to Canada can access a full suite of banking services through Simplii Financial.

From its no-fee chequing account that includes unlimited transactions and a $400 cash offer, to a cash back credit card, and international money transfers, Simplii has all the basics covered.

The Simplii Financial Cash Back Visa Card has no annual fees. It pays up to 4% cash back at restaurants, 1.5% cash back on gas, groceries, drugstore purchases, and pre-authorized payments, and 0.5% on everything else.

While there are spending caps for the 4% and 1.5% earning rates, this card stands out in the newcomer category.

Apply through the New to Canada Banking Program, and you could get up to a $10,000 credit limit with no Canadian credit history required.

The ease of application, no-transfer fee international money transfers, access to unlimited chequing transactions, and no monthly/annual fees make Simplii Financial a top banking choice for newcomers.

5. Neo Money Card: Best Prepaid Credit Card

Want to avoid paying interest while earning cashback? The free Neo Money card offers the best of both worlds: convenient payments worldwide and cash back rates of up to 5%.

The free version works well and comes with a spending account with unlimited transactions and e-Transfers.

Another highlight of the Neo Money card is that it has no credit or income requirements.

Power users can upgrade their account to Premium for a monthly fee and enjoy higher cashback rates, plus access to insurance benefits, credit score monitoring, and priority support.

In a world of prepaid cards that are limited in function and more like gift cards, the reloadable Neo Money Mastercard is ahead of the competition.

Learn about prepaid credit cards.

6. Scotiabank Gold American Express Card: Best Grocery Credit Card

The overall best credit card in Canada also ranks as the best credit card for grocery purchases. If you shop at Sobeys, Safeway, FreshCo, or Foodland, you’ll get the best bang for your buck using the Scotiabank Gold American Express Card.

It offers 6 points for every $1 you spend at these stores and 5 points per $1 at other eligible grocery stores (over 1,100 stores). The 5x rate also extends to restaurants, food delivery, and food subscriptions.

7. Neo Secured Credit Card: Best Secured Credit Card

Neo Secured Credit is the top secured credit card in Canada.

It doubles as a cashback credit card, standing shoulder-to-shoulder with many of the best cash back credit cards that have no annual fee.

The features that set this card apart from the others in its category include:

• No annual fees: While secured credit cards can set back up to $120 annually, Neo Secured Credit has no annual fee.
• Cashback rewards: Cardholders earn up to 5% cashback at partner stores.
• Guaranteed approval: There is no hard credit check, and approval is guaranteed if you are the age of the majority, are a Canadian resident, and can provide security funds (starting at only $50).

Neo Financial reports to a credit bureau to help you build your credit history.

Learn about secured credit cards.

8. Scotiabank Value Visa: Best Low-Interest Credit Card

If you seek a low-interest credit card that saves you money when you carry a balance, consider the Scotiabank Value Visa Card. It has a low 12.99% regular interest rate for purchases and cash advances, and offers a 0% introductory rate on balance transfers for the first 10 months.

The Scotiabank Value Visa costs $29 annually, but this is currently waived in the first year.

This card isn’t designed for earning cash back. However, if what you need is a low-rate card that significantly lowers the interest you pay on your credit card balance, consider adding it to your wallet.

Learn about low interest credit cards.

9. The Platinum Card: Best Premium Credit Card

The American Express Platinum Card is the best premium credit card in Canada.

If you want to be spoiled on your travels while enjoying comprehensive insurance benefits and coverage, The Platinum Card is for you.

For a $799 annual fee, you get a $200 annual travel credit, a $200 annual dining credit at eligible restaurants, access to over 1,300 airport lounges worldwide, premium perks at Toronto Pearson International Airport, hotel perks, and more.

In addition to this, cardholders earn up to 2 points per $1 spent and can use these points for travel booking, gift cards, and statement credits.

You can also transfer your points to many other loyalty programs.

See the best Amex credit cards.

