Canada’s best balance transfer credit cards 2022

The best balance transfer credit cards in Canada 2022

CIBC Select Visa Card*

The CIBC Select Visa easily wins the title of best balance transfer credit card in Canada for its unbeatable promotional offer: New cardholders enjoy 0% interest rate for balance transfers for 10 months. This can be a great tool to consolidate and pay off debts with no interest. What about after the 10-month promotional period ends? This card’s regular interest rate of 13.9% kicks in, which is lower than the average credit card (19%). So if you’re still paying off what you transferred, you can benefit from a lower interest rate. The $29 annual fee is rebated for the first year for you and three authorized users. Note: There is a 1% balance transfer fee (for example: $10 on a $1,000 balance). It’s a flat-rate, one-time fee.

The offer is available exclusively to new cardholders when applying online, and you can only transfer up to 50% of your assigned credit limit.

• Annual fee: $29 (rebated for the first year)
• Balance transfer offer: Get 0% interest for up to 10 months with a 1% transfer fee. For the first year, you'll also get an annual fee rebate for you and up to three authorized users
• Interest rate: 13.99% on purchases and cash advances

Get more details about the CIBC Select Visa Card *

Scotiabank Value Visa

When you sign up for Scotiabank’s Value Visa by February 28, 2022, you get a super-low interest rate of 0.99% on balance transfers for the first six months, which could save you a lot of money if you’re transferring from a high-interest card. After the introductory period is over, your interest rate will increase to 12.99%, which is still lower than most cards. Plus, you can use your card to get car rental discounts at Avis. While the card does have an annual fee, it’s a modest $29. Plus, there’s no balance transfer fee to pay.

• Annual fee: $29
• Balance transfer offer: Get 0.99% interest on balance transfers for the first 6 months. Apply by February 28, 2022.
• Interest rate: 12.99% on purchases and cash advances
• Additional benefits: Get a 25% discount on rental cars at participating Avis Rent A Car locations

BMO Preferred Rate Mastercard*

This Mastercard comes with a low annual fee (which is refunded in the first year) and an appealing balance transfer welcome offer. The interest rate on your balance transfers is 3.9% for nine months. However, you’ll be charged a 1% fee on the amount you transfer over (for a balance transfer of $1,000 that works out to $10.) After the nine months are up, you’ll be charged 12.99% on any remaining balance. If you make any additional purchases during that nine-month period, you will be charged 12.99% on new balances, if you don’t pay in full by the end of the grace period noted on each statement. Perks include: Extended warranty and purchase protection, plus a 15% discount on Cirque du Soleil shows in Canada and 20% off on shows in Las Vegas.

• 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 15.99% for cash advances
• Additional benefits: Extended warranty and purchase protection; discounts on Cirque du Soleil admission

Get more details about the BMO Preferred Rate*

MBNA True Line Mastercard*

The MBNA True Line Mastercard commands no annual fee, and when you sign up and transfer your balance within 90 days, you’ll get a full year interest-free. While there is a balance transfer fee of 3%, the long grace period makes this a strong card for those who need to pay down debt. At the end of the promotional period, any remaining outstanding balance will be subject to the regular rate of 12.99%, which is still significantly lower than most regular cards. A solid promotion and no annual fee make the MBNA True Line Mastercard one of the best balance transfer credit cards around.

• Annual fee: $0
• Balance transfer offer: 0% annual interest rate for 12 months on balances transferred within 90 days of account opening
• Interest rate: 12.99% for purchases and 24.99% for cash advances

Get more details about the MBNA True Line Mastercard

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 a long time. In addition to the introductory offer of 1.99% interest on balance transfers for the first nine months, you can collect Air Miles at an accelerated rate on your new purchases; you’ll get twice the miles when you shop at Air Miles partners, and 1 mile per $20 spent everywhere else. New cardholders receive 800 bonus 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 it 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: Twice 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 way to consolidate and address debt. But before you jump in, there are seven main variables you need to understand.

• Shop around for the rate, timing and terms that suit you best
  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 (sometimes as little as 0%) for a limited time (like six 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 are not racking up a lot of new purchases. The card you choose will depend largely on what is available when you’re looking, how long you think you need to pay off your debt and the card’s other terms.
• Make sure you’re eligible for the balance transfer
  Balance-transfer promotions are only valid when moving debt from a credit card at one bank to a card at another. It will not work between two cards from the same bank. 
• Timing is everything
  Balance-transfer promotions are available at the time that you make your application or sometimes shortly thereafter. Be strategic about when you apply and make sure you’re prepared to make the transfer. That means having the credit card company name, your name as it appears on the card, the debt total and the credit card number.
• Remember that balance transfer promotions don’t last forever
  The low, single-digit rates available on balance-transfer credit cards feature limited-time offers. Once the promotional period is over, the cards’ regular interest rates will kick in, which will affect your monthly payments. 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 the 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.
• Make your minimum payments
  Even when taking advantage of a balance transfer offer, you must make at least the minimum payment on the card, on time, each month. If you don’t, that super-low promotional interest rate can quickly be discontinued and the standard interest rate will kick in almost immediately. In other words, only take advantage of a balance transfer offer if you have the cash on hand to make at least the minimum payment each month and you’re in the right financial mindset to take on debt repayment.
• Balance transfer fees
  Some—but not all—cards charge a fee for balance transfers. This fee is expressed as a percentage of the total amount you want to move, and it usually ranges from 1% to 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. The additional cost may well be worth the money you’ll save at the new lower interest rate. But keep your eyes open for fee deals: Occasionally, a card will run a promotion where the balance transfer fee is waived.
• 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.

Do you earn cash back on balance transfers?

Like cash advances or purchases of money orders, balance transfers are not considered to be purchases so, in general, they’re not eligible for cash back rewards. There may be some very rare exceptions with certain promotional offers, but these are few and far between. That said, the interest saved by moving your debt to a card with a lower interest rate will far outweigh the value of most cash back returns.

How does a balance-transfer credit card impact my credit score?

When you apply for any credit card, you receive a hard credit inquiry that can temporarily bring your credit score down a few points. This includes balance transfer cards. However, this is not a reason to avoid applying. 

If you’re looking into a balance-transfer credit card, it’s likely because you’ve got some outstanding credit card debt. Moving that debt in order to reduce it will have a positive, lasting impact on your credit score in the medium to long term. 

The way this works is that the lower interest rates mean more of your money goes to paying down the balance, so you can reduce your debt load faster. A smaller debt load can improve your credit score because it lowers your credit utilization—a major credit score factor which measures the ratio between the balance and total credit limit. (Say you owe $600 on a credit card with a limit of $2,000. Then your credit utilization is 30%. Having a credit utilization score of 30% or lower is considered good.)

When you consider everything, the damage your debt load does to your credit score far outweighs the small and temporary effect on your credit score caused by an application. When it comes to debt, always look for the longer term solution.

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 2022 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.