Canada’s best no fee credit cards 2020

The best no fee credit cards in Canada 2020

Best no fee flat-rate cash back card

SimplyCash Card from American Express*

These days, many cash back cards offer attractive welcome bonuses, but once the promotion is over, the core card fails to impress. Not so with the SimplyCash Card from American Express. This card gives new cardholders 2.5% back for the first three months (up to $150 in cash bak), and afterwards reverts to a regular rate of 1.25%. While some cards complicate things by breaking down their rewards into spend categories, the SimplyCash lets you earn equally across categories—and, there is no limit to the cash you can earn back at the regular rate. Earn more by referring a friend—you can receive $100 in thanks each time, up to 15 friends.

The SimplyCash American Express includes shopping and travel protections, including $100,000 in travel accident protection, buyer’s assurance and purchase protection. And cardholders are automatically enrolled in American Express Invites, giving them access to premium entertainment options.

• Welcome offer: Get a welcome bonus of 2.5% cash back in the first 3 months, up to $150
• Earn rate: Get 1.25% cash back on all purchases regardless of purchase category (after the welcome bonus ends). Plus, no limit on the amount of cash back you can earn; Get $100 cash back for each approved referral up to a maximum annual referral bonus of $1,500
• Additional benefits: Includes access to select Toronto venues, including Roy Thomson Hall and Budweiser Stage. Plus, get Front Of The Line access to pre-sale tickets for the most in-demand concerts, theatre productions, restaurants and more; add up to 9 additional cards for free

Get more details about the SimplyCash Card*

Best card for cash back

Tangerine Money-Back*

With its competitive cash back and flexible spending categories, the Tangerine Money-Back Mastercard serves up a sweet deal. Cardholders automatically get 2% back on purchases in two spending categories, with a third category made available when they set up an automatic rewards deposit into a Tangerine Saving Account, which also doesn’t have any fees. All other spending earns 0.5%.

This means 2% cash back is available on purchases in up to three of the following categories: groceries, restaurants, gas, drug stores, recurring bill payments, entertainment, public transit and parking, furniture, home improvement, or hotel and motel stays.

And while this card offers only minimal perks like purchase assurance and extended warranty, it does allow you unlimited cash back, unlike many other cards that cap your rebates.

If you meet the $60,000 annual income requirement you’ll automatically be considered for the Tangerine World Mastercard, which comes with additional perks such as mobile device and rental car insurance.

• Welcome offer: New cardholders can transfer balances at a low promotional interest rate of 1.95% for six months (note that a 1% balance transfer fee will be charged)
• Earn rate: 2% cash back in up to 3 spending categories of your choice from 10 different options; and 0.5% on all other purchases; Cash back can be applied monthly, either to your credit card balance or deposited into your savings account
• Income requirement: $12,000
• Additional benefits: Purchase protection and extended warranties

Get more details about the Tangerine Money-Back Card*

Best no fee credit card for travel points

MBNA Rewards Platinum Plus Mastercard*

This card allows account holders to collect MBNA Points, redeemable for a variety of rewards including travel, cash back, hotels and merchandise. Trip-happy cardholders will enjoy the ability to redeem 100 Points for $1 worth of travel—an impressive redemption rate of 1% that will help you get to your dream vacation faster. If you choose to redeem your Points for cash back, the rate is 200 Points per $1. For groceries, gas and restaurant purchases, the rate is 2 Points per $1 on your initial $5,000 in purchases, and everything else comes in at 1 Point per $1. And—great news for those saving against a large travel purchase—the Points never expire as long as your account with MBNA is open.

Additionally, this card offers seven types of insurance, including unexpected return home, rental car collision, and accidental death and dismemberment, balance protection and extended warranty. While you’d likely need additional travel emergency insurance to fill in the gaps, this card gets you started—a rarity on a no fee card.

