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10 Best Low Interest Credit Cards in Canada in Feb 2023

If you routinely carry a credit card balance that accrues interest charges, a low-interest credit card can save you hundreds to thousands of dollars in interest costs.

The standard purchase rate on most credit cards is around 19.99%. On some credit cards, the rates can be even higher at up to 25%!

Check out this list of the best low interest rate credit cards in Canada for cards with interest rates ranging from 9.95% to around 12.99%.

Lowest Interest Credit Cards in Canada

When you are struggling to pay off your credit card debt, a low-interest rate balance transfer credit card can be useful for taking off the pressure for 6-12 months.

During this time, try paying for purchases with cash and work at paying off your balance quickly. If you must make a credit card purchase, use a low-interest rate credit card that cuts your purchase APR by up to 50% or more.

Some low-interest credit cards also offer a promotional balance transfer which makes for a perfect combination. However, note that some of these credit cards quickly jack up your rates if you miss any payments.

1. Scotiabank Value Visa Card

  • Purchase APR: 12.99%
  • Balance transfer offer: 0% for 6 months
  • Annual fee: $29 (waived in the first year)
  • Income requirement: $12,000
  • Best for: low interest rates and balance transfers

The Scotiabank Value Visa is a top contender in the line-up of low-interest rate credit cards in Canada.

It offers a regular 12.99% APR on purchases, cash advances, and balance transfers. New cardholders also get a competitive 0% introductory low balance transfer rate for 6 months, with a 1% balance transfer fee.

Read this Scotiabank Value Visa Card review for more details about the card.

Pros:

  • 0% introductory interest rate on cash advances
  • First year annual fee rebated 

Cons:

  • No points redemption 
  • $29 annual fee
No-Fee Scotiabank Value Visa Card

2. HSBC +Rewards Mastercard

  • Purchase APR: 11.9%
  • Annual fee: $25
  • Income requirement: N/A
  • Best for: earning rewards on everyday purchases

For a card that has low interest rates for everything, the HSBC +Rewards Mastercard ticks all the boxes.

Cardholders pay 11.90% interest on purchases, cash advances, and balance transfers which is significantly lower than the regular 19.99% you get with most cards.

It also offers cash back rewards on everyday purchases at 2 points per $1 for dining and entertainment purchases and 1 point per $1 on everything else.

This Mastercard provides price protection, extended warranty, and purchase assurance coverage. It has a $25 annual fee.

Read my HSBC +Rewards Mastercard review for more details.

Pros:

  • Generous welcome bonus 
  • Earn points with the HSBC Plus Rewards Program
  • Insurance coverage 
  • Price protection service 
  • Cash advance rate is also low

Cons:

  • Rewards offerings aren’t the best
hsbc-plus-rewards-mastercard

3. National Bank Syncro Mastercard

  • Purchase APR: 4% + Prime (10.70% minimum)
  • Annual fee: $35
  • Income requirement: N/A
  • Best for: new purchases with lower interest

National Bank’s Syncro Mastercard is one of Canada’s lowest-interest credit cards.

Cardholders pay a variable purchase interest rate that is 4% plus the Prime rate. When you transfer balances for debt consolidation purposes or withdraw cash, you pay 8% plus the Prime interest rate.

This card also offers purchase protection and extended warranty coverage. You can take a look at other National Bank credit cards.

Pros:

  • Purchase protection & extended warranty insurance included 
  • No minimum income requirement 

Cons:

  • The interest rate may change based on the prime rate 
  • $35 annual fee
National Bank Syncro

4. BMO Preferred Rate Mastercard

  • Purchase APR: 12.99%
  • Balance transfer offer: 0.99% for 9 months
  • Annual fee: $20
  • Income requirement: $15,000
  • Best for: low-interest balance transfers

If you are struggling with high-interest rates on your current credit card, the BMO Preferred Rate Mastercard can save you a tonne in interest fees.