10. Scotiabank Passport Visa Infinite Card: Best No-FX Credit Card

When travelling abroad, you pay a 2.50% foreign transaction fee each time you make a foreign currency purchase using your Canadian credit card. Some credit card issuers even charge 3%.

You can waive these FX fees using the Scotiabank Passport Visa Infinite Card, which tops all other no-FX fee credit cards in Canada.

Apart from waiving FX fees, this card offers up to 3 Scene+ points on your purchase. It is also an excellent card for airport lounge access, with six complimentary lounge visits annually via the Visa Airport Companion Program.

Lastly, cardholders can take advantage of 11 insurance types.

To qualify for the Scotiabank Passport Visa Infinite, you need a minimum personal income of $60,000 or $100,000 for a household.

New applicants get up to 40,000 bonus points ($400 value). This card has a $150 annual fee.

11. Students – BMO CashBack Mastercard: Best Student Credit Card

The Students BMO CashBack Mastercard is the best no-fee cashback credit card for students in Canada. It takes the top spot with its ease of qualification and significant cash back earn rates for everyday purchases.

Cardholders earn 3% cashback on grocery spending up to a limit of $500 spent monthly.

For recurring bill payments, you earn 1% cashback (up to $500 limit for each statement period), and you earn 0.50% cashback on all other purchases.

Cashback earned can be deposited into your BMO chequing, savings, or InvestorLine account, or you can get a statement credit.

To qualify for this card, you must be between 18 and 24 and be a student at a recognized post-secondary school.

Learn about student credit cards.

12. American Express Green Card: Best No-Fee Travel Credit Card

The American Express Green Card is our top choice for Canada’s best no-annual-fee travel credit card.

With no annual fees, cardholders earn 1 Membership Rewards (MR) point for every $1 spent. The points earned double while you use the card to book hotel or car rentals on the Amex Travel Online platform.

MR points can be redeemed for gift cards, merchandise, travel bookings, or to pay for Amazon purchases.

Even better, you can transfer your points on a 1:1 basis to frequent flyer programs like Aeroplan, Asia Miles, Delta SkyMiles, and Etihad Guest.

13. Scotiabank Gold American Express Card: Best Travel Credit Card

In choosing the best travel credit card, we looked at the card that scored highest across the main features you want in a travel card: flexibility, reward rate, insurance coverage, ease of redemption, welcome bonus, and no-FX fees.

Our overall best Canadian credit card, the Scotiabank Gold American Express Card, tops the list of cards you should consider for travelling.

You save 2.5% on foreign currency transaction fees, earn 3 points per $1 spent on daily transit and gas, and access to comprehensive travel insurance.

You can also redeem your points to book travel through Scene+ Travel.

14. MBNA True Line Mastercard: Best Balance Transfer Credit Card

With its offer of a 0% introductory rate on balance transfers for 12 months, the MBNA True Line Mastercard is the best balance transfer credit card in Canada.

This exceptional offer is available for balance transfers you complete within 90 days of opening your account.

Considering you could be paying 20% interest on your balance, the MBNA True Line Mastercard can provide significant savings. It also has no annual fees.

After the promotional period ends, you pay a standard 12.99% interest rate on purchases and balance transfers. To qualify for this card, you must be a Canadian resident and the age of the majority in your province of residence.

Learn about balance transfer cards.

15. KOHO Credit Builder: Best Prepaid Card for Credit Building

Looking to build, rebuild, or establish credit? Your choices typically include applying for a traditional credit card or a secured credit card. However, it can be challenging to qualify for a regular credit card if you have poor credit.

This is where the KOHO Prepaid Mastercard comes into play.

KOHO does not require a credit check, and you qualify with any income. After you get a KOHO Card (free or paid), you can add on Credit Building for $5 to $10 monthly (the cost varies with the KOHO plan you have).

Your monthly payments are reported to Equifax, helping you build credit. KOHO users see an average credit score increase of 22 points after 3 months of using the Credit Building product.

Learn about credit building in Canada.

16. Scotiabank Gold American Express Card: Best Credit Card for Travel Insurance

While the top premium cards generally provide travel insurance, none combines them on a cost-per-value basis like the Scotiabank Gold American Express Card, our #1 best credit card for 2024.

