Let's take a look at the biggest offers, the pros and cons of each card, and how you can go about applying.
The Borrowell Team
Jun 05, 2024
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If you want to take control of your finances, especially when dealing with debt or planning big purchases, credit cards with low interest rates can be your best friend. They allow you to save significantly on interest charges, making it easier to chip away at your balance and stay out of the debt cycle.
These cards are especially advantageous for those who usually carry a monthly balance. With a lower interest rate, more of your payment goes toward the principal, helping you reduce your debt faster. Plus, many of these cards come with additional perks that can make managing your money even more rewarding.
In this guide, we’ll explore the best low interest credit cards in Canada. We’ve done the legwork to find the best options out there, considering various needs and preferences. From cards with the lowest purchase interest rates to those offering excellent balance transfer deals, we’ve got you covered.
Read our methodology to see how we selected the credit cards in this article.
Benefits of Choosing a Low Interest Credit Card
Low interest credit cards are designed to help you save money on interest charges, making them an excellent choice for individuals who carry a balance month-to-month or need to finance large purchases. By opting for a card with a lower Annual Percentage Rate (APR), you can minimize the amount of interest you pay, allowing more of your payments to go towards reducing your principal balance.
Tips for Choosing the Right Low Interest Credit Card
Selecting the right low interest credit card depends on your individual financial situation and needs. Here are some tips to help you make the best choice:
Assess Your Financial Needs:
Consider your spending habits, income, and whether you typically carry a balance. A low interest card can save you money on interest charges f you carry a balance. If you pay off your balance each month and don’t carry a balance (thus avoiding interest charges), you’ll get more benefits from a rewards credit card with a higher interest rate.
Calculate Potential Savings:
Use a credit card calculator to estimate how much you could save on interest with a low interest card compared to your current credit card. This can help you determine if the card's benefits outweigh any balance transfer or annual fees.
Consider Balance Transfer Options:
If you have existing credit card debt, look for a card with a low or 0% balance transfer offer. This can help you pay off your debt more efficiently by reducing interest charges during the offer period.
Key Features to Consider for Low Interest Credit Cards
When choosing a low interest credit card, there are several essential features to keep in mind:
Annual Percentage Rate (APR):
The APR represents the annual cost of borrowing, expressed as a percentage. A lower APR means you'll pay less in interest over time.
Balance Transfer Offers:
Many low interest cards offer promotional rates on balance transfers, which can help you consolidate and pay off debt more efficiently.
Annual Fees:
Some low interest cards come with no annual fee, while others may charge a fee. It's important to weigh the benefits of the card against its cost.
Additional Perks:
Look for cards that offer added value through perks like purchase protection, extended warranties, and travel insurance.
Key Takeaways
| Category | Credit Card | Purchase Interest Rate (APR) | Cash Advance Interest Rate (APR) | Balance Transfer Interest Rate (APR) | Annual Fee |
|---|---|---|---|---|---|
| Best for Low Purchase Interest Rates | MBNA True Line® Gold Mastercard® | 10.99% | 24.99% | 24.99% | $39.00 |
| Category Best for Low Purchase Interest Rates | Credit Card MBNA True Line® Gold Mastercard® | Purchase Interest Rate (APR) 10.99% | Cash Advance Interest Rate (APR) 24.99% | Balance Transfer Interest Rate (APR) 24.99% | Annual Fee $39.00 |
| Best for Low Interest Balance Transfers | MBNA True Line® Mastercard® | 12.99% | 24.99% | 0% for 12 months (3% fee) | $0.00 |
| Category Best for Low Interest Balance Transfers | Credit Card MBNA True Line® Mastercard® | Purchase Interest Rate (APR) 12.99% | Cash Advance Interest Rate (APR) 24.99% | Balance Transfer Interest Rate (APR) 0% for 12 months (3% fee) | Annual Fee $0.00 |
| Best for Low Interest Cash Advances | TD Low Rate Visa Card | 12.90% | 12.90% | 12.90% | $25.00 |
| Category Best for Low Interest Cash Advances | Credit Card TD Low Rate Visa Card | Purchase Interest Rate (APR) 12.90% | Cash Advance Interest Rate (APR) 12.90% | Balance Transfer Interest Rate (APR) 12.90% | Annual Fee $25.00 |
