Best Credit Cards

Best Credit Cards In Canada For Bad Credit In 2019

| Last updated on September 4, 2019
best credit cards in canada for bad credit

Poor credit score and bad credit – these two scars in a person’s financial history can halt their future growth. The good news is that these states aren’t set in stone. There are credit cards in Canada that are specifically designed for cardholders with bad or no credit histories. Most of these cards aren’t brimming with rich perks and amazing rewards, but they are a foolproof way to (re)start your journey into a better financial future, and to qualify for a premium credit card that’s loaded with features and benefits that you are looking for.

The best type of cards to repair or build your credit are secured credit cards. For these, you have to place a security deposit which protects the lender if you fail to make your payments. When you close your account you will get your deposit back, as long as you don’t have any outstanding balance. Because there’s minimal risk associated with this card for the issuer, almost anybody can qualify. That said, there are a few unsecured card options available too.

In this article, we will look at the top credit cards in Canada best suited for people with bad or no credit. We have included both secured card and unsecured card options for you.

Summary:
Best Overall Credit Card for Bad Credit: BMO Preferred Rate Mastercard
Best Unsecured Card With No Fee: No-Fee Scotiabank Value Visa
Best Secured Card With No Fee: Home Trust Secured Visa (No Annual Fee Option)
Best Secured Card With Low-Interest: Home Trust Secured Visa (Low Interest Option)
Best Unsecured Card With Low-Interest: RBC Visa Classic Low Rate Card
Best For Guaranteed Approval: Capital One Guaranteed Secured Mastercard
Best For Balance Transfers: MBNA True Line Mastercard Credit Card

Best Overall Credit Card For Bad Credit

BMO Preferred Rate Mastercard

bmo preferred rate card

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on BMO’s website

Annual Fee
$20

Interest Rate
Purchases: 12.99%
Balance transfers and access cheques: 12.99%
Cash advances: 12.99%

Min. Income Required
$15000 minimum personal income required

Our absolute favorite option for those with no or poor credit score is the BMO Preferred Rate Mastercard. If you’re looking to build or rebuild your credit score, lower your credit card debt, or just looking for a credit card with low interest-rate, then you should definitely consider getting BMO Preferred Rate Mastercard. It gives you a solid way to repair your credit history, tackle debt, while giving you an option to purchase insurance.

For just $20 annual fee, you can get a flat interest-rate of 12.99% for Purchases and Cash Advances. As a welcome offer, this credit card gives you a 3.99% introductory balance transfer for nine months with a 1% transfer fee. After the promotional period, the balance transfer rate increases to 12.99%.

There are two types of insurance coverages available with this card. There’s Extended Warranty coverage that doubles your original manufacturer’s warranty up to a maximum of one additional year, and Purchase Protection insurance that secures your new purchases made using your card against theft or damage for 90 days. For an extra-fee, you can make your BMO Preferred Rate Mastercard more robust by adding features such as Credit Alert, BMO Roadside Assistance, Info Protector 360, and BMO Credit Card Balance Protection.

Click here for more details about the BMO Preferred Rate Mastercard

Best Unsecured No Fee Credit Card for Bad Credit

No-Fee Scotiabank Value Visa

scotiabank no fee value visa

Apply Now

on Scotiabank’s website

Annual Fee
$0

Interest Rate
Purchase: 16.99%;
Cash Advance: 16.99%

Minimum Income Required
$12,000

With no annual-fee and relatively low interest rate, the No-Fee Scotiabank Value is a fantastic option for people seeking to build and rebuild credit.

This card comes with an unbeatable balance transfer rate of 3.99% for the first 6 months. So, if you have a balance on a high interest credit card, then you can shift that amount to your new no-fee Scotiabank value visa credit card for a very low rate. This will help you grab significant savings on interest.

This card has a minimum credit limit of $500. It isn’t a secured card, and as such you do not have to make any security deposit to qualify. To keep your credit improving, it’s recommended to pay your balance in full, but if that’s not possible, at least meet your minimum payment obligations.

As a No-fee ScotiaBank Value Visa cardholder, you will also receive up to 25% off when booking rentals at AVIS locations and at participating budget locations in Canada and throughout the US.

There’s also optional insurance available that you can have as an add-on for a monthly rate of $1.09 per $100 of the daily balance on your credit card account.

Click here for more details about the No-Fee Scotiabank Value Visa

Best Secured Credit Card With No Annual Fees

Home Trust Secured Visa (No Annual Fee Option)

home trust secured visa

Apply Now

on Home Trust’s website

Annual Fee
$0

Interest Rate
19.99%

Minimum Income Required
N/A

A Home Trust Secured Visa is a type of secured credit card aimed towards Canadians who are looking to establish or reestablish their credit score. This card has no annual-fee so you can use your saved funds towards reducing your debt and making that security deposit.

The credit limit on this card is flexible, and can be anywhere from $500 to $10,000–depending on what amount you place as your deposit. Your limit scales with your deposit on a 1-to-1 ratio. The Home Trust Secured Visa (No-Fee) comes with a 21-day no-interest grace period, which is a window of time in which you can pay your balance without accruing interest.

Your minimum monthly payment will not be painfully high. It will be either $10 or 3% of the current balance amount on your card, whichever is higher. Also, since its a Visa Card, you can be rest assured that they will be accepted in almost all the shops and ATMs in and outside of Canada. When you decide to cancel your credit card, just pay off your remaining balance and you’ll receive your security deposit back.

