If you are in the market for a new credit card, you may want to look into a reloadable prepaid credit card. These cards almost function similarly to a debit card: you load the card with a set amount of money in advance, then any purchases are deducted from the available balance (rather than being paid off at the end of a billing cycle).
You can reload your card as frequently as you want (within reasonable limits—for example, some issuers may not allow you to reload 25 times in a single day), making it easier to resist spending when money is tight than it otherwise would be with a traditional credit card.
- Why use reloadable credit cards rather than a traditional credit card?
- CIBC Air Canada Conversion Visa Prepaid Card
- KOHO Mastercard Prepaid Card
- KOHO Premium Mastercard Prepaid Card
- Canada Post Cash Passport Prepaid Mastercard
- Wealthsimple Cash Visa Card
- Stack Prepaid Mastercard
- BMO Prepaid Mastercard
- Frequently asked questions about reloadable credit cards
Why use reloadable credit cards rather than a traditional credit card?
Although they are not as well-known as traditional credit cards, reloadable credit cards are excellent financial tools that can help you achieve your goals—especially if you have a low credit score or struggle with budgeting.
Since all purchases are paid for in advance, you do not actually require a credit check to open up a prepaid credit card, making the account type ideal if your poor credit score would prevent you from qualifying for a traditional card. Similarly, the lack of a hard credit check means that registering for a prepaid credit card will not negatively affect your score.
Prepaid credit cards can also help those who are not eligible for standard credit cards enjoy rewards or perks when making purchases. Although they generally do not come with all of the finer bells and whistles that a traditional credit card might advertise (for example, you can wave goodbye to extensive credit card travel insurance or a subsidized NEXUS pass), they do feature some perks. If you would otherwise use a debit card or cash to make a purchase, you may as well take advantage of some of the benefits.
The other major benefit of reloadable credit cards is that they give you finer control of your budget. Standard credit cards are notorious for making overspending easy.
Unfortunately, you may not even notice that you have gone drastically over budget until you receive your monthly statement—at which point you will have to repay all of your purchases or face steep interest rates.
If you instead have to reload a prepaid credit card, you set a hard cap on your spending in advance. Of course, you may always cave and add more money to the card, but at least you are aware of the expenses in advance.
CIBC Air Canada Conversion Visa Prepaid Card
If you are interested in using a prepaid reloadable credit card during your travels, the CIBC Air Canada Conversion Visa Prepaid Card is worth looking into. The prepaid card is free to order, does not have any reloading or currency conversion fees, and allows you to load a variety of different currencies on the same card.
However, big spenders should beware: you cannot store more than the equivalent of $20,000 CA on your CIBC Air Canada Conversion card. You also cannot load more than $3,000 CA (or the equivalent in other currencies) onto your card within a single 24-hour period.
Over the past year or so, the CIBC Air Canada Conversion prepaid card has also been a smart choice because of its 1% cash back. This reward might pale in comparison to some traditional cash back credit cards. But in the world of prepaid, reloadable credit cards, this is impressive.
If you are only interested in the CIBC Air Canada Conversion Visa Prepaid Card for its cash back offer, you may wish to check out the Wealthsimple Cash Visa Card or KOHO Premium Mastercard instead. The former offers 1% cash back on all purchases while the latter offers between 0.5% to 2% depending on purchase category. These last two cards have cash back offers as a standard, year-round benefits. This way you don’t have to worry about losing out on the perk.
KOHO Mastercard Prepaid Card
KOHO is building a name for itself as a great prepaid reloadable credit card, and for good reason. The free tier of their Mastercard Prepaid Card offers 2% cash back on transportation, groceries, and restaurant. It offers 0.5% cash back on everything else.
The card also provides a 1.2% interest rate on any unused funds after receiving at least one direct deposit. That is a reward for minimizing your spending and reloading your card promptly. Congratulations on building healthy financial habits!
Between the aforementioned financial perks and the lack of monthly fees, the KOHO Mastercard Prepaid Card is a tempting pick. However, users should still be aware of fees before opening up an account. KOHO charges 1.5% on all foreign currency purchases.
All things considered, the fees above are fair. However, if you are registering for a reloadable credit card in an effort to build strong financial habits, there are a couple of caveats that you should also keep in mind before opening an account.
KOHO is proud of the fact that they do not charge non-sufficient funds (NSF) fees. For many users, this is great: traditional banks charge up to $45 per NSF transaction, so it can be a relief to not have to worry about accidental charges.
