Canada’s best balance transfer credit cards 2020

• Annual fee: $20, refunded in the first year
• Balance transfer offer: 3.99% introductory interest rate on balance transfers in the first 9 months; 1% transfer fee
• Interest rate: 12.99% for purchases and cash advances
• Additional benefits: Extended warranty and purchase protection; discounts on Cirque du Soleil admission

Get more details about the BMO Preferred Rate*

Honourable mention

PC Financial World Elite Mastercard*

This card from PC Financial is best known for its PC Points-earning potential at stores owned by Loblaws. You get 45 Points per dollar at Shoppers Drug Mart; 30 points per dollar at PC Stores including Loblaws, No Frills, Real Canadian Superstore and PC Travel; and 10 Points everywhere else. However, this card may also be beneficial if you’d like to transfer your balance from another card. The PC Financial World Elite has a promotional offer of 0.97% interest for the first 6 months. After the promotion ends, however, it will climb up to 22.97%, so be sure you can pay off your transferred balance within that time frame before you sign up. This balance transfer offer is available on all three PC Financial Mastercards.

• Annual fee: None
• Balance transfer rate offer: 0.97% for the first 6 months; after that, the balance transfer rate increases to 22.97%
• Interest rate: 20.97% on purchases, and 22.97% on cash advances
• Additional benefits: Travel insurance that covers you if you are under the age of 65 and travelling for 10 days or less; Earn 45 PC Points per dollar at Shoppers Drug Mart, 30 Points per dollar at PC-affiliated stores and PC Travel and 10 points everywhere else

Get more details about the PC Financial World Elite*

Honourable mention

BMO Air Miles Mastercard*

Even though this card has no annual fee, it comes with perks that may benefit you if you don’t think you’ll be carrying a debt for long. In addition to the introductory offer of 1.99% interest on balance transfers for the first 9 months, you can collect Air Miles at an accelerated rate on your new purchases; you’ll get 2x the Miles when you shop at Air Miles partners, and 1 Mile per $20 spent everywhere else. New cardholders receive 800 bonus Air Miles, too.

This card comes with an extended warranty and purchase protection, and a discount on Cirque du Soleil shows. However, if you don’t pay off your balance within the first nine months, your interest rate will go up to 22.99%, which is a typical interest rate for most credit cards and may accumulate quickly if you still have a lot of debt to pay off. 

• Annual fee: None
• Balance transfer rate offer: 1.99% interest rate on balance transfers for 9 months; 1% fee applies 
• Interest rate: 19.99% on purchases; 22.99% on cash advances 
• Additional benefits: 2x the Miles for every $20 spent at Air Miles partners; 1 Mile for every $20 spent everywhere else; extended warranty and purchase protection; Cirque du Soleil discount

Get more details about the BMO Air Miles Mastercard*

What is a balance transfer?

A balance transfer is the transfer of debt from one credit card to another. Although a cardholder can transfer their debt for any variety of reasons, the goal is usually to move the debt to a lower interest-rate card, to cut down on the amount of interest charged and pay off the loan faster.

As most everyday-use credit cards command an interest rate of around 20%, your principal debt load can bloat quickly. By transferring debt to a card with a lower interest rate, you’ll incur lower interest charges—so more of your money goes to the principal balance.

Important things to know about balance transfer credit cards

Balance transfers can be an effective strategy for consolidating and addressing debt. But before you jump in, there are four main variables you need to understand.

• Shop around for the rate, timing and terms that suit you
  If you’re considering a balance transfer to eliminate debt, your best bet might be a balance transfer credit card. These cards come with promotions that let cardholders pay very low interest (as little as 0%) for a limited amount of time (like 6 or 10 months). These offers can be a really effective way to bring down your debt, fast, if you are disciplined about making regular payments, and not racking up a lot of new purchases. The card you choose will depend largely on what is available at the time you’re looking, how long you think you need to pay off your debt, and the card’s other terms.
• Remember that balance transfer promotions don’t last forever
  The low, single-digit rates available on balance transfer credit cards are limited-time offers, and once the promotional period is over, the cards’ regular interest rates will kick in. How you handle this will depend on the amount of your debt and how quickly you think you can pay it off, but in general the best strategy is to pay off your balance before the balance transfer offer ends, and to pick a card with a low regular interest rate. This way, you’re saving money even if you still owe after the offer period.
• Balance transfer fees
  Some—but not all—cards charge a fee on balance transfers. This fee is expressed as a percentage of the total amount you want to move, and is usually between 1% and 3%. So, for example, if you’re looking to transfer $1,000 in debt to a card with a 3% fee, your opening balance will be $1,030. This additional cost may well be worth the money you’ll save at the new lower interest rate, but keep your eyes open: Occasionally, a card will run a promotion where they waive the balance transfer fee.
• Separate your expenses
  It can be tempting to consolidate all your expenses in one place, but beware: If you charge a new purchase to your balance transfer card, this spend will be charged at the card’s regular interest rate, not the promotional rate. This might not seem like a big deal, especially if you’ve been lucky enough to find a card with a lower regular rate, but there’s an additional catch. Most credit cards apply payments to debt marked at the low or promotional rate first, which means your high-interest purchases are sitting there longer, racking up interest. If you’re trying to pay down debt, this only compounds the problem. It’s good practice to leave your balance transfer card at home and use a different financial product (like debit, cash or even a different credit card) for new purchases.

Overview: Canada’s best balance transfer credit cards

*Terms may vary by cardholder. Check with the provider for details.

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Our methodology

For the best balance transfer credit cards 2020 ranking, we categorized credit cards based on their limited-time balance transfer rates. Our rankings also took into account fixed annual interest rates on balance transfers and purchases, purchase protections and annual fees.

‡MoneySense.ca and Ratehub.ca are both owned by parent company Ratehub Inc. We may be partnered with some financial institutions, but this does not influence the “Canada’s Best Credit Card” rankings. You can read more about this in our Editorial Code of Conduct.