Best Credit Cards for Newcomers to Canada

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by Enoch Omololu

Updated

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New immigrants to Canada have a lot to take in when they first arrive. From personal finances to housing and employment, the first year in Canada goes by really fast.

It does not take long before you realize you need to start building your credit history in Canada. Lenders want to see that you have a good credit score and one way to establish and build this is to get a credit card and use it responsibly.

Below, I list some of the best credit cards for newcomers to Canada that I have reviewed within the last year or so.

Best Credit Cards for New Immigrants

Many of the big banks and credit unions in Canada have some sort of newcomer program directed at new immigrants and international students.

Examples include the Scotiabank StartRight Program, RBC Newcomer Advantage, CIBC Welcome to Canada Banking Package, BMO NewStart Program, and TD’s New To Canada Banking Package.

Through these “Welcome to Canada” packages, you can waive the account bank fees on new accounts for up to 12 months.

The best credit cards for newcomers include both no-fee and annual-fee cards. Some of them require little to no income and others (e.g. Mastercard World Elite cards) require at least $80,000 in personal income per year.

Best No-Fee Credit Cards for Newcomers

  1. Tangerine Money Back Credit Card
  2. Scotia Momentum No-Fee Visa
  3. BMO CashBack Mastercard
  4. Scotiabank SCENE Visa
  5. PC Financial Mastercard

Best Premium Credit Cards for Newcomers

  1. Scotiabank Passport Visa Infinite Card
  2. American Express Cobalt Card
  3. Scotiabank Gold American Express Card
  4. BMO Air Miles World Elite Mastercard
  5. Scotia Momentum Visa Infinite Card

No-Fee Credit Cards for Newcomers and International Students

Tangerine Money-Back Credit Card

Looking for a card that pays 2% cash back on your most frequent purchases? The Tangerine Money-Back Credit Card comes with 2% cash back in up to three categories and 0.50% on everything else.

Eligible cash back categories for the 2% money-back include groceries, restaurants, gas, recurring bill payments, entertainment, drugstore, home improvement, public transport, and furniture.

For a limited time, new cardholders get an extra 10% cash back on up to $1,000 spending in the first 2 months (with a $100 value).

This card also offers extended warranty and purchase protection, and more importantly, there is no annual fee.

  • Annual fee: $0
  • Interest rate: 19.95%
  • Rewards: cash back
  • Minimum income eligibility: $12,000
  • Other perks: 1.95% balance transfer interest rate for 6 months (3% fee applies)
  • Learn more: Tangerine Money-Back Card review
tangerine money-back card
APPLY FOR THIS CARD

If you have a personal annual income of $60,000 or more, you can opt for the no-fee premium Tangerine credit card: Tangerine World Mastercard.

It offers all the same benefits of the Tangerine Money-Back card, plus free mobile device insurance, rental car insurance, and complimentary membership in Mastercard Airport Experiences provided by LoungeKey.

Scotia Momentum No-Fee Visa

This no-frills, no-annual-fee credit card offers a low 7.99% introductory interest rate for 6 months and up to 1% cash back on grocery, gas, drugstore purchases, and recurring bill payments. For all other eligible purchases, a 0.50% cash back rate applies.

You can save up to 25% off base rates when you rent a car at participating AVIS and Budget locations and pay with your Scotia Momentum No-Fee Visa Card.

  • Annual fee: $0
  • Interest rates: 19.99% purchases and 22.99% cash advances
  • Rewards: cash back
  • Minimum income eligibility: $12,000
  • Other perks: none
  • Learn More: Scotia Momentum No-Fee Visa review
Scotia Momentum No-Fee Visa Card
APPLY FOR THIS CARD

BMO Cash Back Mastercard

The BMO CashBack Mastercard is a great card option for students and new immigrants.

This card pays 3% cash back on grocery purchases, 1% cash back on recurring bill payments, and 0.5% cash back on all other purchases. There is a $500 maximum monthly spending limit for the 3% and 1% cash back rewards categories.

This card also offers a 1.99% promotional balance transfer interest rate for 9 months (a 1% transfer fee applies).

