What Are The Best Credit Cards For Teens in Canada?

As teens approach adulthood, they need to become informed on how credit cards operate and which ones are ideal for them. Luckily, there is a wide selection of credit cards here in Canada that provide not only incentives such as cash back and travel points but also offer low-interest rates with no annual fees! With these options, teenagers can make sound financial choices while simultaneously building up their credit scores.

Best prepaid cards for teens in Canada

Prepaid cards offer teenagers the convenience and protection of a card without having to worry about debt. Depending on which issuer you choose, many providers allow for online or app management. To add money to your teen’s prepaid card is simple – all that needs to be done is to transfer funds from your bank account into their designated one.

KOHO Prepaid Mastercard

Fees: $48 per year for “Essential”, $104 per year for “Extra” and $228 per year for “Everything”

Spending Limit: Same as account balance

User Age: The age of majority

With KOHO, teenagers can budget, spend, save, and monitor their funds in one place! This no-fee account combines the advantages of a regular spending account with those of a prepaid credit card. Plus, when teens upgrade to KOHO Extra or Everything they can receive up to 2% cash back on groceries, transportation and eating – making managing money easier than ever before!

The KOHO prepaid Mastercard is a secure financial resource for teens, as it enables them to make both online and in-store purchases without needing access to either debit or credit cards. With this low-risk tool, they will only be able to spend the money that has already been deposited into their account – making it much safer than relying on traditional forms of payment like credit cards.

Credit Building Hack: By registering for KOHO’s Credit Builder plan, your teen can start building their credit score without needing to apply for a credit product like a credit card – at a cost of just $10 monthly with the Easy plan, $7 if you have an Essential or Extra plan, or only $5 with the Everything subscription.

KOHO’s app simplifies money management — from real-time transaction tracking and budgeting goals to custom analytics on spending habits. Plus, their 24/7 customer service team is always available for chat or phone support, so you never have to feel alone when handling your finances. All these benefits make KOHO Financial – Reloadable Prepaid Mastercard one of the best prepaid credit cards for teens.

Best secured credit cards for teens in Canada

Secured credit cards are the perfect start for teenagers who don’t yet have a credit history. These cards require a security deposit in case young adults fail to pay their bills, providing card issuers with some financial protection.

Neo Secured Card

Fees: No annual fee

Credit Limit: Equal to security deposit

User Age: Age of majority

With Neo Secured Card, teens can easily build their credit score without the typically high security deposit required by other secured cards. All it takes is an initial deposit of just $50 to get started. You’re guaranteed to receive at least 0.5% cash back from select retailers like Earl’s Restaurants, Harry Rosen and Well.ca every month – even if your total partner cash back is less than 0.5%. Plus, enjoy a generous credit limit ranging between $2,500 to $10,000!

Not only that, but they offer competitive interest rates between 19.99% – 24.99%, plus a 5% instant partner cashback incentive when shopping at their partners. You will also earn 15% cashback when you make your first purchase.

Best standard credit cards for teens in Canada

If your teenagers are eligible for a standard credit card, Canada offers an array of choices. These cards provide cash back and reward points that will not only help build their positive credit history but also offer other benefits.

Scotiabank® Scene+™ Visa* Card

Fees: No annual fee, supplementary cards for free

Authorized user age: No restriction but must be at least 14 years to enroll in the Scene+ program

With this card, teens have the potential to earn double Scene+ Points for each dollar spent at Sobeys, Safeway, Foodland, and Cineplex! As an added bonus, they can also get a 1,250-point reward upon their very first use of the card. Furthermore, there is no minimum age restriction for authorized users.

The Scotiabank® Scene+™ Visa* Card is an ideal way to help teach adolescents the fundamentals of financial responsibility while still reaping the benefits of reward points. With these rewards, teens can redeem complimentary movie tickets or other prizes from SCENE’s extensive selection.

The card includes a 0$ annual fee and Visa payWave™ technology. With the card’s fast transaction speed and secure payment methods, teenagers are able to make purchases with ease.

Tangerine Money-back Credit Card

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The Tangerine Money-Back Credit Card provides teens with a secure introduction to credit cards. It’s an amazing tool that helps your teen, who reached the age of majority and is a primary or secondary cardholder, to build a solid foundation for their credit score.