You enjoy a standard 12.99% APR on purchases, 15.99% for cash advances, and a 0.99% promotional balance transfer rate for 9 months. Note that a 2% transfer fee applies.

Other perks offered by this card are:

  • Purchase protection for up to 90 days
  • Extended warranty for up to a maximum of one extra year
  • Discount on admission tickets to Cirque du Soleil shows in Canada

Read this BMO Preferred Rate Mastercard review.

Pros:

  • Low interest on balance transfers for the first 9 months
  • First-year annual waived

Cons:

  • No insurance coverage included  
  • No earning and redeeming of points or cash back
BMO Preferred Rate Mastercard

5. MBNA True Line Gold Mastercard

  • Purchase APR: 8.99%
  • Annual fee: $39
  • Income requirement: N/A
  • Best for: low interest purchases along with rental car benefits

The MBNA True Line Gold Mastercard offers an 8.99% regular interest rate on purchases and balance transfers. Its low purchase and balance transfer APR means you save on interest fees even if you carry a balance.

Note that a 3% balance transfer fee (minimum $7.50 fee) applies, and if you withdraw cash, the rate for cash advances is 24.99%.

This card also provides cardholders basic insurance coverage, including purchase protection and extended warranty coverage.

Learn more about the card in this MBNA True Line Gold Mastercard review.

Pros:

  • Very low non-promotional interest rate 
  • Purchase assurance and extended warranty benefits 
  • Save up to 10% at Avis and Budget car rental locations 

Cons:

  • $39 annual fee 
  • You don’t earn rewards on purchases
MBNA True Line Gold Mastercard

6. MBNA True Line Mastercard

  • Purchase APR: 12.99%
  • Annual fee: $0
  • Income requirement: N/A

With the MBNA True Line Mastercard, you pay 12.99% on purchases and balance transfers. Note that a 3% fee applies to balance transfers ($7.50 minimum fee).

On cash advances, there’s a hefty 24.99% interest rate. Read this MBNA True Line Mastercard review for more information.

Pros:

  • No annual fee
  • 0% promotional interest rate for 12 months on balance transfers 

Cons:

  • High 24.99% interest rate on cash advances 
  • No rewards or insurance coverage
MBNA True Line Mastercard

7. TD Emerald Flex Rate Visa

  • Purchase APR: 4.50% to 12.75% + TD Prime
  • Balance transfer offer: N/A
  • Annual fee: $25
  • Income requirement: None
  • Best for: low-interest purchases for those with a good credit score

If you have a very good credit score, you could score a competitively low interest rate with the TD Emerald Flex Rate Visa card. Cardholders pay a variable purchase interest rate of 4.50 to 12.75% plus the Prime rate.

Note that since the TD Prime Rate can vary, the interest rate you pay over time can go up or down. Also, your rate will depend on TD’s assessment of your credit rating.

Additional benefits of the card are:

  • Purchase security and extended warranty
  • Get up to a 10% discount when you rent a vehicle at participating Avis Rent a Car and Budget Rent A Car locations

Pros:

  • No income requirement 
  • Purchase interest rate could be low if you have a good credit score (variable rate depends on the Prime rate)

Cons:

  • Interest rate can vary based on the prime rate 
  • $25 annual fee 
TD emerald flex rate visa

8. CIBC Select Visa Card

  • Purchase APR: 13.99%
  • Annual fee: $29
  • Income requirement: $15,000
  • Best for: no interest balance transfers 

The CIBC Select Visa Card has a welcome offer of 0% interest on any balances transferred for up to 10 months with a 1% transfer fee. The first year’s annual fee is also rebated. 

This credit card comes with valuable common carrier accident insurance of up to $100,000, with the option to add travel medical insurance for an additional fee. 

You also get up to 10 cents off per litre of gas at participating Chevron, Ultramar, Fas Gas, and Pioneer gas stations. 