  • Annual fee: $0
  • Interest rate: 19.99% purchases and 22.99% cash advances
  • Rewards: cash back
  • Minimum income eligibility: $12,000
  • Other perks: save up to 25% on car rentals at National Car and Alamo Rent A Car
  • Learn more: BMO Cash Back Mastercard review
BMO Cashback Mastercard
APPLY FOR THIS CARD

Scotiabank SCENE Visa

This card allows you to earn SCENE rewards points you can redeem for free movies or food and drink at multiple restaurants including Harvey’s and Swiss Chalet.

You earn 1 SCENE point for every $1 spent on everyday purchases and 5 SCENE points per $1 spent at Cineplex.

New cardholders receive 2,500 bonus points (worth 2 movies) after spending $500 in the first 3 months.

Learn about how to get free movies using this card.

  • Annual fee: $0
  • Interest rate: 19.99% purchases and 22.99% cash advances
  • Rewards: SCENE points
  • minimum income eligibility: $12,000
  • Learn more: SCENE Visa Card review
SCENE Visa Card

PC Financial Mastercard

If you regularly shop at the Real Canadian Superstore, Shoppers Drug mart, Joe Fresh, Zehrs, and other Loblaw-owned supermarkets, the PC Financial Mastercard can help to amplify your PC Optimum points.

You have three President’s Choice Financial cards to choose from including the PC Financial Mastercard (entry-level), PC Financial World Mastercard, and PC Financial World Elite Mastercard.

You can read about all three here.

For the PC Financial Mastercard, you earn 10-25 points per $1 spent and you can redeem your points for free groceries and other household items.

  • Annual fee: $0
  • Interest rate: 19.97%
  • Rewards: PC Optimum points
  • Minimum income eligibility: N/A
  • Other perks: Purchase protection, extended warranty and 0.97% promotional balance transfer for 6 months
  • Learn more: How to maximize your PC Optimum points
PC Financial Mastercard
APPLY FOR THIS CARD

Annual Fee Credit Cards for New Immigrants in Canada

Scotiabank Passport Visa Infinite Card

This top travel rewards card is one of the best within its category in Canada.

You start off with a sign-up bonus worth $300 and enjoy no-FX fees, 2 points per $1 spent on groceries, dining, entertainment, and daily transportation, plus 1 point per $1 for everything else.

The Scotiabank Passport Visa card comes with comprehensive travel insurance (12 types), purchase security, car rental insurance, purchase protection, and extended warranty.

  • Annual fee: $139
  • Interest rate: 19.99% purchase and 22.99% cash advances
  • Rewards: $300 value sign-up bonus
  • Minimum income eligibility: $60,000
  • Other perks: Free Priority Pass membership with 6 free airport lounge visits (worth $379) per year
  • Learn more: Scotiabank Passport Visa infinite review
Scotiabank Passport Visa Infinite Card
APPLY FOR THIS CARD

American Express Cobalt

The AMEX Cobalt card is one of the best travel credit cards in Canada.

Earn up to 50,000 bonus points in the first year plus 5 points per $1 spent on grocery, restaurants, and food delivery. You also get 3 points for every $1 spent on streaming subscriptions; 2 points for every $1 spent on gas and travel, and 1 point per $1 spent on all other purchases.

This card offers comprehensive travel insurance benefits, rental car insurance, purchase protection, and extended warranty coverage.

  • Annual fee: $155.88
  • Interest rate: 20.99% purchases and 21.99% on cash advances
  • Rewards: points and comprehensive travel benefits
  • Minimum income eligibility: N/A
  • Learn more: AMEX Cobalt vs. Scotiabank Gold AMEX
American Express Cobalt Card
APPLY FOR THIS CARD

Scotiabank Gold American Express Card

Want to earn rewards where it counts? The Scotiabank Gold American Express card offers an industry-leading 5 points per $1 spent on groceries, restaurants, fast food, food delivery and food subscriptions, and entertainment.

In addition, you earn 3 points per $1 spent on gas and daily transit and 1 point on everything else.

This card waives the 2.5% foreign transaction fee, offers a discounted Priority Pass membership and you get free comprehensive travel insurance (8 types).

New applications enjoy 30,000 bonus points ($300 value) when you spend $1,000 in the first 3 months.

