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Best Low-interest Credit Cards in Canada for 2023

Best Low-interest Credit Cards in Canada for 2023

Best low interest rate credit card

In this article, we provide a listing of the best low-interest credit cards in 2023

Introduction

When choosing a credit card, one of the most important factors to consider is the interest rate it charges. While credit cards can be valuable financial tools, high-interest rates can make it challenging to pay off balances on time.

According to a survey by lendingtree.com, over 65% of credit card holders do not clear their full monthly balances on time. The good news is that some credit cards have lower interest rates compared to traditional credit cards, which can help you save money and make it easier to pay back the amount you borrowed.

In this article, we will explore some of the best low-interest credit cards that are available in Canada in 2023. Alongside the interest rates, we will also outline the pros and cons of each card. By the end of this article, you will have a clear understanding of which credit card is best suited for your financial needs.

MBNA True Line Mastercard

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.5/5

$39

10.99% (20.99% – cash adv)

No

Pros

  • Low-interest rate
  • Low annual fees needed
  • No minimum household income requirements
  • Has a balance transfer offer of 0% for 12 months
  • Can add up to 9 authorized users with no additional annual fee for each user

Cons

  • High credit score requirements
  • No welcome bonus
  • No cash back and other rewards opportunities
  • Eligible to Canadian residents who are of the age of majority in their province/territory of residence.
  • Insurance coverage includes purchase protection and extended warranty

RBC Rate Advantage Visa

Best low-interest credit cards in 2023 RBC RateAdvantage Visa

Overall Rating

Annual Fees

Interest

Insurance Coverage

5/5

$0

4.99% – 8.99%

Yes

Pros

  • Good insurance coverage
  • No annual fees needed
  • Offers competitive interest rates
  • Offers option travel and balance protection.
  • Offers rewards perks such as fuel savings, Be well points, 0 delivery fee for door dash for 3 months.

Cons

  • It has a high credit score requirement to qualify for their low-interest rates
  • No welcome bonus
  • 3% balance transfer fees
  • Insurance coverage includes purchase protection, travel insurance, medical insurance, trip cancellation, delayed and lost baggage, rental and mobile device

BMO Preferred Rate Mastercard

Best low-interest credit cards in 2023 BMO Preferred Rate Mastercard

Overall Rating

Annual Fees

Interest

Insurance Coverage

4/5

$29

13.99% (15.99% – cash adv)

No

Pros

  • Low-interest rate
  • No annual fees for the first year
  • No minimum income requirements
  • Offer extended warranty
  • Low annual fee compared to the competition.
  • No fee for additional cardholder.
  • Annual fee rebate option if a BMO performance chequing account is owned

Cons

  • No rewards program
  • Balance transfer fees apply
  • You should be a Canadian resident and have a Canadian credit file to be eligible
  • You should be the age of majority in the province or territory where you live to be eligible
  • Travel and purchase insurance available

Desjardins Odyssey Visa Infinite Privilege

Best low-interest credit cards in 2023 Desjardins Odyssey Visa Infinite Privilege

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.3/5

$295 – $395

10.90%

Yes

Pros

  • Great insurance coverage and rewards program
  • Low interest rate, including for cash advances
  • Generous cash back opportunities mainly for travel (3% for travel and groceries) and easting out (4% cash back on all dining, entertainment, alternative transport)

Cons

  • One of the highest annual fees
  • High minimum income requirement (at least $150,000
  • Requires a relatively high credit score compared to the competition
  • Insurance coverage includes Purchase Security and Extended Warranty and Mobile Device Insurance

RBC Visa Classic Low Rate Option

Overall Rating

Annual Fees

Interest

Insurance Coverage

5/5

$20

12.99%

Yes

Pros

  • Low interest rates.
  • Offers travel insurance.
  • Offers purchase protection and extended warranty coverage.
  • No fee for additional cardholders.
  • Offers rewards perks such as fuel savings, Be well points, 0 delivery fee for door dash for 3 months.

