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No matter what type of credit card or other loan or credit product you take out, one of the first factors you should consider is the interest rate. 

Credit cards are notorious for charging exorbitant interest rates, which can really eat into your savings if you have a tendency to make partial payments and carry over large balances from month to month. 

The good news is that there are a handful of credit cards available to Canadians that charge far lower interest rates than what you may be used to. If you use credit cards for large purchases for which you don’t have the cash on hand, a low-interest credit card might be better than a personal loan or line of credit. 

We’ve looked at all the low-interest credit card options in Canada and compared them to find the lowest interest rates available. Some have no annual fee, while others offer welcome bonuses that make it difficult to turn them down. 

In this article, we’ve rounded up some of the best low-interest credit cards available to help you avoid racking up sky-high interest charges month after month. 

Criteria Used To Evaluate Low-Interest Credit Cards

To come up with our favourite low-interest credit cards, we looked at the following criteria to break down our analysis: 

  • Fees 
  • Interest rate
  • Welcome bonus
  • Perks

Overview Of The Best Low-Interest Credit Cards

The following is a list of the best low-interest credit cards in Canada, along with their respective interest rates and annual fees:

Annual FeeInterest rateCash Advance interest rate
MBNA True Line Gold Mastercard$398.99%24.99%
TD Emerald Flex Rate Visa$25TD Prime + 4.50% to 12.75%TD Prime + 4.50% to 12.75%
HSBC +Rewards Mastercard$2511.9%11.9%
BMO Preferred Rate MasterCard$2012.99%12.99%
MBNA True Line Mastercard$012.99%24.99%
CIBC Select Visa$2913.99%13.99%
MBNA True Line Mastercard

MBNA True Line Gold Mastercard 

One of the lowest interest rates you’ll ever see on a credit card comes from the MBNA True Line Gold Mastercard credit card. At a low 8.99% APR on purchases and balance transfers, you’d be hard-pressed to find a rate lower than that elsewhere. 

To take full advantage of this low rate, you can transfer any debts to your MBNA True Line Gold Mastercard, including any other credit card balances, loans, lines of credit, and so on. Depending on the rates you’re paying on other loan balances, you could save hundreds or even thousands of dollars by transferring those balances to your new MBNA True Line Gold Mastercard.

This card comes with an annual fee of $39, though the low-interest rate and the savings that come with it easily justify this small charge. 

Tap your card at any payment processor that accepts Mastercard, or use the handy Apple Pay for a quick and convenient way to pay for purchases. You can also add up to 9 authorized users without having to pay any additional annual fees for each user. 

You’ll benefit from Mastercard Zero Liability, which will protect you against any unauthorized purchases made with your credit card. And take advantage of extended warranty benefits with your new MBNA card, which doubles manufacturer warranties for up to one year on most new items purchased. 

You can also save at least 10% on your next car rental at Avis Rent-A-Car or Budget Rent-A-Car when reserving your rental with the MBNA True Line Gold Mastercard.

  • Annual Fee: $39
  • Purchase interest rate: 8.99%
  • Balance transfer interest rate: 8.99%
  • Cash advance interest rate: 24.99%
  • Credit score required: Fair to good
  • Minimum income required: None
TD Emerald Flex Rate Visa

TD Emerald Flex Rate Visa 

Whether you’re looking for a convenient credit card for everyday purchases or want a low-rate option to transfer over all your higher-rate balances to save money, the TD Emerald Flex Rate Visa is a great option. With this card, you can take advantage of a low variable interest rate of TD’s prime rate + 4.50% to 12.75%, depending on your credit score. And that applies to both purchases and cash advances.

As of this writing, TD’s prime rate stands at 2.450%. So, that means you could be paying a rate as low as 6.95% if your credit rating is high. If you have a tendency to carry a balance from month to month, paying a lower rate can really help.

There are other perks that come with the TD Emerald Flex Rate Visa, like travel, medical, interruption, and cancellation insurance. Plus, you can use your card in conjunction with Apple Pay that allows you to use your smartphone to make a payment rather than having to reach for your card. 

The annual fee is also comparatively low at $25 per year, with additional authorized users paying $0. Plus, you’ll have peace of mind knowing that you can shop securely online and in-person thanks to Visa Zero Liability which protects you against unauthorized transactions made with your credit card. And you’ll be automatically alerted via your mobile phone whenever any suspicious activity on your TD Emerald Flex Rate Visa card occurs. 

  • Annual Fee: $25
  • Purchase interest rate: TD Prime + 4.50% to 12.75%
  • Cash advance interest rate: TD Prime + 4.50% to 12.75%
  • Credit score required: Fair to excellent
  • Minimum income required: None
HSBC +Rewards Mastercard

HSBC +Rewards Mastercard

The HSBC +Rewards Mastercard offers the best of both worlds in terms of low-interest rates and rewards, which is a true rarity. With the low-interest rate of 11.9% on purchases, balance transfers, and cash advances, you won’t be stuck overpaying for the interest portion, particularly if you tend to carry a balance from month to month. 

With every purchase you make using this card, you earn points that can be used to redeem rewards on travel, merchandise, and gift cards. More specifically, you can earn 2 points for every $1 spent at eligible restaurants and entertainment venues, and 1 point for every $1 spent on all other purchases.

Getting approved for the low-rate HSBC +Rewards Mastercard is easy too, as no minimum income is required. Plus, the annual fee is quite low at $25. You’ll also have the chance to earn 20,000 points as a new cardholder (a value of $100 in travel) and the annual fee is waived for the first year. The deadline for this welcome offer is December 28, 2020. 