  • Annual fee: $120
  • Interest rate: 19.99% purchases and 22.99% cash advances
  • Minimum income eligibility: $12,000
  • Rewards: Points, $250 value sign-up bonus, and VIP benefits
  • Other perks: AMEX Invites
  • Learn more: Scotiabank Gold AMEX review
Scotiabank Gold American Express Card
APPLY FOR THIS CARD

Scotia Momentum Visa Infinite Card

Ranked as one of the best cash back credit cards in Canada, the Scotia Momentum Visa Infinite is worth checking out.

To start, you earn 10% cash back on $2,000 worth of purchases ($100 value) in your first three months.

Thereafter, you get 4% cash back on groceries, recurring bill payments and subscription purchases like Netflix; 2% on gas and daily transportation, and 1% cash back on all other purchases.

In addition, cardholders enjoy a comprehensive insurance package (11 types) including mobile device insurance.

  • Annual fee: $120; waived in the first year
  • Interest rate: 20.99% purchases and 22.99% cash advances
  • Rewards: cash back and comprehensive insurance
  • Minimum income eligibility: $60,000
  • Other perks: Visa Infinite benefits
  • Learn more: Scotia Momentum Visa Infinite review
Scotia momentum visa infinite
APPLY FOR THIS CARD

BMO Air Miles World Elite Mastercard

The BMO Air Miles World Elite Mastercard is considered to be one of the best Air Miles credit cards in Canada.

It offers a welcome bonus of 2,000 miles and you earn 1 mile per $10 spent. Additionally, you get a complimentary membership in Mastercard Airport Experiences provided by Loungekey (plus 2 free passes annually), comprehensive insurance coverage, and car rental discounts.

  • Annual fee: $120; waived in the first year
  • Interest rate: 19.99% purchases and 22.99% cash advances
  • Rewards: points and VIP perks
  • Minimum income eligibility: $80,000
  • Other perks: Mastercard World Elite benefits
  • Learn more: BMO Air Miles World Elite Mastercard review
APPLY FOR THIS CARD

Reasons Why You May Need a Credit Card

My mother had always been against the use of credit cards. She has heard all kinds of stories about how credit card debt has ruined people’s lives and her constant advice when I first travelled abroad was to stay away from credit cards.

Alas, life in Canada is a lot different from Nigeria and unless you have the cash to pay outright for a car or home, you will have to apply for a credit facility at some point.

Lenders want to see that you have a history of paying back your debts on time and they assess this using your credit report.

Credit card issuers and other lenders (e.g. banks) send regular reports to credit bureaus and this information is recorded on your credit report and informs your credit rating.

A good credit score makes it easier for you to qualify for competitive rates when you need a loan.

Some of the other reasons why you may want to get a credit card (in addition to building your credit history) are:

Greater Security: Most credit cards come with zero-liability protection which means that if your card is used for unauthorized transactions, you are responsible for the loss. Cash in the bank often does not offer this protection.

Free Rewards: You can enjoy free rewards and perks provided by your credit card. This could be in the form of:

  • Earn cash back i.e. earn cash back on every dollar you spend using your card.
  • Earn points: earn points you can redeem for free flights, merchandise, hotels, car rentals and more.
  • Insurance coverage ranging from comprehensive travel insurance (e.g. emergency medical, trip cancellation, hotel/motel burglary and travel accident) insurance, extended warranty, purchase protection and more.

Interest-Free Loan: A standard credit card offers an interest-free period of 21 days or so. During this “grace period,” you don’t pay interest fees. A 0% balance transfer credit card can save you a lot of money in fees for 6 months to 1 year.

Convenience: Some merchants simply do not accept any other form of payment other than a credit card. Renting a car? booking a flight? Shopping online? Need quick cash for emergencies? A credit card works really well…you just need to remember to pay off your outstanding balance on time.

Closing Thoughts

In some cases, newcomers or people with no credit history may be required to put down a security deposit in order to be eligible for a credit card i.e. secured credit card.

You can read more about those here.

After you have obtained your credit card, plan to grow your credit score by paying off your balance on time and in full, and limit your credit applications.

For more ideas on how to improve your overall financial picture, check out this post on how to raise your credit score fast.

Related reading

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Author

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Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. His writing has been featured or quoted in the Toronto Star, The Globe and Mail, MSN Money, Financial Post, Winnipeg Free Press, CPA Canada, Credit Canada, Wealthsimple, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

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