Cons

  • Limited rewards and cash back opportunities
  • No welcome bonus
  • Insurance coverage includes Auto Rental Collision and Loss Damage Insurance, plus extra protection for new purchases with Purchase Security and Extended Protection Insurance

Scotiabank Value Visa Card

Best low-interest credit cards in 2023 Scotiabank Value Visa Card

Overall Rating

Annual Fees

Interest

Insurance Coverage

4/5

$29

12.99%

Yes

Pros

  • Low interest rate which includes cash advance
  • The interest is at 0% for the first six months
  • Welland purchase security.
  • No fee for additional cardholders.

Cons

  • No cashback opportunities
  • Limited insurance coverage options
  • $500 minimum credit limit
  • Insurance coverage includes Travel Medical, Trip Cancellation/ Interruption, Flight/Trip Delay, Delayed and Lost Baggage, Auto Rental Collision / Loss Damage and Travel Accident

TD Emerald Flex Rate Visa

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.8/5

$25

4.50% – 12.75%

Yes

Pros

  • Low interest rate
  • No income requirements
  • Offer tavel insurance
  • Low credit score requirements.
  • No fee for additional cardholders.
  • 50% more Stars at participating Starbucks stores.
  • Save at least 5% with Avis Rent A Car and Budget Rent A Car.

Cons

  • Offers a welcome bonus
  • The Annual Percentage Rate (APR) can go up to $24.99 if you don’t make timely payments
  • Limited insurance and cashback opportunities
  • Insurance coverage includes purchase protection, mobile and travel coverage, and extended warranty available

MBNA True Line Gold Mastercard

Best low-interest credit cards in 2023 MBNA True Line Gold Mastercard

Overall Rating

Annual Fees

Interest

Insurance Coverage

3.9/5

$39

10.99% (20.99% – cash adv)

Yes

Pros

  • Low interest rate
  • Extended warranty and purchase protection
  • Relatively low credit score requirements than most credit cards
  • No fee for 9 additional cardholders.
  • Trip Assistance and Legal Assistance
  • Save at least 5% with Avis Rent A Car and Budget Rent A Car

Cons

  • Relatively high annual fee compared to most low-interest credit cards
  • No welcome bonus
  • High cash advance interest.
  • 10.99% standard interest rate on purchases and balance transfers.
  • To be eligible, you must have reached the age of majority in the province in which you live & not declared bankruptcy in the past seven years
  • You must be a Canadian citizen or permanent resident to be eligible
  • You must meet minimum income requirements: $80,000 (individual) or $150,000 (household)

CIBC Select Visa Card

Best low-interest credit cards in 2023-CIBC-Select-Visa-Card

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.2/5

$29

13.99%

Yes

Pros

  • Annual fee waived in the first year
  • Comes with several insurance packages
  • Offers a welcome bonus of 0% interest for up to 10 months and 1% balance transfer fee
  • Relatively low interest rate
  • No transaction fee for money sent abroad
  • Save up to 10 cents per liter.

Cons

  • Minimum household income requirement of $15,000.
  • No cashback or reward opportunities
  • Comprehensive travel and purchase insurance available
  • To be eligible, you must be a Canadian resident and have a Canadian credit file
  • You should be the age of majority in the province or territory where you live to qualify for this card

HSBC +Rewards Mastercard

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.2/5

$25

11.90%

Yes

Pros

  • Welcome bonus with a value of up to $135.
  • Offers 2 points for every $1 cashback on eligible dining or entertainment purchases.
  • Offers several insurance packages.

Cons

  • Relatively high credit score requirement.
  • $10 per additional cardholder.
  • Offers comprehensive insurance packages such as Travel Insurance (Trip Cancellation, Trip Interruption, Travel Emergency Medical, Travel Accident Insurance), New Mobile Device Insurance, Rental Car Collision Loss/Damage Insurance and Purchase Security & Extended Warranty Protection

National Bank Syncro MasterCard

Best low-interest credit cards in 2023 National Bank Syncro MasterCard

Overall Rating

Annual Fees

Interest

Insurance Coverage

3.8/5

$35

12.9%

Yes

Pros

  • Low interest rates
  • No minimum income requirement
  • The interest rate is based on your credit score
  • No charge for additional cardholder.