| Best Variable Rate Credit Card | RBC RateAdvantage Visa | Prime + 4.99% to 8.99% | Prime + 4.99% to 8.99% | N/A | $0.00 |
| Category Best Variable Rate Credit Card | Credit Card RBC RateAdvantage Visa | Purchase Interest Rate (APR) Prime + 4.99% to 8.99% | Cash Advance Interest Rate (APR) Prime + 4.99% to 8.99% | Balance Transfer Interest Rate (APR) N/A | Annual Fee $0.00 |
| Best Low Interest Cashback Card | Desjardins Odyssey Visa Infinite Privilege | 11.90% | 12.90% | N/A | $295 for Desjardins members, $395 for non-members |
| Category Best Low Interest Cashback Card | Credit Card Desjardins Odyssey Visa Infinite Privilege | Purchase Interest Rate (APR) 11.90% | Cash Advance Interest Rate (APR) 12.90% | Balance Transfer Interest Rate (APR) N/A | Annual Fee $295 for Desjardins members, $395 for non-members |
| Best Low Interest Credit Card with No Annual Fee | RBC RateAdvantage Visa | Prime + 4.99% to 8.99% | Prime + 4.99% to 8.99% | N/A | $0.00 |
| Category Best Low Interest Credit Card with No Annual Fee | Credit Card RBC RateAdvantage Visa | Purchase Interest Rate (APR) Prime + 4.99% to 8.99% | Cash Advance Interest Rate (APR) Prime + 4.99% to 8.99% | Balance Transfer Interest Rate (APR) N/A | Annual Fee $0.00 |
| Best Low Interest Credit Card for Free Global Money Transfers | CIBC Select Visa Card | 13.99% | 13.99% | 0% for 10 months (1% fee) | $29.00 (waived in the first year) |
| Category Best Low Interest Credit Card for Free Global Money Transfers | Credit Card CIBC Select Visa Card | Purchase Interest Rate (APR) 13.99% | Cash Advance Interest Rate (APR) 13.99% | Balance Transfer Interest Rate (APR) 0% for 10 months (1% fee) | Annual Fee $29.00 (waived in the first year) |
| Best Low Interest Credit Card for Insurance | Desjardins Odyssey Visa Infinite Privilege | 11.90% | 12.90% | N/A | $295 for Desjardins members, $395 for non-members |
| Category Best Low Interest Credit Card for Insurance | Credit Card Desjardins Odyssey Visa Infinite Privilege | Purchase Interest Rate (APR) 11.90% | Cash Advance Interest Rate (APR) 12.90% | Balance Transfer Interest Rate (APR) N/A | Annual Fee $295 for Desjardins members, $395 for non-members |
Best Low Interest Credit Cards in Canada
Based on our research, here are the best low interest credit cards available in Canada, each excelling in different categories:
Best for Low Purchase Interest Rates
MBNA True Line® Gold Mastercard®
Overview
Purchase Interest Rate: 10.99%
Cash Advance Interest Rate: 24.99%
Balance Transfer Interest Rate: 13.99%
Annual Fee: $39.00
Rewards and Perks
No fee for additional cardholders
Pros
Extremely low purchase interest rate at 10.99%
No annual fee
Cons:
High interest rates for cash advances and balance transfers
No additional perks or insurance
Borrowell's Take
With its outstandingly low purchase interest rate, the MBNA True Line® Gold Mastercard® is a perfect choice for those who frequently carry a balance on their purchases. However, it lacks additional perks and has high rates for cash advances and balance transfers, which might not suit everyone’s needs.
Visit the MBNA website to apply.
Best for Low Interest Cash Advances
TD Low Rate Visa Card
Overview
Purchase Interest Rate: 12.90%
Cash Advance Interest Rate: 12.90%
Balance Transfer Interest Rate: 12.90%
Annual Fee: $25.00
Rewards and Perks
Welcome Bonus: 8.99% promotional interest rate on purchases for the first 6 months
No fee for additional cardholders
Purchase security and extended warranty protection
Pros
Competitive interest rates for both purchases and cash advances
Promotional balance transfer rate
Cons
Annual fee of $25
Borrowell's Take
The TD Low Rate Visa Card offers a balanced package with competitive rates for purchases and cash advances, along with useful perks and protections. The annual fee is minimal considering the benefits, making it a solid choice for those needing low rates on cash advances.
Visit the TD website to apply.
Best for Low Interest Balance Transfers
MBNA True Line® Mastercard®
Overview
Purchase Interest Rate: 12.99%
Cash Advance Interest Rate: 24.99%
Balance Transfer Interest Rate: 0% for 12 months (3% fee)
Annual Fee: $0.00
Rewards and Perks
No fee for additional cardholders
0% interest on balance transfers for 12 months (3% fee)
Pros
No annual fee
Cons
Higher interest rates for purchases and cash advances
Borrowell's Take
The MBNA True Line® Mastercard® stands out for its excellent balance transfer offer, making it ideal for consolidating and paying off existing credit card debt. With no annual fee, it's a cost-effective option, though the higher purchase and cash advance rates should be considered.