Click here for more details about the Home Trust Secured Visa

Best Low-Interest Secured Card

Home Trust Secured Visa (Low-Rate Option)

home trust secured visa

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on Home Trust’s website

Annual Fee
$59, or $5 per month

Interest Rate
14.90%

Minimum Income Required
$0

The Home Trust Secured Visa is very similar to its secured no-fee Visa alternative, except this one does have an annual fee, but comes with lower interest rate on purchases. When it comes to purchase rate, if you pay your balance in full every month, you don’t have to pay interest. But if you only pay the minimum balance, you will have to pay the purchase interest of 14.90%. That’s a full 5% lower than the no-fee option.

There is an annual fee of $59 associated with this credit card but if that’s too high, you can resort to paying a monthly fee of $5. You can start using this credit card by placing as little as $500 as security deposit. Your credit limit will be the same as your deposit and can be a maximum of $10,000. As you increase your deposit, your limit will increase too.

If you consistently pay your balance in full every month, Home Trust will send a monthly report to TransUnion and Equifax, and your credit will undergo significant improvement overtime. Since this is a Visa card, it comes with a free 90 days of Purchase Protection that covers items purchased using this credit card against theft, loss and damage. Almost anyone is eligible for this card, even if you have had past bankruptcies or no credit.

Click here for more details about the Home Trust Secured Visa

Best Unsecured Low-Interest Card for Bad Credit

RBC Visa Classic Low Rate Card

rbc visa classic low rate

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on RBC’s website

Annual Fee
$20

Interest Rate
Purchasez: 11.99%
Cash Advances: 11.99%

Minimum Income Required
$0

If you want to rebuild your credit without sacrificing the perks that are associated with unsecured cards consider getting your hands on the RBC Visa Classic Low Rate Card. It has an annual fee of $20 and a flat Interest rate of 11.99% on both purchases and cash advances. This amount will be increasing to 12.99% starting November 1, 2019. But even so, this annual interest-rate is still significantly lower the alternatives.

If you are someone who carries a balance from month to month then picking a card with low interest-rate is very important because you won’t have to lose your savings paying interest.

The RBC Visa Classic Low Rate Card also comes with Purchase Security and Extended Warranty insurance. You will also save 3 cents/litre on fuel if you pay for gas with your credit card. Along with that, you will earn 20% more Petro Points when fueling up at Petro Canada. To make this card more comprehensive, you can add on features such as RBC Road Assist, Travel Insurance, Credit and Identity Protection, Identity Theft Protection and Balance Protection Insurance for an additional fee.

While your eligibility isn’t guaranteed, this credit card doesn’t have a specific minimum credit score for all applicants. RBC looks more at the applicant’s overall credit history, savings, and debt to income ratio while assessing their case. The basic qualification requirements to apply for this credit card is to be a permanent resident of Canada, and have no current bankruptcies.

Click here for more details about the RBC Visa Classic Low Rate Card

Best For Guaranteed Approval

Capital One Guaranteed Secured Mastercard

capital one guaranteed secured mastercard

Apply Now

on Capital One’s website

Annual Fee
$59

Interest Rate:
19.80%

Minimum Income Required
$0

For an annual fee of $59, you can get your hands on the Capital One Guaranteed Secured Mastercard, which is a credit card that approves anyone in need of rebuilding credit and improving scores. Depending on the security deposit you place, your credit limit can be anywhere from $300-$2,500.

Your qualification is guaranteed as long as you are at least the age of majority in your residential province, haven’t applied for a Capital One account more than one time in the last 30 days, don’t have a Capital One account that was not in good standing in the last year, and don’t have an existing Capital One Account or a pending application for one. Lastly, you must be able to place the necessary security funds of $75 or $300. The Standard Interest rate for purchases, balance transfers, and cash advances is 19.8% flat.

Capital One will report your credit card activity to credit bureaus on a monthly basis. If you consistently pay your full balance, your credit will improve over time.

Because this is a Mastercard, it comes with two inbuilt features- Master Global Service which provide you emergency card replacement, emergency cash advance, 24/7 telephone access and referral to the closest ABM; Zero Liability feature which protects you against unauthorized charges on your credit card.

Click here for more details about the Capital One Guaranteed Secured Mastercard

Best For Balance Transfers

MBNA True Line Mastercard Credit Card

mbna true line mastercard

Apply Now

on MBNA’s website

Annual Fee
$0

Interest Rate
12.99%

Minimum Income Required
$0

The MBNA True Line Mastercard is currently offering the best balance transfer promotion in Canada right now. With this card you can get a 0% balance transfer for a total of 10 whole months. This rate will apply to any Balance transfers made within 90 days from the date your account is opened. After this period, your Balance Transfer rate will increase to 12.99%. The purchase interest-rate is also 12.99% while the Cash Advance rate is 24.99%.

There’s No-Balance Transfer fee is a fantastic opportunity for cardholders to consolidate debts spread across multiple cards to one card, so you can save on interest while paying off your debt faster. There’s one caveat though– the total value of Balance Transfers cannot exceed your authorized credit limit.

Also, you can add up to 9 authorized users with no additional annual fee requirement. MBNA True Line Mastercard comes with emergency services including emergency card replacement services. The Away from Home feature on this card that includes Trip Assurance which provides support for lost document and ticket replacement, lost luggage assistance, and pre-trip information and legal assistance.

Click here for more details about the MBNA True Line Mastercard


Methodology: How We Choose The Cards In This List

The credit cards mentioned this list have been thoroughly vetted on several factors such as interest rates, annual fee, eligibility requirements, security deposits, and other factors that are important to have in a good credit card for people with bad and no credit history in Canada.