Owning a credit card means that you’ll likely pay high-interest rates. The average interest rate on credit cards in Canada falls between 19% and 29%, which is extremely high if you don’t pay off your credit card balance in full and on time. If you have an average monthly credit card balance of $2,000, you’ll have to pay between $380 and $580 per year in interest fees alone. However, there’s a way to avoid paying those additional interest fees (or at least decrease them), and it’s by using a balance transfer credit card. We’ve selected the 10 best balance transfer credit cards with the most beneficial promotions available in Canada using our credit card comparison tool!
What’s a balance transfer credit card?
First and foremost, a balance transfer credit card is one that offers a lower introductory interest rate (or in some cases, zero interest) for a set period of time. It gives you the option of transferring the balance from your current credit card onto it so you pay less interest. However, it’s important to remember that the balance transfers offered by those credit cards are only available for a short period of time and after the offer ends, the regular interest rate will apply.
How to choose the right balance transfer credit card
One way to choose the right balance transfer credit card is to shop around for balance transfer offers and compare the various terms. On average, promotional balance transfer rates are around 2% for a period of six months. This may seem like a reasonable period of time but after the promotional period ends, the interest rate returns to its usual higher level. Even though the transfer interest rates are relatively low, it’s important to also look at each card’s regular interest rate to avoid surprises once the promotion ends. One other aspect to consider when selecting a balance transfer credit card is the transfer fee. These are the additional fees charged when you transfer your balance onto this credit card and they’ll be included in your balance. This can vary between 1% to 3% of the amount transferred. Lastly, some banks may require a minimum credit score when applying for a new balance transfer credit card.
Scotiabank Value Visa
Balance transfer promotion: 0.99% for 6 months; 12.99% afterwards
The Scotiabank Value Visa card can help you save hundreds of dollars in interest. Its very low-interest rate of 12.99% on purchases and cash advances is one of the lowest on the market today. The current welcome offer is a 0.99% introductory interest rate on balance transfers for the first six months. The Scotiabank website features a calculator that helps you determine how much money you can save using the Scotiabank Value Visa card. For example, let’s say your credit card balance is $1,500 with an interest rate of $19.99%. By using the Scotiabank Value Visa card, you’ll be able to save $195 in interest in your first year. Its low-interest rate is a great way to pay off all your large purchases. Lastly, you can transfer balances from higher interest rate credit cards to this credit card, which will help you save on interest and pay off your debt faster. This card has an annual fee of $29 and a minimum credit limit of $500. Just like other Scotiabank credit cards, you can also enjoy discounts at Avis rental car locations around the world.
CIBC Select Visa
Balance transfer promotion: 0% for 10 months; 13.99% afterwards
The CIBC Select Visa has a low-interest rate balance transfer option that can help you reduce interest payments. You can transfer up to 50% of your credit limit. The current welcome offer enables you to transfer your existing credit card balance to the CIBC Select Visa card and get 0% interest for 10 months with a 1% transfer fee.
This card comes with passenger protection, which includes a $100,000 common carrier accident insurance. The CIBC Select Visa has an annual fee of $29 (but it’s free during your first year), and up to 3 additional cards are free. The interest rate is 13.99% for both purchases and cash advances. The minimum annual income required to apply is $15,000 per household.
BMO Preferred Rate Mastercard
Balance transfer promotion: 3.99% for 9 months; 12.99% afterwards
The BMO Preferred Rate Mastercard offers a low-interest rate to help you save more money. This card has an interest rate of 12.99% on purchases and cash advances (the lowest of all BMO credit cards) and an annual fee of $20. The current welcome offer is a 3.99% introductory interest rate on balance transfers for nine months, with a 1% transfer fee, and no annual fee during the first year.
The BMO Preferred Rate Mastercard also comes with purchase protection, which covers your purchases from theft or damage for 90 days from the date of purchase. Extended warranty coverage is available, which doubles the warranty period up to a maximum of one additional year. Just like any BMO credit card, you’ll receive discounts on Cirque du Soleil performances in Canada and Las Vegas.