Additionally, KOHO advertises a $60 credit-builder service, which basically entails opening up a line of credit that you can then (theoretically) use to build positive credit history. You can pay $10 a month for 6 months or $60 up front. Since the line of credit loan is a separate financial product, we are not going to delve into a detailed conversation of its pros and cons here.
Manage that debt
However, since it is advertised on the reloadable card’s page as a complementary product, we did want to give it a brief mention. If you are interested in a prepaid credit card because you have previously struggled to manage your debt or maintain your credit score, it may be risky to go with a card that has a loan so closely intertwined.
You do have the option to forgo the loan, but it is good to be aware of anything that might be a potential weakness down the road. Of course, the line of credit might also be a genuinely useful tool for rebuilding your credit. Ultimately, just be sure to carefully consider your circumstances before opening an account.
KOHO Premium Mastercard Prepaid Card
Fees: $9/month or $84 annually
Depending on your spending habits, it may be worth paying a little extra for the KOHO Premium Mastercard Prepaid Card. Although cardholders must pay $9/month or $84 annually, they receive 2% cash back on groceries, food, and transportation.
For reference, this means that the higher tier is worth it if you spend at least $470/month in the any of those categories. You save when you pay the annual $84 payment, or if you spend at least $600/month in the categories listed above but pay the $9 monthly fee.
Premium cardholders also enjoy a couple of other extra perks. If you enjoy travelling, you will be happy to hear that the reloadable credit card does not have any foreign currency exchange fees. Likewise, premium cardholders can take advantage of KOHO’s Price Match service (though you will have to constantly scan and email your receipts to the finance company, plus you may have to reach out to companies directly if KOHO detects a potential price match).
Ultimately, the Premium tier is still a relatively good deal, but we would recommend checking your monthly spending before opening up an account to make sure that the monthly fee is worth the extra cash back.
Canada Post Cash Passport Prepaid Mastercard
Cost to open: $15
Annual fee: $0
Rewards or notable perks: No conversion fees when purchasing currency, free backup card provided in advance
Supported currencies: Canadian dollars, U.S. dollars, Euros, British pounds, Japanese yen, Australian dollars, Mexican pesos
The Canada Post Cash Passport Prepaid Mastercard is a solid pick for avid travellers. You can load 7 different currencies onto the card (and do not have to worry about exchange fees when you initially load the money).
Plus, when you first purchase the physical card, Mastercard will also provide a free emergency backup card upon request (though this is only for your personal use, it is not a supplemental card for someone else). Keeping a backup card on you instead of ordering a replacement can prevent a lot of anguish.
However, the Cash Passport card is far much more useful abroad than it is in Canada. Although there are no extra fees when making a purchase in a foreign country, you will have to pay an extra 1.5% on all Canadian purchases.
You can also expect to pay an extra fee when withdrawing funds at a bank or automated teller machine (ATM), regardless of location.
Plus, although there are no currency conversion fees when loading funds onto your card, you will be charged a 3.25% foreign currency conversion fee on any funds that must be exchanged from another currency to make a purchase. For example, if you use $10 CA and $10 US to cover a ~$23 CA purchase, you will be charged an exchange fee on the USD portion of your payment.
The conversion fee structure may seem relatively minor at first glance, but consider what might happen if you are going on a one-off trip to Britain. You will have to figure out your budget in advance, stick closely to it, and then likely pay to convert the remaining British pounds to Canadian dollars once you have returned to Canada.
You may be able to use most of the funds, but it is unlikely that you will drop the balance to a perfect $0. As if that was not bad enough, you will have to pay a $3 CA reloading fee whenever you add more funds to your card and a $2.80 monthly fee after 12 months of inactivity.
All these fees do add up, but if you are frequently travelling abroad, the lack of conversion fees and the peace-of-mind knowing that you have a backup card may be well worth it. Just be sure to plan ahead in order to avoid unnecessary fees.
Wealthsimple Cash Visa Card
Annual fee: $0
Rewards or notable perks: 1% cash back
If you are looking for a simple, no-fuss cash back reloadable credit card, the Wealthsimple Cash Visa Card is an excellent choice. Cardholders earn 1% cash back on all purchases, a relatively competitive offer for a prepaid card. Plus, you can automatically put your cash back towards stock or cryptocurrency, making it easy to invest.
You can even direct the rewards to a Tax Free Savings Account (TFSA) or registered retirement savings plan (RRSP), streamlining the process even further. Just be sure to keep an eye on your contribution limits.