• Welcome offer: New applicants can earn up to 10,000 bonus Points and 4 Points per dollar spent on gas, groceries and restaurants for the first 90 days
• Earn rate: Earn 2 Points for every dollar spent on eligible gas, groceries and restaurants ($5,000 max annual spend per category) and 1 Point per dollar on everything else.
• Additional benefits: Unexpected return home coverage; rental collision and accidental death and dismemberment insurance; balance protection and extended warranty

Get more details about the MBNA Rewards Platinum Plus Mastercard*

Best card for no foreign transaction fees

Home Trust Preferred Visa*

There’s more than one way to improve cross-currency shopping, and ditching the foreign exchange fees altogether is a popular—but rare—option. The no fee HomeTrust Preferred Visa is one of the few cards available to Canadians that have no foreign transaction fees, and along with a respectable 1% cash back on all purchases without limit, it’s a card worth considering. Like many no fee cards, the HomeTrust Preferred doesn’t offer much in the way of insurance beyond purchase security, but it does provide one big bonus perk: membership in Roadside Assistance, which includes up to four service calls annually across North America. Also, when you use this card to pay for an automobile rental, collision and loss coverage are included. The HomeTrust Preferred Visa has a very accessible minimum annual income requirement of $15,000.

• Earn rate: 1% cash back on purchases
• Income requirement: $15,000
• Additional benefits: No foreign transaction fees on purchases in other currencies; Roadside Assistance gives cardholders up to 4 annual service calls across North America; rental car loss and collision coverage is included

Get more details about the Home Trust Preferred Visa*

Best no fee card for low interest

MBNA True Line Mastercard*

If you’re carrying a balance, you’ll want to get that debt onto a lower-interest card as quickly as possible. With a rate of 12.99% on balance transfers and new purchases, the MBNA True Line is worthy of consideration. Add the fact that this card commands no annual fee, and this is a powerful card for someone trying to pay off their debt.

• Interest rate on balance transfers and purchases: 12.99%
• Additional benefits: Add up to 9 authorized users without an additional fee

NOTE: this offer is not available for residents of Quebec

Get more details about the True Line Mastercard*

Best no fee student card

BMO CashBack Mastercard*

Canadian students have their own needs, including a way to cover the financial burden of tuition and school expenses, the need to establish a healthy credit history and an unending quest for cash on hand. With no annual fee, a welcome bonus of 5% cash back for three months (up to $100) and a low $15,000 annual income requirement, the BMO CashBack card is designed with students in mind.

The 5% cash back welcome offer is top-notch (and applicants who plan ahead might do well by timing their first three months with the beginning of a semester—those books add up!), and the cash back post-welcome is nothing to sneeze at: 3% on groceries and 1% on recurring bill payments (up to $500 spent per month in each category), and an unlimited 0.5% on everything else. As a student card, there’s no specific income requirements and you can get approved even if you’ve never had a credit card before. It also comes with standard insurance coverage like extended warranty and purchase protection. Overall, this is an attractive entry-level card.

• Welcome offer: New cardholders get 5% cash back for the first 3 months
• Earn rate: 3% cash back on groceries; 1% on recurring bill payments; 0.5% on everything else
• Additional benefits: Members receive 25% off at National and Alamo car rentals

Get more details about the BMO CashBack Mastercard*

Best retail or store card

PC Financial World Elite Mastercard*

For those who shop regularly at Loblaws banner stores and Shoppers Drug Mart (or Pharmaprix in Quebec), the PC World Elite Mastercard offers a great way to take advantage of one of the most popular and useful loyalty programs in the country: PC Optimum. Here’s how it works: When you use your PC World Elite Mastercard, you earn a minimum of 10 Points per dollar spent, with multipliers for purchases at Shoppers (45 Points per dollar), and Esso, PC Travel or any Loblaws-owned stores like No-Frills, Fortinos or Real Canadian Superstore (30 Points per dollar). Points are redeemed anywhere PC products are sold, in 10,000-Point increments, which works out to $10. PC Optimum is a valuable, easy-to-use program—and the PC World Elite can help you make the most of it.