It offers travel emergency medical insurance, trip cancellation/trip interruption, flight delay, delayed and lost baggage, travel accident, rental car collision, hotel/motel burglary, mobile device insurance coverage and more.

The only letdown is that travel emergency medical insurance coverage for those 65 and older is for up to 3 consecutive days.

Given this card’s comparatively low $120 annual fee, it is a bargain when you consider its entire package.

Learn about credit card insurance.

17. Triangle World Elite Mastercard: Best Credit Card for Roadside Assistance

The Triangle World Elite Mastercard is your best choice for free roadside assistance.

If you regularly shop at Canadian Tire, this card is an absolute must-have with 4% cash back (Canadian Tire Money) on your purchases at Canadian Tire, Sport Chek, Mark’s and Atmosphere stores, 3% on groceries, and 1% on everything else.

It also offers a free Gold Plan roadside assistance with towing distance of up to 250km with each service call in Canada and the US, car rental collision insurance, and 5-7 cents per litre on gas purchased at Gas+ locations.

Considering it has no annual fees, this Triangle credit card is a well-hidden secret. To qualify, you need a minimum income of $80,000, or $150,000 for household income.

18. American Express Cobalt Card: Best Aeroplan Credit Card

The American Express Cobalt Card is one of the top credit cards that come to mind when considering travel rewards. While cardholders don’t earn Aeroplan points directly, using this Amex card, they can transfer their Membership Rewards points on a 1:1 basis to Aeroplan.

With the Amex Cobalt offering up to 5 points per $1 spent on food and drinks, 3 points/$1 on streaming subscriptions, 2 points/$1 on travel, and 1 point/$1 everywhere else, it is easy to accumulate points.

This card also includes comprehensive travel insurance and other perks for a $12.99 monthly fee or $155.88 annually.

The TD Aeroplan Visa Infinite Privilege Card ($599 annual fee) is a runner-up for the best Aeroplan credit card in Canada.

19. Loop Corporate Card: Best Business Credit Card

The Loop Corporate Credit Card is just one of many innovative products available in the Loop ecosystem of financial products.

Issued by WFCU Credit Union Ltd., small businesses can get multiple corporate credit cards in various currencies, including CAD, USD, GBP, and EUR. This can save you thousands in FX fees annually since you can now make payments in the local currency.

There is no monthly or annual fee. You can get up to a $1 million credit limit based on your revenues and have 55 days to make payments.

In addition, Loop offers opportunities to earn cash back points on your purchases, with easy redemption at brands like Amazon, Uber, and Air Canada.

A Loop Corporate Card also makes running your business a lot easier, with the ability to:

• Create multiple virtual cards in different currencies for your team members
• Set spending limits
• Digitally capture receipts for verification
• Integrate your transactions with accounting software like Quickbooks and Xero for easy reconciliations

Pair this card with their free global banking account (USD, CAD, GBP, and EUR) and international transfer service, and you have the best business credit card in Canada.

Learn about business credit cards.

20. Scotiabank Gold American Express Card: Best Credit Card for Gas

For the fifth time on this list, the Scotiabank Gold American Express claims the top spot, this time as the best credit card for gas purchases.

It offers 3 points for every $1 spent on gas and daily transit, including rideshare, buses, subway, and taxis.

Add on the fact you earn up to 6 points per $1 spent on groceries, get comprehensive travel insurance and can redeem your points in so many ways.

21. Scotiabank Platinum American Express Card: Best Credit Card for Lounge Access

The Scotiabank Platinum American Express Card is Canada’s top airport lounge access credit card.

It offers 10 complimentary airport lounge access annually at Priority Pass and Plaza Premium lounges with over 1200 VIP lounges worldwide. Supplementary cardholders get 4 free visits each year.

Airport lounge access is just one of many perks offered by this card. It also provides comprehensive insurance coverage (10 types), no FX fees, luxury travel privileges, and more.