It can be nice to watch as your stock portfolio grows with each purchase, but Wealthsimple incentivizes saving, too. If you open a linked Wealthsimple bank account, you will earn a 1.5% interest rate on any unused funds loaded onto the prepaid credit card. However, even if you choose to only apply for the card, the Wealthsimple Cash Visa Card’s 1% cash back offer is still a great deal.
Stack Prepaid Mastercard
Annual fee: $0
Rewards or notable perks: Reimbursed currency conversion fees, partner rebates
Are you looking for a reloadable prepaid card that is both useful at home and affordable abroad? The Stack Prepaid Mastercard is a great pick. Though it does not offer standard cash back, the card does come with rebates for partnered establishments. Many of these establishments are genuinely useful, too: for instance, Stack is currently offering rewards at 18 grocery stores and 14 gas stations. Depending on your shopping habits, the partnered offers may genuinely be able to cut down on some of your bills.
As long as you use the Stack Prepaid Mastercard relatively frequently, it will be relatively competitive abroad, too. Stack charges you the equivalent price in Canadian dollars plus a 2.5% fee when you make a purchase in a foreign country.You cannot load funds in multiple currencies.
However, if you spend at least $350 CAD in a single month, Stack will reimburse the 2.5% fee (up to $25 per month). This perk can simplify the process of dealing with a reloadable credit card on vacation, especially if you tend to spend a lot while traveling.
BMO Prepaid Mastercard
Annual fee: $6.95
Rewards or notable perks: Extends manufacturer’s warranty, provides limited theft and damage coverage
The BMO Prepaid Mastercard is one of the most useful prepaid reloadable credit cards on this list, but ironically enough, BMO is all but ignoring the card’s biggest perk. BMO markets the Prepaid Mastercard as a travel card, but its forreign currency conversion fee is relatively high at 2.5% and the card does not come with other travel-related benefits.
If you are planning on going abroad, you would be better off taking the Canada Post Cash Passport Prepaid Mastercard or CIBC Air Canada Conversion Visa Prepaid Card with you. On the other hand, if you are going to make a big purchase, the BMO Prepaid Mastercard truly begins to shine.
Although many standard credit cards provide manufacturer’s warranty extensions, few reloadable credit cards offer the same perk. Fortunately, the BMO Prepaid Mastercard will double an original manufacturer’s warranty (up to one year) if an item is fully paid for on the card.
Similarly, the purchase will be covered under theft/damage insurance for 90 days. Even if you use another reloadable credit card for your day-to-day shopping, it may be worth it to pay a few dollars and open up a BMO Prepaid Mastercard just so that you can access its extended warranty when making big-ticket purchases.
Frequently asked questions about reloadable credit cards
Do you still have questions about reloadable credit cards? Be sure to check out our list of frequently asked questions below for help!
Visa offers both reloadable and non-reloadable prepaid cards. Both of the Visa cards listed above (the CIBC Air Canada Conversion Visa Prepaid Card and the Wealthsimple Cash Visa Card) are reloadable, as are many other cards offered in partnership with other financial institutions. However, Visa also offers ‘gift cards’ which essentially function as prepaid credit cards but cannot be reloaded.
Ultimately, if you are thinking about buying (or opening) a prepaid Visa card, it is a good idea to read the fine print and check if it is reloadable.
There is no universal way to reload a prepaid Visa card. Each card is issued in partnership with a different financial institution, and each institution sets different requirements for reloading their card. Generally, you can load the card via direct deposit or send money as a bill payment from your bank. Some cards may also support loading funds in-person (i.e. via cash). However, you should check with the partnered institution to find out exactly which methods are available for your card.
Unfortunately, standard Vanilla Visa and Mastercard prepaid cards are not reloadable. However, MyVanilla cards can be reloaded.
You cannot reload a standard Vanilla prepaid card. However, you can reload a MyVanilla card by purchasing a Vanilla Reload card in-store, then applying the balance to your account online.
Visa has partnered with many different financial institutions and fintech companies to offer prepaid reloadable cards, including CIBC, Desjardins, Digital Commerce Bank, H&R, TruCash, KOHO, MOGO, and We Financial. To obtain a card, you will have to apply through one of these institutions. We highly recommend that you compare each card’s benefits and fees before submitting any applications.
No, American Express prepaid gift cards are not reloadable.
Since all prepaid Visa cards are offered in conjunction with another financial institution and each institution determines its own card’s reload methods, it may be possible to reload some prepaid Visa cards with Paypal. However, Paypal is not a standard reload method and you should not automatically expect that you will be able to use it to reload any given prepaid Visa card.