Pros:

  • 0% interest on balance transfers for up to 10 months
  • Common carrier accident insurance included 
  • Save up to 10 cents per litre on gas 

Cons:

  • No earning or redeeming of points 
  • $15,000 minimum income requirement 
cibc select visa

9. RBC Visa Classic Low Rate Option

  • Purchase APR: 12.99%
  • Annual fee: $20
  • Income requirement: N/A
  • Best for: those who want coverage on purchases with a low interest rate

The ​​RBC Visa Classic Low Rate Option offers a low interest rate of 12.99% on purchases and cash advances. 

It includes purchase security and extended warranty insurance, as well as savings on gas at Petro-Canada.

RBC partnered with Rexall to earn you 50 Be Well points for every $1 spent. You’ll also get a complimentary 3-month DashPass subscription. 

Pros:

  • Low, non-promotional interest rate 
  • Save at Petro-Canada and earn more points at Rexall
  • No minimum income requirement 

Cons:

  • No low balance transfer interest rate 
  • No earning and redeeming of points 
  • Not much insurance is included 
rbc visa classic low rate option

10. Capital One Low Rate Guaranteed Mastercard 

  • Purchase APR: 14.99%
  • Annual fee: $79
  • Income requirement: N/A
  • Best for: building or rebuilding credit 

With this Capital One Mastercard, you are guaranteed approval, no matter your credit history. If you don’t qualify for the Low Rate Guaranteed Mastercard, you’ll be approved for a Secured Card with a security deposit. 

You’ll qualify if you meet these conditions:

  • You’re the age of majority in your province or territory
  • You haven’t applied for a Capital One account more than once in the past 30 days
  • You don’t have an existing account or pending application
  • You don’t have an account that wasn’t in good standing for the past year 

This credit card comes with valuable travel benefits, including travel assistance, baggage delay insurance, and common carrier travel accident insurance. 

It also includes purchase assurance and extended warranty coverage along with a car rental/loss damage waiver. 

Pros:

  • Guaranteed approval  
  • Valuable travel and everyday benefits 
  • Build your credit quickly

Cons:

  • You’ll get a secured card if you don’t qualify for the Low Rate Mastercard 
  • No earning and redeeming of points or cash back 
Capital One Low Rate Guaranteed Mastercard

Credit Cards With Low Interest Rates in Canada (Summary)

Credit CardAnnual FeePurchase APRPromotional Interest RateIncome requirement 
Scotiabank Value Visa Card$29 (first year waived)12.99%0% on cash advances for the first 6 months$12,000
HSBC +Rewards Mastercard$2511.90%N/AN/A
BMO Preferred Rate Mastercard$2012.99%0.99% on balance transfers for 9 months$15,000
National Bank Syncro Mastercard$354% + prime rate (min. 9.95%)N/AN/A
MBNA True Line Gold Mastercard$398.99%N/AN/A
MBNA True Line Mastercard$012.99%0% on balance transfers for 12 monthsN/A
TD Emerald Flex Rate Visa$25TD Prime +4.50% to 12.75%N/AN/A
CIBC Select Visa Card$2913.99%0% on balance transfers for up to 10 months$15,000
RBC Visa Classic Low Rate Option$2012.99%N/AN/A
Capital One Low Rate Guaranteed Mastercard$7914.99%N/AN/A

Methodology:
Savvy New Canadians rates the best low interest credit cards based on their annual fees, purchase interest rates, rewards, top features, insurance coverage, introductory offers, and other perks. We carefully evaluate each credit card and place more weight on the value of the long-term rewards it offers. Only credit cards we would personally use are recommended. While these credit cards are some of the best on the market, but may not be right for you. Visit the credit card issuer’s website using the links to confirm each product’s terms and conditions before applying.

How Is Credit Card Interest Calculated in Canada?

Credit card interest can be a bit complicated, so it’s worth finding out exactly how it works when considering applying for a new credit card.