BMO Air Miles Mastercard
Balance transfer promotion: 1.99% for 9 months; 22.99% afterwards
The BMO Air Miles Mastercard helps you earn flights faster on every purchase made using the card. You can receive one Air Mile for every $25 purchased with your card, 3 times the Air Miles for every $25 spent at participating Air Miles partners, and lastly, earn twice the miles when you use your BMO Air Miles Mastercard at participating partners. The BMO Air Miles Mastercard has no annual fee and an interest rate of 19.99% for purchases and 22.99% for cash advances. The current welcome offer is a bonus of 950 Air Miles (the equivalent to $100 towards purchases with Air Miles Cash) and a $1.99 introductory interest rate on balance transfers for 9 months with a 1% transfer fee. A BMO Air Miles calculator is available on the BMO website. It’s a really helpful tool to find out how many Air Miles Reward Miles you can receive using this credit card. For example, let’s say you spend an average of $1,000 with your card, which means you’ll receive a total of 1,622 Air Miles rewards in your first year. These can be exchanged for a flight from Vancouver to Seattle (for 1,300 miles ), a digital camera (1,600 miles ), or a cash reward of $170.74.
Some of this card’s additional benefits include more Reward Miles when you add another cardholder for free, an extended warranty and purchase protection, discounts at participating National Car Rental and Alamo Rent a Car locations, and lastly, discounts to go see Cirque du Soleil on tour.
PC Financial World Elite
Balance transfer promotion: 0.97% for six months; 21.97% afterwards
The PC Financial World Elite is a great card to earn PC Optimum Points towards free groceries. Each $10 spent with the card equals 10,000 points. You can earn 45 points for every dollar spent at Pharmaprix and you can also earn 30 points for every dollar spent in stores like Wholesale Club, Maxi, Provigo, PC Travel, or Esso. Earn 10 points for every dollar spent everywhere else. The PC Financial World Elite has an interest of 20.9% on purchases and 22.97% on cash advances (21.97% in Quebec). You get a promotional rate of 0.97% on balance transfers for 6 months, but after the promotion ends the balance transfer fee returns to the cash advance rate applicable in your province.
The PC financial website features a calculator that can help you determine how many PC points you could accumulate over your first year. For example, let’s say you spend $200 on any purchase-related to your health per month, $160 on fuel, $200 on travel, $150 on groceries, and $400 on everything else. This is a total of 1,100 in monthly purchases, which equates to $193 in PC Optimum points annually (a total of 193,200 points). As soon as you reach 10,000 points, you can easily redeem them for up to $10 worth of free products in any participating grocery store or online.
Some of the additional benefits included with this card are emergency medical travel insurance (covers those under age 65 during trips up to 10 days), a car rental collision/loss damage waiver insurance, and identity theft assistance, and a concierge service. A minimum annual personal income of $80,000 (or $150,000 per household) is required to apply for a new PC Financial World Elite Mastercard.
BMO Cash Back Mastercard
Balance transfer promotion: 1.99% for 9 months; 19.99% afterwards
The BMO Cash Back Mastercard lets you earn back the most cash back on all types of purchases. You can earn 3% cash back on your grocery purchases, 1% cash back on recurring bill payments, and 0.5% cash back on everything else. The current welcome offer is 5% cash back in your first three months and a 1.99% introductory interest rate on balance transfers for nine months, with a 1% transfer fee. The great thing about a cash back credit card is that your rewards never expire as long as your account is open. You can also redeem your cash back anytime you want for as little as $1. The BMO Cash back Mastercard has no annual fee, with an interest rate of 19.99% on purchases and 22.99% for cash advances. A cash back calculator is also available. For example, let’s say you spend $500 on groceries per month, $50 on recurring bill payments, and $500 on all other expenses, which means you’ll accumulate a total cashback of $368 in your first year.
Some additional benefits this card includes is additional cash back when you add another cardholder for free, an extended warranty and purchase protection, discounts at participating National Car Rental and Alamo Rent a Car locations, and finally discounts on Cirque du Soleil on tour performances.
