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Best Low Rate Credit Cards in Canada for 2023 | My Rate Compass

Best Low Rate Credit Cards in Canada for 2023


Low Interest Rate Credit Cards

 

Credit cards can provide an excellent way to build your credit history. They allow you to shop online, book travel arrangements and have a source of payment in emergency situations. However, high interest rates can make a negative impact on your finances quicker than you might think. That’s why low interest rate credit cards offer more advantages for those seeking a credit card option when they are short on cash. Here’s everything you need to know about low interest rate credit cards.

National Bank Syncro Mastercard
National Bank Syncro Mastercard
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Details
Annual Fee: $35
Purchases Interest Rate: 10.7%
Cash Advance Interest Rate: 14.7%
Min Income Requirement: Not Available
Why Apply:
Recommended Credit Score:
670 900
Average to Excellent
Apply Nowlock On National Bank 's Secure Website

National Bank Syncro Mastercard Review 


Overview

The Syncro Mastercard’s main advantage is reduced interest rates. Cardholders can take advantage of significantly lower costs of financing. There is an annual fee of $35 to use this credit card. Learn more below.

Key Features and Benefits

  • Annual fee of $35 and variable interest rates
  • Purchase protection, fraud protection and extended warranty coverage included
  • Access to Mastercard Priceless Cities, a special travel experience program


Pros

  • The interest rate is the prime rate plus 4% for purchases, currently sitting at 10.70% which is much lower than industry standards
  • Insurance protection
  • National Bank is rated as one of the best banks for customer service support


Cons

  • No rewards
  • Balance transfers and cash advances have a interest rate of 4% plus prime, currently sitting at 14.70% but still competitive compare to other credit cards.


Takeaway

The main benefit of the Syncro Mastercard is the reduced interest rates on purchases, cash advances and balance transfers which can help you save significantly compared to standard credit cards at 19.99% or 20.99% for purchase interest rate. The card is an excellent option for people who carry a balance each month on their credit cards. There aren’t any other perks that come with this credit card. If you’d prefer access to some kind of rewards program, consider another credit card.


Legal notes :

® SYNCRO is a registered trademark of National Bank.

®Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated. Authorized user: National Bank

Scotiabank Value® Visa* Card
Scotiabank Value® Visa* Card
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Details
Annual Fee: $29
Purchases Interest Rate: 12.99%
Cash Advance Interest Rate: 12.99%
Min Income Requirement: Not Available
Why Apply:
  • Save on car rentals
  • Optional insurance coverage
  • Faster checkout
  • Free supplement card
Recommended Credit Score:
0 669
Poor or No Credit
Apply Nowlock On Scotiabank's Secure Website

0% introductory interest rate on balance transfers for the first 6 months 

The Scotia Value Visa is aimed at individuals looking for a good balance transfer credit that offers decent privileges and a lower interest rate beyond the introductory promo period. Although it comes with a minimal fee, customers who cannot pay their balance in full can take advantage of the low post-promotional rate of 12.99%. Plus, if you regularly rent cars from Avis, then you might get the best value out of this card.

 

Why We Like It:

  • Save on car rentals -Save up to 25% when you use the Scotia Value Visa to book your rental cars with AVIS and other budget rental car locations in Canada.
  • Optional insurance coverage - For a small fee, depending on the remaining balance on your credit card, you can receive financial protection from a range of life events such as job loss, disability, critical illness, and loss of life.
  • Faster checkout -The payWave feature helps you save time by allowing you to simply wave the card or use the app on your mobile phone to pay for small purchases.
  • Free supplement card - Get an additional supplementary cardholder at no extra charge.

Coming with an annual fee of $29 and a very good interest rate of 12.99% for both purchases and cash advances, the Scotiabank Value® Visa* Card is one of the best credit cards you can find on the market if you're keen on paying a low interest.

 

This card from Scotiabank comes with an amazing introductory offer of 0% for cash advances. Basically, during the first 6 months, you can consolidate your debt and save hundreds of dollars on interest.

 

The only requirement to access this card is a minimum income of $12,000 a year, which is quite low. Most Canadians can get this card with ease. Once you get it, you'll be able to capitalize on certain perks.

 

First, you can pay an interest rate on cash advances of just 0% for the first 6 months. This means the rest of the year. This is one of the most attractive offers you can get this year. Second, you can get a free supplementary card for one of your family members or close friends.

 

Lastly, this card allows you to save 25% on car rentals, get optional protection and pay quickly at the checkout using the Visa app.



The Scotia Value Visa is aimed at individuals looking for a good balance transfer credit that offers decent privileges and a lower interest rate beyond the introductory promo period. Although it comes with a minimal fee, customers who cannot pay their balance in full can take advantage of the low post-promotional rate of 12.99%. Plus, if you regularly rent cars from Avis, then you might get the best value out of this card.
HSBC +Rewards™ Mastercard®
HSBC +Rewards™ Mastercard®
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Details
Annual Fee: $25
Purchases Interest Rate: 11.9%
Cash Advance Interest Rate: 11.9%
Min Income Requirement: Not Available
Why Apply:
Low Interest Rate
Insurance Coverage 
Price Protection Service
Recommended Credit Score:
670 900
Average to Excellent
Apply Nowlock On HSBC's Secure Website

This card is perfect for any Canadian resident who wants a low-interest rate and coverage. With it, you can gain access to comprehensive travel insurance, price protection, zero liability protection, enhanced security, tap & pay, and worldwide acceptance.

Low Interest Rate :Reduce your interest on purchases, cash advances and balance transfers.

Insurance Coverage: Shop confidently knowing that your eligible purchases are well-protected when you make them using your card.

Price Protection Service: If you find a lower price within 60 days of your purchase the difference will be refunded – up to $500.

