The KOHO Essential Mastercard is one of the best prepaid cards in Canada.
Unlike traditional prepaid credit cards, the KOHO Essential Mastercard offers cash back rewards on your purchases and can be used to build your credit history.
Read on to see how it works and comparisons with the entry-level KOHO Easy Mastercard and top-of-the-line KOHO Premium Mastercard.
KOHO Essential Mastercard Overview
KOHO Essential Prepaid Mastercard
$20 sign-up bonus after first purchase
Earn up to 5% cash back
1.50% savings interest on your balance
$4 monthly fee
KOHO Essential Mastercard Benefits
The KOHO Essential Card can easily replace your debit card if you want to earn cash back on all purchases.
Since it is a prepaid card, you will need to load it with funds from a chequing or savings account at another financial institution.
And you can set it up to receive your paycheque and earn on every dollar.
The main benefits of this KOHO Prepaid Mastercard include the following:
Earn Cashback
The KOHO Essential Mastercard pays 1% cash back on groceries, restaurants, and bill payments.
For all other purchases, you earn an unlimited 0.25% cash back.
At participating retailers, cardholders earn up to 5% cashback. Cashback partners offering 2-5% rewards as of this writing included Chefs Plate, Indigo, Pizza Pizza, Baskin Robbins, Contiki, Frank and Oak, and Open Farm.
Earn Interest
You will earn 1.50% interest on your card balance. So, the funds sitting on your card continue working for you.
This perk is not a regular feature of prepaid or debit cards. Another recent prepaid card offering interest on your balance is the EQ Bank Card.
Credit Building
This optional add-on helps users build their credit scores.
When you subscribe to KOHO Credit Building for $7 monthly, your subscription payment is reported to a credit bureau. Timely payments improve your score over time.
Lower FX Fees
Standard credit cards charge a 2.5% to 3% foreign currency conversion fee when you make payments abroad. The KOHO Essential Mastercard charges a lower 1.50% rate, a saving of up to 1.50% each time you complete a foreign currency transaction.
Budgeting Features
You can use the KOHO app for insights into your spending. It also allows you to set automated savings goals using the RoundUps tool.
Other Perks
This card offers guaranteed approval, and you can qualify for it with any credit score (no credit check).
Because it is not a credit card, you won’t be paying interest fees, as you are spending cash.
Funds in your KOHO account are held at a Canadian bank, where they enjoy deposit insurance provided by the Canadian Deposit Insurance Corporation (CDIC).
Lastly, you get a $20 welcome bonus when you sign up, enter our promo code, and complete your first purchase within 30 days.
Downsides of the KOHO Essential Mastercard
The KOHO Essential Mastercard has a $4 monthly fee and will cost you $48 annually.
If you use this card only for its cashback rewards, a no-fee credit card may offer better rewards. Alternatively, you can opt for the free KOHO Easy Card.
Secondly, it does not include insurance coverage for purchases which comes standard with most credit cards.
Lastly, credit building is not a standard feature. You will need to subscribe separately to the program for $7 per month.
How To Apply For The KOHO Essential Mastercard
To apply for the KOHO Essential Prepaid Mastercard, you must be a resident of Canada and at least 18 years old (age of the majority).
Click here to complete the online application form. This link includes a $20 offer using the CASHBACK referral code.
Your new physical card is sent by mail within days. You also get a virtual KOHO card for easy online payments.
KOHO Easy vs. KOHO Essential vs KOHO Premium Prepaid Cards
| Prepaid Cards | KOHO Easy Mastercard | KOHO Essential Mastercard | KOHO Premium Mastercard |
| Monthly fee | $0 | $4 | $9 |
| Cashback rewards | 1% on groceries, bills, and services | 1% on groceries, restaurants, bills, and services; 0.25% elsewhere | 2% on groceries, gas, transit, and restaurants; 0.50% elsewhere |
| Cashback at partners | Up to 5% | Up to 5% | Up to 5% |
| Interest earned on balance | 0.50% | 1.50% | 2% |
| Credit building fee | $10/month | $7/month | $7/month |
| Physical and virtual cards | Yes | Yes | Yes |
| FX Fee | 1.50% | 1.50% | 0% |
| Learn more | Visit | Visit | Visit |
KOHO Essential Mastercard Review FAQs
Yes, you earn cashback at Costco and Walmart when paying with the KOHO Prepaid Mastercard.
No, the KOHO Essential Mastercard is not a credit card. However, you can use it to build your credit score if you subscribe to the credit-building tool.
Get a $20 bonus when you join using our promo code: CASHBACK.