Your purchases will be protected with insurance coverage and price protection services so that no unauthorized purchases with your card will go through. And shopping is even more convenient thanks to the Apple Pay feature that lets you use your smartphone for purchases. 

  • Annual Fee: $25
  • Purchase interest rate: 11.9%
  • Cash advance interest rate: 11.9%
  • Credit score required: Not specified
  • Minimum income required: None
BMO Preferred Rate MasterCard

BMO Preferred Rate MasterCard

The interest rate on the BMO Preferred Rate MasterCard is already low enough at 12.99% for purchases, balance transfers, and cash advances — but the introductory rate is unparalleled. For the first 9 months, you can take advantage of an incredibly low rate of just 3.99% on balance transfers with a 1% transfer fee. Plus, the annual fee of $20 will be waived for the first year. 

The BMO Preferred Rate MasterCard makes sense for those who are looking to consolidate their debt into one manageable, low-rate debt. It’s also great if you have a tough time making full payments each month and carry balances over to subsequent billing periods. 

You’ll have full protection with the BMO Preferred Rate Mastercard, including extended warranty coverage on new items, which doubles the manufacturer’s warranty period for up to one year. You’ll also have Zero Dollar Liability to protect you against purchases made on your card without your consent. 

  • Annual Fee: $20
  • Purchase interest rate: 12.99% (3.99% during introductory period)
  • Cash advance interest rate: 12.99%
  • Credit score required: Fair to good
  • Minimum income required: $15,000/year
MBNA True Line Mastercard

MBNA True Line Mastercard

Like the MBNA True Line Gold Mastercard, the MBNA True Line Mastercard also comes with a low-interest rate of 12.99% for purchases and balance transfers. However, the rate goes up to 24.99% for cash advances. 

Unlike the Gold card, however, the basic True Line Mastercard comes with no annual fee in exchange for the slightly higher rate. That said, 12.99% is still roughly half of what you’d pay for your average reward-based credit card.  

With such a low rate, the MBNA True Line Mastercard makes a great option for those looking to keep their interest down on all their loans. As such, transferring higher-rate balances over to the True Line card can help you save quite a bit on your debt load. 

There is no annual income requirement, making this card more accessible than many other similar credit cards. You can add up to 9 authorized users without a fee and use Apple Pay on your smartphone in conjunction with your MBNA card for more convenient point-of-sale purchases. 

Any unauthorized purchases will be flagged and reversed thanks to the Mastercard Zero Liability protection program. You can also save at least 10% on your next car rental at any Avis Rent-A-Car or Budget Rent-A-Car locations. 

  • Annual Fee: $0
  • Purchase interest rate: 12.99% 
  • Balance transfer interest rate: 12.99%
  • Cash advance interest rate: 24.99%
  • Credit score required: Fair to good
  • Minimum income required: None
CIBC Select Visa

CIBC Select Visa 

One of the best introductory offers we’ve seen comes from the CIBC Select Visa, which currently offers 0% interest on balance transfers over the first 10 months with only a 1% transfer fee. That should give you plenty of time to catch up on your outstanding payments while moving your balances over to your new CIBC credit card (up to 50% of your credit limit). Plus, the $29 annual fee will be waived for the first year. 

Following the introductory 0% rate period, the rate will increase to 13.99% for purchases and cash advances, though still a very competitive rate compared to other cards. If you have a lot of high-interest debt on cards, the CIBC Select Visa card may be a great option to consolidate your debt. 

The card also comes with $100,000 in travel accident coverage with Common Carrier Accident Insurance, along with CIBC Emergency Travel Medical and CIBC Payment Protector Insurance for added protection. 

  • Annual Fee: $29
  • Purchase interest rate: 13.99% (0% during introductory period)
  • Cash advance interest rate: 13.99%
  • Credit score required: Fair to good
  • Minimum income required: $15,000

Why Apply For A Low-Interest Credit Card?

If you’re able to fully pay off your credit card purchase balance before the due date each month, you shouldn’t have to worry about high-interest rates. But if you have a habit of having a balance, a high rate can make it very difficult to pay down what you owe. 

Plus, you may even find the balance getting higher and higher every month as much of your payments go towards paying down the interest portion rather than the principal.

In this case, having a credit card that has a low-interest rate can be a real life-saver. You could save a pretty penny depending on your balances with a lower rate, especially if you consolidate all other credit card debt and transfer your other balances over to a low-interest credit card. 

Just keep in mind that some low-rate cards may charge a higher rate for cash advances. Plus, these cards typically don’t come with an option to earn points, with the exception of one or two low-interest cards. 

How To Get The Most Value From A Low-Interest Credit Card

The best way to get the most value of your low-interest credit card is to move other higher-rate balances over to consolidate your debt. Not only will you have just one bill to manage every month instead of many, but you’ll be charged a much lower rate on your outstanding balance, helping you save.

And as always, it’s wise to try your best to pay your credit card balances in full so that you won’t be stuck paying any interest on balances that will have to be carried over to the following billing period. 

Final Thoughts

Low-interest credit cards not only offer much lower rates than your average rewards credit card, but they often come with low annual fees too. Further, these cards are relatively easy to qualify for, often requiring no minimum income to be eligible. By using your low-interest credit card wisely, you can save a lot of money that otherwise would have been spent on the interest portion of your credit card balances.

Lisa Rennie avatar on Loans Canada
Lisa Rennie

Lisa has been working as a personal finance writer for more than a decade, creating unique content that helps to educate Canadian consumers in the realms of real estate, mortgages, investing and financial health. For years, she held her real estate license in Toronto, Ontario before giving it up to pursue writing within this realm and related niches. Lisa is very serious about smart money management and helping others do the same.

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