Tangerine Money Back Mastercard
Balance transfer promotion: 1.95% for 6 months; 19.95% afterwards
The Tangerine Money-Back Mastercard helps you save money on everyday purchases. The key feature of this card is the monthly money-back reward. You can earn 2% money back on your everyday purchases in two categories that you select (groceries, furniture, restaurants, hotel, fuel) and 0.5% money back on all other everyday purchases. You can also earn more cash back when you deposit your rewards into your Tangerine savings account, you will then get a third category in which you will receive 2% money back. This card comes with automatic earning. You can earn money back rewards automatically on everyday purchases and be paid monthly. This will be applied to your credit card balance and redeemed into your savings balance. There is no limit on how much you can earn on your money back reward. A welcome offer is available now that enables you to transfer your balance and pay only 1.95% interest during the first 6 months, which returns to 19.95% after the promotion ends. This card has no annual fee and the balance transfer fee is 3% of the amount transferred ( a minimum of $5).
Some additional benefits that come with this card are purchase protection and an extended warranty. This insurance coverage is up to $60,000 and covers loss, theft, or damage for 90 days from the date of purchase. The extended warranty will double the period of repair services to a maximum of one year. The annual income required to apply for this credit card is $12,000.
MBNA True Line Gold Mastercard
Balance transfer promotion: 10.99% at all times
The MBNA True Line Gold Mastercard has a low-interest rate and a low balance transfer rate to help you save more money on interest. This card has an annual fee of $39, with an interest rate on purchases of 10.99% and 20.99% on cash advances, and 10.99% on balance transfers. Some additional benefits include purchase protection, which covers most items purchased with your card for the first 90 days from the date of purchase. The limit total accumulative is $60,000 per account. The MBNA True Line Gold Mastercard can also help you save with Avis Rent A Car and Budget Rent A Car. You can save a minimum of 10% in Canada and 5% internationally.
Tangerine World Mastercard
Balance transfer promotion: 1.95% for 6 months; 19.95% afterwards
The Tangerine World Mastercard offers all the same features as the Tangerine Cash Back credit card but with more features. Just like the other Tangerine card on this list, the Tangerine World Mastercard has a monthly cash back reward. You can earn 2% cash back on your everyday purchases in two categories of your choosing (groceries, furniture, restaurants, hotel, fuel, etc.) and 0.5% money back on all other everyday purchases. You can also earn more cash back when you deposit your rewards into your Tangerine savings account, as you will then get a third category in which you can receive 2% cash back. There is no annual fee on this credit card, and it carries a 19.95% interest rate on both purchases and cash advances. A promotional balance transfer interest rate is available now. Enjoy 1.95% interest for the first 6 months (19.95% after that). The balance transfer fee is 3% of the amount transferred or a minimum of $5.
The additional benefits this card has is the Boingo Wi-Fi for Mastercard. It keeps you connected with access to over 1 million Wi-Fi hotspots around the world. You will have access to Mastercard Travel Rewards, which unlocks cashback offers and gets a rebate applied directly to your statement at merchants that accept Mastercard while travelling outside of Canada. This card also comes with rental car collision/loss damage insurance as well as mobile device insurance. The Tangerine World Mastercard comes in handy when travelling. It gives you access to the Mastercard Airport Experience provided by Loungekey, which includes exclusive dining, retail and spa access in over 400 airports worldwide, along with over 1000 lounges at $32 a visit.
No-Fee Scotiabank Value Visa Card
Balance transfer promotion: 3.99% for 6 months; 16.99% afterwards
The No-Fee Scotiabank Value Visa Card allows you to save more money with its low-interest rate of 16.99% on purchases and cash advances. This credit card helps you save more with its combination of low interest and no annual fee. It’s one of Scotiabank’s most affordable credit cards that will help you finance your medium to large purchases. A welcome offer is available right now and gives you a 3.99% introductory interest rate on balance transfers for the first six months. This card has a minimum credit limit of $500 and required a minimum annual income of $12,000. Lastly, like other Scotiabank credit cards, you can also enjoy discounts at Avis rental car locations throughout the world.
This article was compiled by Hardbacon, which has designed a credit card comparator listing hundreds of Canadian credit cards. Hardbacon also helps you save on savings accounts, chequing accounts, online brokers, robo-advisors, life insurance, mortgages and personal loans. If you want to go one step further and take control of your finances, you should download Hardbacon’s mobile app, which links to your bank and investing accounts, helps you plan for your financial goals, create a budget and invest better.