The Scotiabank Platinum Express Card has a $399 annual fee, and supplementary cards cost $99.

22. Desjardins Cash Back World Elite Mastercard: Best Credit Union Credit Card

The Cash Back World Elite Mastercard from Desjardins is our pick of the best credit union credit cards.

With a $100 annual fee, cardholders earn 4% cashback on groceries, a 3% rate on restaurants, entertainment, and alternative transportation purchases, and 1% on everything else.

This card also includes travel insurance benefits, car rental, and mobile device insurance coverage.

To qualify, you need a minimum personal annual income of $80,000 or $150,000 for household income.

23. BMO U.S. Dollar Mastercard: Best USD Credit Card

Looking for a U.S. dollar credit card to use for those cross-border purchases? The BMO U.S. Dollar Mastercard wins the top spot in Canada.

Its annual fee of $35 USD is on the lower end for comparative cards, and this fee is waived when your total USD purchases are $1,000 or more in a year. A supplementary card is free.

Cardholders can use this Mastercard at over 30 million locations worldwide. They enjoy purchase protection and extended warranty and get discounts on the admission fees for Cirque du Soleil shows.

Learn about US Dollar credit cards.

How Credit Cards Work in Canada

Credit cards are a type of short-term loan. They are typically unsecured loans, but some credit cards are secured.

When you purchase or withdraw cash from an ATM with your credit card, the issuer essentially lends you money. At the end of the month, you receive a statement for the amount you have borrowed, which you can then pay back by the payment date.

Credit cards are different from other loans because they have an interest-free period. If you pay for the charged purchases in full by the day your statement is due; you won’t have to pay any interest.

If you don’t pay it all back, however, you will start to pay interest on the unpaid balance. There is also a minimum payment requirement. This is the minimum amount that you have to pay back.

Credit card interest rate is expressed as the Annual Percentage Rate (APR). However, you are charged interest daily. Divide the APR by 365 to determine how much you are charged daily.

Credit card companies also charge annual fees and other fees like balance transfer fees, which we will look at in more detail later.

Types of Credit Cards in Canada

There are many different types of credit cards in Canada. Here are the main types you can choose from:

Rewards Credit Cards

Rewards credit cards are perhaps the most well-known and most popular. These credit cards give you rewards for using them. Rewards can take on various forms, like cashback and points.

Low-Interest Credit Cards

These credit cards have a lower APR. While a typical APR is around 20%, low-interest credit cards have an APR of about 12%. These can be useful for people who carry a balance and want to pay less interest each month.

Balance Transfer Credit Cards

Balance transfer credit cards allow you to transfer a balance from another credit card. In addition, they may offer a low interest rate or 0% interest for the first few months. This means you can pay off your debt sooner and for less.

Secured Credit Cards

Secured credit cards require a security deposit. They are typically targeted at people with poor credit scores or no credit history.

With these cards, you make a security deposit, and you can then borrow up to that amount on your credit card. They can be useful for people who want to build their credit scores.

Types of Credit Card Rewards in Canada

Many credit cards provide rewards for using them. As mentioned previously, they will typically provide you with more rewards the more you spend. Here are some of the most common rewards:

Cashback

Cashback is a popular reward where you receive a percentage of your spending on every purchase. The amount is usually quite low, between 0.5% and 3%, but welcome bonuses can give you up to 10% or more.

There is often an upper limit for the amount of cashback you can claim. In addition, some cards will pay out whenever you want, while others will only pay out monthly or when you reach a certain amount.

Reward Points

Many credit cards also have point programmes. With these, you can earn points for spending on your card and then use those points to get discounts and other bonuses.

Travel Rewards

Travel rewards are common. Some cards include travel insurance when you purchase the trip using the card. Others may give you discounts on trips, car rentals and hotels, while some cards allow you to earn miles when you spend.

Some cards have no foreign exchange fees and may provide free international withdrawals.

How to Maximize Credit Card Rewards in Canada

First, ensure you understand the process for getting rewards with your card. With cashback, for example, you can sometimes earn a higher rate for purchases in certain categories like groceries or gas.