The Annual Percentage Rate (APR) is the first to look at. This is the rate of interest that you will pay on the card expressed as an annual percentage. For example, it may be something like 22.99% for a standard credit card and something like 12.99% for a low interest credit card.

However, this can be a bit misleading because you are charged daily interest, and the interest compounds.

You don’t just pay back 22.99% of your balance once a year. Instead, you are charged interest daily and pay it off monthly.

For example:

  • If the APR is 22.99%, you will owe a daily interest of 22.99% divided by the number of days in a year, which gives you a daily rate of 0.063%. You can do this with any card by dividing the APR by 365.
  • If you had a $4,000 balance on your credit card, after one day, you would owe $2.52 in interest (0.063% x $4,000).
  • As a result, your balance would go up to $4,002.52 the next day.
  • The next daily interest charge is calculated based on this new balance using the previous calculation.
  • As such, the interest compounds – you are charged interest on top of the interest added the day before.
  • However, if you pay your balance in full each month, you won’t pay any interest.

Remember that the APR may differ for standard purchases and cash advances. In general, it’s higher for cash advances.

How Much Can You Save with a Low-Interest Credit Card?

Using a low-interest credit card is a good way to save money compared to using a high-interest card. But how much can you save?

Let’s say you owe $2,000 on your card and plan to pay off $400 monthly.

The first card has an APR of 19.99% and the second card has an APR of 7.99%

With the higher-interest card, it would take six months to pay off your balance, and you would pay $102.72 in interest.

The low-interest card would still take six months to pay off your balance, but the total interest would be $40.

Standard CardLow-Interest Card
Interest Rate19.99%7.99%
Time to Pay Off Balance6 months6 months
Interest Owed$102.72$40

With this example, it becomes clear how much you can save. But, of course, this is just an example. You may be able to save even more money depending on the size of your balance and the interest rate of your standard card compared to a lower-rate card.

How to Choose a Low-Interest Credit Card in Canada

There are many low-interest credit cards to choose from, and you might want to start by looking at the cards on this page.

But how should you choose the right one for you?

  • Begin by looking at the different interest rates the cards offer. While you may want to choose the card with the lowest interest rate, which would make sense, make sure you consider other factors as well. For example, the purchase APR, the cash advance APR, and the annual fees.
  • If you see a suitable card, find out whether you are eligible. Read the fine print and check all the requirements because you don’t want to waste your time applying for a card when you are unlikely to be accepted.
  • Does the card offer balance transfers? Some low-interest cards can give you the option of transferring a balance with a low-interest rate or no interest rate. If you are interested in this option, try to find a card that offers it.
  • Carefully consider your spending habits when you are choosing a card. The lowest interest rate may be best if you want to pay off your debt and just have a card for emergencies. But if you need regular cash advances, you must also keep the cash advance APR in mind. What about if you want to make big purchases? A perk like an extended warranty offered by the card may make it more suitable in this case.
  • Some cards have the same rate on all types of spending, but many have different rates for purchases, cash advances, and balance transfers. Know all the details to avoid any nasty surprises.
  • Many cards charge an annual fee. If your primary goal is to reduce your spending, you may be against paying for another product. But always do your calculations because a low-interest card can be worth it, depending on how much you can save in interest.
  • While these cards usually have fewer perks, it’s still worth considering them. You may be interested in travel insurance, points, and more, which can make the card more tempting.

Other Ways to Avoid or Reduce Credit Card Interest

Credit card interest is known for being high, and a low-interest credit card is an option if you want to reduce the interest you pay. But there are other options for paying less or no interest.