This card is the perfect tool to teach teens how to manage their finances responsibly. With no annual fee and generous cashback offers, this card allows users to earn up to 2% rewards in three chosen spending categories plus 0.5% on all other purchases – an attractive financial incentive for young people! Plus, if they spend up to $1,000 dollars within two months of opening their account, then they can get a bonus of 10% cashback (up to $100).

The Tangerine Money-Back Credit Card is a strong choice for teens, thanks to its very competitive interest rates. From a 19.95% purchase and cash advance rate, you can be sure that if you carry over a balance from month to month, the card won’t break your budget with heavy interest charges.

RBC Cash Back Mastercard

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This card offers unbeatable value with no annual fee, an economically friendly purchase rate of 20.99%, and a cash advance rate of 22.99%. Plus, you can obtain a secondary card absolutely free.

With the RBC Cash Back Mastercard, you can shop in peace, knowing that your purchases are safeguarded for up to $50,000 per year. If an item purchased with this card is destroyed or stolen within 90 days of its original transaction, the purchase security and extended warranty protection will cover it for up to $500. The RBC Cash Back Mastercard is the ideal credit card for teens in 2023. It’s specially designed to make it easy and safe for kids aged 14+ to manage their money with the help of a Family Card Option.

Best students credit cards in Canada

Student credit cards are designed specifically for young adults enrolled in college or university in Canada. Most of these cards require applicants to be 18-24 years old and enrolled and provide perks that are focused on meeting students’ needs.

Students – BMO CashBack® Mastercard®*

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When you sign up for this card, you’ll receive a bonus of 5% cash back in your first 3 months, plus a generous 1.5% cashback on eligible purchases after 12 consecutive monthly payments are made.

The Students BMO CashBack® Mastercard®* was designed with the modern student in mind, providing top-notch rewards and features that make handling money easy. With this card, you can gain a generous 3% cash back on up to $500 spent on groceries each month and 1% cashback up to $500 for your frequent bills every month (0.5% thereafter). Plus, get access to exclusive discounts from BMO’s partners as well as 24/7 customer service support.

Students – BMO AIR MILES®† Mastercard®*

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The BMO AIR MILES®† Mastercard®* presents students with an amazing opportunity to earn their rewards as they continue their studies. With this card, you’ll accumulate 1 mile for every $25 spent on eligible purchases and even 2 or 3 miles for every $25 spent from select categories. Plus, benefit from a special bonus of 800 reward miles when your first purchase is made within two months of opening the account.

The BMO AIR MILES®† Mastercard®* is an ideal choice for students as it not only provides the opportunity to build their credit history but also rewards them on all day-to-day purchases. Moreover, users are granted exclusive discounts from partner retailers and 24/7 customer service support.

CIBC Aventura® Visa* Card for Students

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The CIBC Aventura® Visa* Card for Students is a fantastic way for young adults to kickstart their financial journey. This student credit card comes with no annual fee, so teens can enjoy all the benefits of having a credit card without worrying about any additional expenses. Not only that, but they will also receive up to 2,500 bonus Aventura Points when they sign up!

Teens have the chance to experience limitless entertainment and shopping with the rewards points obtained from this card. They can also save on their holiday costs, such as flights and hotels, by redeeming these points, or if they ever find themselves needing some spare cash, then cash advances are available through any CIBC banking centre or ATM located around Canada!

Teens will appreciate the ease of managing their accounts digitally or by using the CIBC Mobile Banking App. With this convenience, they can check their balance and transactions on the go without having to make an extra trip.

CIBC Aventura® Visa* Card for Students is the right choice for teens who want to conveniently start developing their credit history, as well as benefit from the additional advantages that come with this credit card.

What age do you have to be to get a credit card in Canada?

In Canada, individuals must be 18 in Ontario, Alberta, Manitoba, Quebec, Prince Edward Island, and Saskatchewan, or 19 in Nova Scotia, New Brunswick, British Columbia, Northwest Territories, Newfoundland and Labrador, Nuvanut and Yukon to get their own credit card. But if your child is younger than that, they may become a joint credit card holder – some issuers don’t have age restrictions for authorized users and others have a minimum age requirement of 13-16 years. This would be great for teenagers who long to have a credit card of their own.

What is the difference between an authorized user and a secondary cardholder?

There are two main options available for joint credit cards. You can either add your teenager as an authorized user with their own card attached to your existing account, or you can apply with them for a joint credit card. Authorized users are granted access to the card without being held financially liable for any transactions made, whereas joint credit cards hold both parties equally responsible for the account.