Cons

  • Limited rewards program
  • High charges for balance transfer.

Home Trust Secured Annual Fee Visa Card

Best low-interest credit cards in 2023 Home Trust Secured Annual Fee Visa Card

Overall Rating

Annual Fees

Interest

Insurance Coverage

4.5/5

$59

14.90% (19.80% Cash – adv)

Yes

Pros

  • Relatively low credit score requirements (good option for those with bad credit)
  • No minimum income requirement.
  • Can help you control your spending limit due to the upfront deposit
  • Secured card option helps to build credit

Cons

  • High annual fee
  • No insurance packages
  • Very limited rewards program
  • Charges 2% on foreign currency conversion
  • Requries $500 minimum deposit
  • Minimum income eligibility ($80,000 or $150,000 for household)
  • Insurance coverage includes Travel Emergency Medical Insurance and Car Rental Collision/Loss Damage Waiver Insurance, 

Vancity enviro Gold Visa (Low Rate Rewards)

Best low-interest credit cards in 2023 Vancity enviro Gold Visa (Low Rate Rewards)

Overall Rating

Annual Fees

Interest

Insurance Coverage

4/5

$145

11.25%

Yes

Pros

  • Low interest rate
  • No minimum income requirement
  • Up to 4 complimentary secondary cards with no extra fees
  • Offers several types of insurance.
  • 1 point for every $1 spent on purchases.

Cons

  • Doesn’t offer any rewards on purchase
  • Requires a high credit score (725 – 759)
  • Slightly higher annual fee compared to other competing card options
  • You must live in British Columbia
  • Insurance coverage includes Mobile Device and Purchase Security,  Extended Warranty and add-on travel insurance

Vancity enviro Classic Visa (Low Rate)

Overall Rating

Annual Fees

Interest

Insurance Coverage

4/5

$25

11.25%

Yes

Pros

  • Offers competitive interest rates.
  • No minimum income requirement.
  • Offers 3 types of insurance.
  • Low annual fee compared to the competition.
  • Up to 4 complimentary secondary cards with no extra fees.

Cons

  • No rewards program.
  • Requires relatively high credit score to qualify (725 -759)
  • Insurance coverage such as Flight & Baggage Delay, Hotel Burglary, Lost or Stolen Baggage, Travel Accident and Car Rental Theft and Damage

About low-interest credit cards

What is a low-interest credit card?

Have you been wondering what a low-interest credit card is? Well, I have the answer for you.

It is a type of credit card that comes with relatively lower interest rates when compared to traditional credit cards. Traditional credit cards usually come with interest rates between 15 to 25%. Meanwhile, low-interest credit cards have interest rates generally ranging from 10 to 15%.

Choosing a card with a lower interest rate makes it easier to pay off your monthly balance and save money on interest payments. That being said, it is important to note that low-interest cards may not offer as many rewards or benefits as traditional credit cards. So, it’s essential to weigh your options before making a final decision. But if your primary concern is to save money on interest payments, low-interest credit cards could be the best option for you.

Pros and cons of low-interest credit cards

Pros

  • Lower interest rates: The relatively low-interest rates are the primary benefit of getting a low-interest credit card. Most low-interest credit cards have an interest rate of around 10 to 15%.
  • More affordable debt repayment: Since the interest is low, debt repayment is more affordable, allowing you to pay off your debt more quickly.
  • Can help you improve your credit score: Lower interests make it a lot easier to clear your monthly balances in time, which ultimately boosts your credit score in the long run.
  • Low annual fees: Low-interest credit cards usually have low annual fees. Their annual fees usually range between $20 to $40, which is below the average for most traditional credit cards.

Cons

  • Fewer or no rewards: Most low-interest rate cards do not offer as many rewards or benefits as traditional credit cards.
  • Limited credit limit: The credit limit of these cards is usually lower than that of standard credit cards.
  • High credit score requirements: Low-interest credit cards usually require having a good or excellent credit score to qualify. People with fair or poor credit scores do not qualify for these cards.