  • The most obvious way to pay less interest is to pay your monthly balance in full by the due date. If you can do this, you won’t pay any interest on your credit card. However, this may not be the case for cash advances, so keep that in mind.
  • You could set up your monthly payments automatically, so you never have to worry about missing a payment. This helps you to pay your card balance back consistently.
  • Balance transfer credit cards are another option. With these, you switch your balance to a new credit card with a lower interest rate or 0% interest for a set period. This way, you can reduce or eliminate interest payments, allowing you to pay off your balance sooner.
  • Don’t just pay the minimum each month. It seems like the easy option, but you will end up paying more back in interest over time.
  • If you have several debts, consider paying off high-interest debts first and just pay the minimum payments on your other debts to reduce the interest you pay.
  • While it may not always be feasible, try to use a debit card or cash more frequently and only use a credit card when you have to.

Benefits of Low-Interest Rate Credit Cards

If you are considering low interest credit cards, here are some of the most important benefits you can enjoy:

  • The most obvious benefit is that you will pay lower interest rates. As we’ve looked at in this guide, the savings can be significant. If you carry a large balance and you can transfer to a card with a lower interest rate, you could make an important saving.
  • Annual fees are typically quite low for these cards, and some have no fee. This is because they don’t come with too many extra features like rewards and the main focus is on saving on interest.

Downsides of Low Interest Rate Credit Cards

Now, let’s take a look at the disadvantages of low-interest credit cards:

  • One disadvantage is that they don’t usually come with great rewards. A few provide rewards and perks, but the primary purpose of these cards is to offer lower rates. You are probably not that focused on rewards and your primary goal is to save on the interest you pay, but this can make them look less inviting than other cards.
  • Remember that you will still pay some interest on most cards. This is unlike balance transfer cards, where you may be able to get 0% interest for a set period. If a balance transfer card gives you enough time to pay off your debt, it may be a better option.

Why Should You Get a Low Interest Credit Card?

If you have a large balance that you want to pay off, a low-interest credit card may be a good option for you.

With so many credit cards available, choosing one that offers particular perks or interesting rewards like cash back is tempting. However, a low-interest card may be a better option if you simply want to reduce your interest so you can pay your balance off sooner.

Alternatively, if you have no problem paying back your balance every month and you haven’t built up a large debt, you may prefer to find a credit card with a higher interest rate but more perks.

Review your situation, including your debt, how you spend, and your financial goals. What do you want to achieve with your credit card? If a low interest credit card looks like a good option, find a suitable card and consider applying for it.

Is a Low Interest Credit Card Worth It?

A low-interest credit card can save you money over time. See the example below.

Assuming you owe $1,000 on your credit card, if your card has a 19.99% purchase interest rate and you are making $500 in monthly payments, it will take you 25 months to pay off the debt and cost $2,289 in interest fees.

However, if your credit card’s purchase APR is 8.90%, you pay off the loan 3 months earlier (in 22 months) and only pay $868 in interest fees. A savings of over $1,421!

Conclusion

A low-interest credit card can help you shave off unnecessary fees while you pay off your credit card balance. 

Read the fine prints accompanying these cards on the issuer’s website by clicking on the “Apply” links above. Some of the cards jack up their interest rates when you miss several payments within a 12-month period.

Overall, aim to pay off your balance within the grace period so that you can avoid interest charges altogether.

Best Canadian Low-Interest Rate Credit Cards FAQs

What is considered a low-interest rate for a credit card?

The average credit card interest rate in Canada is 19.99%. Credit cards with rates below 14.99% are considered to have lower interest rates.

What credit card in Canada has the lowest interest rate?

Credit cards with the lowest interest rates include the National Bank Syncro Mastercard, Scotiabank Value Visa, and MBNA True Line Gold Mastercard.

Related Posts:

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Author

Gravatar for Enoch Omololu, MSc (Econ)
Enoch Omololu, MSc (Econ)

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 is passionate about helping others win with their finances and has been writing about money matters for over a decade. He has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, CBC News, Financial Post, Toronto Star, CTV News, Canadian Securities Exchange, Credit Canada, National Post, and many other personal finance publications. You can learn more about him on the About Page.

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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