• Earn rate: 45 Points per dollar at Shoppers Drug Mart; 30 Points per dollar at Esso, PC Travel or any Loblaws-owned stores; 10 Points per dollar everywhere else
• Income requirement: $80,000 personal or household income of $150,000
• Additional benefits: Travel emergency medical insurance; car rental loss or collision coverage; concierge services

Get more details about the PC Financial World Elite*

Honourable mention

Rogers World Elite Mastercard

With its regular 1.5% cash back and no annual fee, this card should make Canadian no-fee card users sit up and take notice—but for online shoppers and U.S.travellers, it could be a boon. That’s because purchases in U.S. currency earn 3% cash back, which covers the foreign transaction fee credit cards typically charge—between 2.5% and 3%. Cash rewards can then be redeemed towards any eligible purchases made on your card, for the ultimate in flexibility.

There is one drawback, which is that applicants must show an annual income of $80,000; that’s going to exclude many Canadians. Under the card’s terms, you’ll also need to spend at least $15,000 on the card over an annual review period (August 1 to July 31) otherwise you could be downgraded to the entry-level Rogers Platinum Mastercard that earns a lower 1% cash back. For those who can meet its income and spending requirements, though, the Rogers World Elite is a great option.

• Welcome offer: Get $25 in cash back rewards when you make your first card purchase within 3 months of receiving your card
• Earn rate: Get 3% cash back on purchases in U.S. currency, and 1.5% on all other purchases
• Income requirement: $80,000 individual, $150,000 household
• Additional benefits: Travel insurance including emergency air-transportation or evacuation; reimbursement of prepaid, non-refundable trip expenses up to $1,000 per person, or $5,000 per account; emergency dental care; and more

Advantages of a no fee credit card

The main advantage of a no fee credit card is exactly what the name suggests: There’s no fee. This means that unless you’re carrying outstanding debt, using the card costs you nothing. The appeal of a free card is obvious, but there are some things to consider, not the least of which is that no fee credit cards typically offer far fewer benefits and perks than cards that carry an annual fee. More on that below, but first let’s look at some of the top reasons why a no fee option might be best for you:

• You’re a student or just starting out
  Everyone needs to establish credit. Starting out with a no fee card lets you build up credit and understand your spending habits before you consider moving on to a card with an annual fee.
• You’re a light credit user
  Cards that carry a fee often have other valuable benefits or rewards—perks that offset the upfront cost with enough use. If you don’t foresee yourself spending enough to make back the cost of the annual fee, a no fee card may be the better choice.
• You already have a fee card
  There are lots of reasons to carry a second no fee card as a back-up. You could use an American Express with a fee as your main card, but what about places that don’t accept Amex? Or maybe you carry a rewards card with a fee and chose a no fee cash back card. It’s not a bad (or costly) idea to have a no fee card in your wallet.

No fee cards come with fewer frills

One major drawback to no fee cards is that, with few exceptions, they lack the perks and benefits—particularly insurance—that’s offered by many cards with an annual fee. Typically, no fee cards do include very basic protections such as zero liability, purchase protection and extended warranty, but you’ll likely miss out on travel medical emergency insurance and rental car collision coverage and on perks such as airport lounge access. Ultimately, you’ll have to weigh these benefits against the fees and decide whether a no fee card works best for you.

More about credit cards

• Best credit cards in Canada
• Best rewards credit cards
• Best travel credit cards
• Best cash back credit cards
• Best low interest credit cards
• Best balance transfer credit Cards
• Best student credit cards

Our methodology

For the best cash back credit cards 2020 ranking, MoneySense tapped into Ratehub.ca’s‡ credit card tool and calculated the numbers for both fee and no fee cash back rewards cards based on $2,000 in monthly spending. We used the following scenario: $500 on groceries, $200 on gas, $200 on restaurants, $125 on bill payments, $175 on travel, $225 on entertainment, $75 on pharmacy purchases and $500 on everything else.

The end game was a magic number—that is, the annual net reward in dollar terms to identify the top cash back cards for each type of spender. Our methodology also took into consideration other factors, including limited-time accelerated earn rates, the range of spending bonus categories, annual fee waivers, purchase protections and travel insurance perks.

‡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.