Visit the MBNA website to apply.
Best Variable Rate Credit Card + Best Low Interest Credit Card with No Annual Fee
RBC RateAdvantage Visa
Overview
Purchase Interest Rate: Prime + 4.99% to 8.99%
Cash Advance Interest Rate: Prime + 4.99% to 8.99%
Balance Transfer Interest Rate: Not specified
Annual Fee: $0.00
Rewards and Perks
No fee for additional cardholders
Purchase security and extended warranty protection
Save $0.03/litre at Petro Canada
50 Be Well points for every $1 spent at Rexall
3-month complimentary DashPass subscription
Pros
No annual fee
Variable interest rate tied to prime rate
Useful perks and protections without extra cost
Cons:
Variable rates can fluctuate with the prime rate
Borrowell's Take
The RBC RateAdvantage Visa shines as the best variable rate credit card and the best low interest credit card with no annual fee. It offers the flexibility of a variable interest rate tied to the prime rate, which can be beneficial in a low interest rate environment. This card provides excellent value with no annual fee and a range of perks including purchase security, extended warranty protection, and discounts at Petro Canada and Rexall.
It’s a cost-effective choice for budget-conscious individuals looking to save on interest and take advantage of valuable benefits. However, it's essential to consider that the variable rates can change with the prime rate, which could impact your overall costs.
Visit the RBC website to apply.
Best Low Interest Cashback Card + Best Low Interest Credit Card for Insurance
Desjardins Odyssey Visa Infinite Privilege
Overview
Purchase Interest Rate: 11.90%
Cash Advance Interest Rate: 12.90%
Balance Transfer Interest Rate: Not specified
Annual Fee: $295 for Desjardins members, $395 for non-members
Rewards and Perks
Visa Infinite benefits
Comprehensive travel insurance
Up to 4% cashback rewards
Lounge access at Montreal-Trudeau International Airport
Pros
Low interest rates for purchases and cash advances
Extensive premium perks and travel insurance
Excellent cashback rewards program
Cons
High annual fee
Borrowell's Take
The Odyssey Visa Infinite Privilege card stands out as both the best low interest cashback card and the best low interest credit card for insurance. With low interest rates and a generous cashback rewards program, this card offers substantial value for those looking to maximize their rewards while keeping interest costs low.
The card's premium perks, including comprehensive travel insurance and airport lounge access, make it an excellent choice for frequent travellers. Despite the high annual fee, the extensive benefits and protections provided by this card justify the cost, making it a great option for those seeking robust insurance coverage and rewarding cashback opportunities.
Visit the Desjardins website to apply.
Best Low Interest Credit Card for Free Global Money Transfers
CIBC Select Visa Card
Overview
Purchase Interest Rate: 13.99%
Cash Advance Interest Rate: 13.99%
Balance Transfer Interest Rate: 0% for 10 months (1% fee)
Annual Fee: $29.00 (waived in the first year)
Rewards and Perks
Welcome Bonus: 0% interest on balance transfers for 10 months
Annual fee waived in the first year
$0 global money transfer fee
$0.10 off per litre at certain gas stations
$100k Common Carrier Accident Insurance
Pros
No global money transfer fee
Cons
Annual fee after the first year
Borrowell's Take
The CIBC Select Visa Card is a standout for those needing low cost international money transfers and balance transfers. The first-year annual fee waiver and additional perks make it an attractive option for those looking to save on global transactions.
Visit the CIBC website to apply.
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The Bottom Line
Low interest credit cards are essential for anyone looking to manage their finances more effectively. By offering reduced interest rates on purchases, balance transfers, and cash advances, these cards can significantly lower the cost of borrowing. This makes them ideal for individuals who carry a balance or need to make substantial purchases.
Our top picks highlight the best options available in Canada, each catering to specific needs such as low purchase interest rates, balance transfers, and additional perks like cashback and travel insurance.
When selecting a low-interest credit card, it's crucial to consider your financial habits and goals. Evaluate the card's features, including its APR, balance transfer options, annual fees, and any additional benefits. By choosing the right card, you can save money on interest charges and better manage your debt, ultimately helping you achieve financial stability and success.
Trusted by over 3 million Canadians, Borrowell provides free weekly credit scores and report monitoring, personalized financial product recommendations and affordable tools to help you build your credit. Sign up for your free Borrowell account today on borrowell.com, or download the mobile app for Android or iOS.