Authorized user

Adding an authorized user, sometimes called a secondary cardholder, is convenient since it doesn’t require much paperwork, but likely won’t help your teen build a credit score, unfortunately. Some credit card issuers report account information to the credit bureaus for both the primary account holder and authorized user. This could help your teen build a credit history early on, but they won’t benefit from the payment history. It’s important to contact the credit card provider to determine if they report to the credit bureaus on behalf of the authorized user, and how that may or may not help your teen build their credit.

Having said that, authorized users still enjoy other benefits that come with a credit card, such as cashback and rewards. And it still provides a great opportunity to teach your teen how credit cards work and how to use them responsibly.

Joint credit card

Alternatively, opening a joint credit card with your teen can give them the opportunity to build their credit score as long as they use it responsibly. However, in order to be a joint credit card holder of a credit card and have full responsibility for any debts incurred, one must reach the age of majority of either 18 or 19 depending on the province of residence.

Guarantor

For someone who wouldn’t typically qualify for a credit card, they might still be able to get one with the help of a guarantor. A guarantor won’t have access to the credit card account, but they’ll be the one who’s ultimately responsible for any unpaid debts on the account. According to the Government of Canada website, a guarantor is often the “parent or guardian of a minor.” This suggests that some credit card issuers may let you guarantee a credit card for a teen who is under the age of majority.

By establishing a healthy credit score and history, they will be ready to face financial challenges when they become adults. By setting your kids up the necessary habit to build and maintain a good credit score, you’re paving the way for them to enjoy better credit cards that come with more perks and even access loans at lower rates.

How teens can build a credit score in Canada

In most cases, to build a credit score, teenagers must reach the age of majority. In addition to that, only certain cards will allow users to build a credit score. There are several types of cards issued in Canada, including prepaid, debit, secured, and unsecured or standard credit cards.

Unlike prepaid and debit cards, secured cards can actually help teens build their credit score — as long as they make regular minimum payments each month. Secured cards require an initial security deposit, and the credit limit is usually equivalent to the deposited amount.

In contrast, unsecured or standard credit cards generally provide higher credit limits and can help young adults establish their credit rating at a quicker rate. However, teens may not qualify for them as they typically require a minimum income and established credit. So, the best way for teens in Canada to build a credit score is to start with secured cards and then switch to standard unsecured credit cards.

Credit card programs for university students

For university students, credit card issuers may offer exclusive programs that can provide benefits such as greater credit limits and lower interest rates. It’s worth researching these programs since they are often linked to universities and available for any student who meets the age and income requirements.

Banking programs for medical students in Canada

Canadian medical students looking for additional financial security and rewards should explore the exclusive programs offered by multiple banks. These programs are created to accommodate potential expenditures related to medical school and provide higher credit limits.

Scotiabank’s Healthcare+ Physician Banking Program offers medical students exclusive banking solutions and benefits. Participants of this program can get Scotiabank Passport™ Visa Infinite* Card and Scotiabank Gold American Express® Credit Card, which come with a pre-approved credit limit of up to $10,000. Cardholders also receive other benefits, including reward points and insurance coverage.

Medical, Dental and Optometry Student Banking Bundle by CIBC provides a credit card with higher credit limits for students. CIBC Aventura® Gold Visa* Card offered to medical and dental students comes with a minimum credit limit of $10,000, while the minimum credit limit offered to optometry students is $5,000.

NBC banking programs for professional students

National Bank of Canada provides special credit card offers for students enrolled in programs leading to a professional degree or certification. There are special credit card programs available for engineering, law and business, and teaching students.

All the aforementioned programs exist to facilitate professional students in covering tuition fees, textbooks, and other educational expenses. Students may receive higher credit limits and become cardholders of Platinum Mastercard® without paying the annual fee for the first three years.

TD Bank banking program for professional students

TD Bank provides a banking solution for young professionals who need to manage their educational costs. Students enrolled in professional degree and certification programs are eligible for a TD Aeroplan Visa Platinum* Card or TD Platinum Travel Visa Card. In addition, cardholders can take advantage of waived annual fees as well as welcome bonus points.

Now that we’ve explored the diverse banking programs available to teens let’s take a look at the best credit cards for teens in Canada. Whether your teen is searching for a student card or just beginning their journey with credit cards, there are plentiful opportunities out there.