The credit card usually lists participating stores and brands where you can earn more cashback or points. Find out where they are and do more of your shopping at these partners to earn higher rewards.

You can also benefit from welcome offers, so look out for these when you are choosing a new card. These may include extra cashback, bonus points or a longer low-interest rate to tempt you to apply.

Also, make sure you don’t lose your rewards. Some rewards programmes have expiration dates, so ensure you cash out your rewards before they expire.

How To Choose the Best Credit Cards

Choosing the best credit card comes down to what ‘best’ means in your case. However, there are a few factors to take into account:

Rewards Offered

As discussed already, there are many different types of rewards, so think about what you want from your credit card.

A certain reward programme may appeal to you, or you may prefer to use a card that provides cashback.

Don’t forget to consider any welcome offers. For example, if you’re planning to make a large purchase and a welcome offer provides a higher cashback rate in the first few months, it may be worth considering.

Interest Rate

If you already carry a balance or are likely to do so, a low-interest credit card or a balance transfer credit card may be a better option.

Compare these types of credit cards because you will find that some have better interest rates or longer periods with zero interest rates.

Credit Card Network

You should also consider the network, which will usually be Mastercard, Visa or American Express.

Mastercard and Visa are widely accepted, and it’s hard to pick a winner. If you shop at a certain store every week, you may want to check whether they accept all credit cards.

America Express is not as widely accepted, so you may not want to use this as your only credit card.

Requirements

Many cards will have minimum income requirements and a good credit score. If you don’t meet the requirements, this will limit your options.

Fees

Some cards have a high annual fee but lots of premium perks. Conversely, some cards have low or no fees but fewer or no rewards.

Always compare the total cost of the card, including fees, to calculate which card is best for you.

How To Apply for a Credit Card in Canada

Applying for a credit card in Canada is relatively straightforward:

• Decide which type of credit card you want.
• Compare similar cards to decide which is best for you.
• Study the application requirements (age, residency, minimum income, etc.)
• You may want to check your credit score first, which you can do for free using a service like Borrowell.
• Once you have chosen a card, apply for it (usually online) by filling out all the required information.
• The credit card issuer will then either approve or decline your application.

Fees to Watch for with Canadian Credit Cards

The main cost to keep in mind is the interest, which all credit cards will charge. But there are several other fees to consider:

• Annual fee – the fee you pay once a year for using the card.

• Balance transfer fee – you pay this when you transfer your balance from another card. It is usually expressed as a percentage (e.g. 2% of the total amount transferred.)

• Cash advance fee – most cards charge a fee for cash advances, and many charge a higher interest rate too.

• Late payment fee – if you make a payment late, you may be charged this fee.

• Foreign transaction fees – many cards charge extra fees when you spend in a foreign currency.

• Returned payment fee – a fee may be charged if the transaction cannot be processed.

• Overlimit fee – this fee is charged if you go over your credit limit.

• Inactive account fee – some credit cards have fees if you do not use your card for a certain period.

Pros of Credit Cards

• A good way to earn rewards and cashback for everyday spending. If you pay back your balance every month, you can get rewards that you would be missing out on otherwise.

• A convenient way to access money if you don’t have enough in your bank account.

• Most credit cards are unsecured, so you don’t have to put up any collateral. However, this is not the case for secured credit cards.

• Paying your monthly payments on time can help you improve your credit score.

• Some credit cards provide extra perks like extended warranties and travel insurance for extra peace of mind.

• Credit cards are a secure and convenient way to pay everyday expenses without carrying cash.

Cons of Credit Cards

• Credit cards typically charge high interest rates, which can be expensive if you carry a balance.

• It can be easy to spend too much using a credit card, which can be problematic if you do not carefully control your spending habits.

• Failing to make your payments on time can harm your credit score.

• You may have to pay a cash advance fee if you use an ATM, which you would not normally pay with a debit card.

Related: How Do Credit Cards Work in Canada?