Hidden fees: Some low-interest credit cards may come with annual fees, balance transfer fees, and other hidden fees that could increase the cost of owning the card over time.

Factors to consider before choosing a low-interest card

Besides interest rates, there are several other factors that you must consider when choosing a credit card. Some of these factors include the following;

  • Variable vs. fixed interest rate: When choosing a low-interest rate, it is crucial to determine whether their interest rate is fixed or variable. Fixed interest rates remain the same over time. On the hand, a variable rate may change based on market conditions.
  • Fees: Consider all the fees associated with the card, including annual fees, balance transfer fees, or late payment fees. Read the terms and conditions of the card issuer to identify any other hidden fees that apply to the card if you don’t meet certain conditions.
  • Rewards: One of the things you will notice about low-interest credit cards is that they may not offer as many rewards or benefits as traditional credit cards. However, there are some that are pretty generous.
  • Credit limit: This is the maximum amount that will be added to your card for you to spend. So, make sure it is high enough to meet your needs while still within your repayment means.
  • Credit score: Most low-interest cards target people with good credit scores (above 700 points). So, make sure your credit score is strong enough, or at least work towards improving your score, prior to applying for these cards.

How to get a low-interest credit card?

Here is the typical step-by-step procedure you will go through to acquire a low-interest credit card.

  • Check your credit score: As mentioned earlier, low-interest cards usually target individuals with good or excellent credit scores. So, start by checking your credit score by visiting either Equifax or Transunion to ensure it meets the card issuer’s requirements.
  • Research credit card options: We have shared some of the best low-interest credit cards. So, take time to compare their features, rewards, fees, and other pros and cons to choose one that serves your financial needs.
  • Apply for the card: When you are sure your credit score meets the card issuer’s minimum requirements, go ahead and apply for the card. The application can be made online or in person, depending on the card issuer you choose. You must provide your personal information, including your name, address, income, employment status, social security number, and any other details your card issuer may need.
  • Receiving and activating card: Once your application is accepted, your card issuer will send the credit card via mail or any other delivery option they choose to use. It is important to note that the review process can sometimes take several weeks, so you will need to be patient. Upon receiving the card, you will have to activate it using the attached guidelines. After activation, you can start using the card immediately.

Making the right credit card choice

To help you make an informed decision, we recommend outlining your financial priorities before choosing a credit card. Ask yourself questions like:

  • what are the primary uses of the credit card?
  • Will you be carrying a balance, or will you be paying off the balance in full every month?

Answering these questions will help you determine which credit card will be the most beneficial for your specific needs.

If you’re unsure where to start, you can explore the best low-interest credit cards mentioned above. These cards can help you save money on interest and make it easier to pay back your credit in a timely manner.

Final thoughts

In this article, we have explored the best low-interest credit cards in Canada. Choosing one of these cards will enable you to enjoy lower interest rates, reduced stress, and access more affordable debt repayment. The key factors you need to keep in mind when choosing a low-interest card include fees, rewards, and credit limits.

Despite the many benefits of low-interest cards, they are not a substitute for responsible spending and budgeting. Once you have successfully acquired one, always remember to spend responsibly and make your payments on time.

This will increase your credit score, allowing you to get higher credit limits and other benefits of having a good or excellent credit score. It is also important to note that low-interest credit cards do not offer as many rewards as most traditional credit cards.

Keep in mind that low-interest credit cards are not one-size-fits-all. While they may be ideal for some individuals, they may not meet the needs of others. Ultimately, the best credit card for you will depend on your specific financial situation and priorities. By understanding your needs and exploring different options, you can choose the right credit card to help you reach your financial goals.

Frequently Asked Questions

It is not compulsory to pay your credit card balance in full. However, this can significantly reduce your debt burden and ultimately lead to improved credit score overtime. You should nonetheless pay off the minimum sum monthly.

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