More Information
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FAQs
Most credit card issuers will let you apply for a card online, and you'll usually know whether or not you're approved within minutes. Here are the basic steps for applying for a credit card in Canada:
Have a thorough read of the card’s details to ensure it suits your needs and that you meet the eligibility requirements.
Fill out the application form. You'll typically be asked for details such as your full name, date of birth, employment details, home address and Social Insurance Number.
Review your application carefully to make sure all the information you've provided is accurate.
Submit your application to the card issuer.
Credit card interest is the cost of borrowing money from the credit card issuer. In Canada, credit card interest rates are typically expressed as an annual percentage rate (APR), representing the total cost of borrowing over a year.
Credit card issuers give a grace period to pay for your previous month’s purchases without interest. The grace period begins on the last day of your billing period. However, this grace period doesn’t apply to cash advances or balance transfers. On those transaction types, you'll start accruing interest right away.
If you don't pay off your balance in full before the end of the interest-free grace period, you'll start accruing interest.
Find out more about how credit card interest works in Canada on our blog.
While the average Canadian has between 1-2 credit cards, there’s no hard and fast rule for how many credit cards a person should have, and there are pros and cons to having several cards.
As long as you manage your credit cards responsibly and make your payments on time, there’s nothing wrong with having multiple credit cards. In fact, if you use credit strategically, holding multiple cards can help you capitalize on rewards programs, improve your credit to debt ratio, and offer a safety net for emergency purchases.
However, if you’re not thoughtful about which credit cards you apply for or how you use them, you may wind up paying excessive annual fees, and you could even harm your credit score if you don’t manage your accounts well.
Ultimately, it’s up to you to determine how many cards you can reasonably manage based on your income, spending habits, and goals.
Your credit score directly impacts the types of credit cards you can qualify for. Higher credit scores often mean better credit card perks, higher credit limits, and a greater selection of credit card lenders to choose from.
Generally, consumers with credit scores below 660 may find it harder to qualify for premium cards and may only qualify for a limited selection of general credit cards with lower credit limits. Consumers with credit scores higher than 660 are typically eligible for credit cards with increased limits and additional perks, such as travel points or high cashback rates.
Applying for a new credit card can affect your credit score. This is because a hard credit inquiry is usually required when you apply for a credit card. A hard credit inquiry is when a potential lender checks your credit report to help them decide whether to approve your application for a credit product. Any time a hard inquiry is performed, it can potentially lower your credit score by a few points. For this reason, it's a good idea not to apply for too many credit products at once.
That being said, if you manage your credit well by making your payments on time and keeping your credit utilization below 30%, your credit will likely recover quickly and even improve further over time.
Credit card churning is the process of opening cards purely to take advantage of the welcome bonus or other perks. Often, it involves closing the card after the bonus period and before the next annual fee is charged.
Credit card churning can have a negative effect on your credit score depending on how many credit cards you're applying for over what period of time. This is for a number of reasons. Firstly, whenever you apply for a credit product, the issuer will run a hard inquiry on your credit report, which can have a small negative effect. If you're applying for multiple credit cards at once, this negative effect can add up.
Secondly, credit card churning typically involves closing credit cards at the end of the bonus period, and closing credit cards can affect your credit score negatively as it "wipes out" the good credit you build up with that card, like the credit history and payment history. It will also increase your credit utilization by reducing the amount of credit you have available, which in turn increases the proportion on credit that you're using.
Cards were ranked based on the following criteria:
Interest Rates:
We evaluated the rates for purchases, cash advances, and balance transfers to determine the card's overall affordability.
Annual Fees:
The cost of the annual fee, including whether it is waived in the first year, was considered to assess the card's cost-effectiveness.
Balance Transfer Offers:
Promotional balance transfer rates and terms were examined to identify the best options for consolidating and paying off debt.
Additional Perks:
Rewards programs, cashback offers, travel insurance, purchase protection, and other cardholder benefits were taken into account to measure added value.
We evaluated each card's overall value by considering its ability to save money on interest charges and provide useful benefits to the cardholder. Cards that offered low interest rates, reasonable fees, and attractive perks were ranked higher, as they help users manage debt more effectively and enjoy additional financial benefits.
The views expressed in this post are based on Borrowell’s opinions and we did not accept sponsorships or compensation in exchange for placement on this list. While we may receive a referral fee if a Borrowell member signs up for one of the products recommended on this page, this didn’t influence the ranking. We are committed to empowering Canadians with the impartial information they need to make great financial decisions.
The information for the cards in this list has been collected independently by Borrowell. The card details have not been reviewed or provided by the card issuers.
The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone, not those of the companies mentioned, and have not been reviewed, approved or otherwise endorsed by any of these entities.