No Fee Credit Card in Canada: See Which One to Choose

Having a no fee credit card in Canada is a great way to enjoy all the benefits of credit without worrying about paying annual fees.

No annual fee cards offer a practical and economical way to make your purchases without the concern of additional charges that are common with credit cards that have annual fees.

Stay with us to understand how these cards work, explore their advantages, and be aware of their disadvantages. Also, check out some of the best options available in the country.

What is a no fee credit card?

A no fee credit card is a type of card that doesn’t charge an annual fee to keep the account active.

Many traditional credit cards in Canada charge this fee, which can range from CAD$50 to CAD$150, depending on the benefits offered.

With the no fee credit card, this charge is eliminated, meaning the cardholder doesn’t have to worry about a fixed expense throughout the year, keeping the card for free.

Upon careful consideration, this is a great advantage, especially for those looking to control their spending or who are starting to build a credit history and want to minimize the costs associated with using a credit card.

Additionally, it’s important to check if the card offers other benefits, such as rewards programs or purchase protection, and to see what other fees are involved.

Can a no fee credit card have other fees?

Even though a no fee credit card doesn’t have the annual payment fee, it can still charge other types of fees to customers.

These fees vary depending on the financial institution, the type of card, and the agreement made when applying for credit. We’ve listed some of the most common fees that may apply:

• Interest on outstanding balance: If you don’t pay your card bill in full by the due date, you’ll be charged interest on the remaining balance. Interest rates in Canada range from 19.99% to 22.99% annually.
• Cash advance fees: When you use your card to withdraw money from an ATM, there’s an additional fee, and interest starts accruing immediately, with no grace period.
• Currency conversion fees: For international purchases, card issuers charge a currency conversion fee, which can be around 2.5% to 3% of the transaction value.
• Late payment fees: If you miss your payment, a fixed penalty is applied. This penalty can vary but is generally around CAD$29 to CAD$39 for a late payment.

So, even without the annual fee, it’s crucial to read the contract carefully and understand all the fees associated with the card. This helps you avoid surprises and manage your credit more effectively.

Are there no annual fee cards with rewards?

Yes, they exist! Many no annual fee credit cards offer attractive rewards programs.
These programs can include cashback, travel points, discounts on specific purchases, among other benefits.

The most interesting part is that, with a no fee credit card, you can enjoy these rewards without having to pay for the annual card maintenance.

Therefore, it’s worth paying attention to the redemption conditions and the value of the rewards, as they can vary greatly among different issuers.

Some common ways rewards are offered by no annual fee cards include:

• Cashback: The cardholder receives a percentage of purchases back in cash. Some cards offer cashback on all purchases, while others give higher percentages for specific categories like groceries or gas.
• Points: Some cards allow users to accumulate points that can later be redeemed for travel, products, or statement credits.
• Specific rewards: Cards may offer advantages at partner stores or services, such as discounts on travel and accommodations.

Now, let’s understand some of the top no annual fee credit card options available in Canada and their respective benefits.

No Annual Fee Credit Card Options in Canada

In Canada, there are several no annual fee credit card options that offer different types of benefits and rewards programs.

We’ve listed some of the most popular ones and their main features for you to review carefully and decide which one suits you best! Check it out:

1. Tangerine World Mastercard

The Tangerine World Mastercard is one of the most popular cards in Canada because it offers a very flexible cashback program.

Cardholders can choose up to three purchase categories where they receive 2% cashback. On all other purchases, the cashback is 0.5%.

• Benefits: Up to 2% cashback in selected categories, no limit on how much you can earn, access to car rental insurance and purchase protection.
• Disadvantages: 2.5% currency conversion fee on international purchases.
• Interest rate: 19.95% on purchases and cash advances.

2. BMO Air Miles Mastercard

The BMO Air Miles Mastercard is a perfect option for those who like to accumulate travel miles without having to pay an annual fee. Is this your case?

This card allows holders to earn Air Miles on their everyday purchases, which can be redeemed for travel, products, and specific events.

• Benefits: Earn 1 Air Mile for every CAD$20 spent, welcome bonus (500 Air Miles), up to 25% off flights when points are redeemed.
• Disadvantages: Rewards are limited to the Air Miles program, which may not appeal to everyone.
• Interest rate: 19.99% on purchases and cash advances.

3. CIBC Aventura Visa Card

The CIBC Aventura Visa Card offers travel rewards and is a good choice for those looking to accumulate points for flights and accommodations.

• Benefits: Earn 1 Aventura point for every CAD$1 spent on CIBC travel and 1 point for every CAD$2 on other purchases.
• Disadvantages: The rewards program is more complex and requires planning to maximize benefits.
• Interest rate: 19.99% on purchases and cash advances.

4. Home Trust No Fee Preferred Visa

The Home Trust No Fee Preferred Visa is a great choice for those who make purchases abroad, as it offers the rare advantage of no currency conversion fee, along with cashback on all purchases.

• Benefits: 1% cashback on all purchases, no currency conversion fee.
• Disadvantages: No specialized rewards program, no welcome bonuses or cashback categories.
• Interest rate: 19.99% on purchases and 24.99% on cash advances.

5. BMO Cash Back Mastercard

The BMO Cash Back Mastercard is an excellent choice for those seeking a return in the form of cash on everyday purchases.

This card provides up to 5% cashback on grocery purchases in the first year.

• Benefits: 5% cashback on groceries during the first 3 months, 3% on gas, 1% on utility bills, and 0.5% on all other purchases.
• Disadvantages: Higher cashback categories have monthly limits that restrict earnings.
• Interest rate: 19.99% on purchases and cash advances.

Choosing the best no annual fee credit card in Canada depends entirely on your financial needs and spending habits.

For those looking to maximize travel rewards, the BMO Air Miles Mastercard or the CIBC Aventura Visa Card are the best options.

For those who prefer cash rewards, the Tangerine World Mastercard or the BMO Cash Back Mastercard offer better returns on specific purchases.

Regardless of the card chosen, it’s always recommended to review all associated fees and ensure the selected card offers the best benefits according to your lifestyle.

This way, you can enjoy the advantages of a no fee credit card without compromising your budget or getting into debt.

Have you decided which card best suits your spending profile? Take advantage of our list and analyze thoroughly before signing up or applying for any of them!

Also, read about the main fees applied to credit cards and how they work.