HSBC +Rewards™ Mastercard® Review

 

If you are looking for a card with low interest and annual fees, the HSBC +Rewards™ Mastercard® could be a good option. One of the main draws to this card is that not only do you have low fees and interest, but also the opportunity to earn points on every purchase. Not everyone is familiar with HSBC as a bank, as it is more internationally focused.

However, Canadians can find an excellent credit card with flexible redemption as well as an enticing welcome bonus offer that could be just what they are looking for in a credit card. Here’s our review of the HSBC +Rewards™ Mastercard® to help you decide if it will meet your needs.

HSBC +Rewards™ Mastercard® Welcome Bonus

 

It’s always smart to look at welcome bonuses credit cards offer new cardholders. You will find a pretty generous offer for becoming a HSBC +Rewards™ Mastercard® holder with a first year annual fee waiver for the Primary Cardholder and 35,000 bonus HSBC Rewards points with a minimum purchase of $2,000 within 180 days of account opening. Earn 5,000 points*when you start your application online ($25 travel value)

This is twice as much time to get your bonus points, as many banks often require the spend within the first three months. As well, an HSBC Rewards point is worth $0.005 when redeemed for travel, so you start off right out of the gate with up to $150 available. All of this for a low annual fee of just $25.

Benefits and Features

 

In hand with the above-mentioned bonus, although not an extensive list of perks, there are many other benefits and features with the HSBC +Rewards™ Mastercard® including:

  •       Low yearly fees of $25
  •       Low interest rate of 11.99%
  •       Double points on eligible dining and entertainment
  •       Price Protection for comparison shoppers
  •       Purchase insurance
  •       No minimum income requirement so anyone can apply
  •       Contactless payment perfect for pandemic shopping

The card is accepted worldwide and offers optional travel insurance for those who need it.

HSBC +Rewards™ Mastercard® Rates and Fees

 

As mentioned, you have very reasonable low fees with the HSBC +Rewards™ Mastercard® at just $25 a year for the primary cardholder and $10/year for associated cards issued. Other fees include:

  •       2.5% foreign currency fee
  •       5% of your balance transfer
  •       $2 withdrawal fees for ATM withdrawals in Canada
  •       $2 wire transfer fee

Where you really see a difference is in the low interest rate of just 11.9%. This represents exceptional savings for those who tend to carry a balance.

Earning HSBC Reward Points

 

HSBC +Rewards™ Mastercard® is designed to make it easy for people to both earn and redeem points. As with other cards, your points earned are broken down into categories, with 2 points for every $1 on eligible dining or entertainment purchases and 1 point for every $1 spent on everything else.

Redeeming HSBC Reward Points

 

Some people might find it confusing for points redemption as the value varies based on the rewards you choose. You can redeem for travel, gift cards, merchandise or financial rewards. If you were travelling 30,000 points is equal to about $150.

On the other hand, what people love about this approach is they have more flexibility and can use their points where they need them most or to suit their lifestyle. You can also use the Mastercard Pay App if you want to build up your cashback automatically then redeem your points to make purchases from their online rewards catalogue.

Redemption Options for HSBC Rewards Points

 

As mentioned, many people choose the HSBC +Rewards™ Mastercard® due to its flexibility on how points are redeemed whether it is travel rewards, gift cards, or merchandise. Your choices include:

  •       Personal Finance such as your mortgage, credit card or savings account
  •       Rewards towards gift cards, electronics and exciting experiences
  •       Travel points towards flights, hotels, car rentals, etc.

As long as your account is in good standing, you never lose your points. That means you can continue to use your card to earn the number of points needed to meet certain goals whether it is planning a trip, paying down your mortgage or buying something special.

 

HSBC +Rewards™ Mastercard® Eligibility and Requirements

 

You just need to meet the age of majority in your home province and be a Canadian resident to apply. With no minimum income, it becomes easier to be eligible as long as you have a fair credit score of 680 or higher. Just be sure you have proof of identity and residency such as a driver’s license. You can apply online with an ID ready to go for instant verification.

HSBC +Rewards™ Mastercard® vs Scotia Value Visa Card

 

Another popular choice in this category of credit cards is the Scotia Value Visa card. Here’s how it lines up with the HSBC +Rewards™ Mastercard®:

  •       Welcome offers: 0.99% introductory interest rate on balance transfers for the first 6 months
  •       Annual fee: $29, $0 for supplementary cards
  •       ARP interest rate: 12.99% on purchases, cash advances, balance transfers and Scotia Credit Card Cheques
  •       Credit Limit: $500.00 minimum
  •       Tap your Scotiabank Value® Visa* Card or your smartphone
  •       Save up to 25% off base car rental rates at participating AVIS and Budget locations in Canada and the U.S.

One of the biggest advantages of the Scotia Value Visa card is if you have a balance owed on a high-interest rate card you can balance that transfer to your new card and pay only 0.99% interest for six months. Planned right you can save tons of money, especially if you can completely pay down the balance in that period. However, the card doesn’t offer the same benefits and features as the HSBC +Rewards™ Mastercard® such as rewards, price protection, extended warranties and more. It all depends on your goals and what is most important to you.

Who is this card good for?

 

This is the best card for people who want a card with rewards, don’t mind paying a low annual fee and are looking to reduce the interest they pay. If you have a fair to good credit score, but no income, you can reap the rewards of the points program, enjoy a low interest rate and use your reward points to help establish your financial health.

You can also use the rewards to work towards something like a trip or purchase. The HSBC +Rewards™ Mastercard® might have limited perks but compared to the Scotia Value Visa card you really are seeing much more value. You get a good base card that helps you save not just on interest but also on purchases in many categories allowing you to compare shop and still see savings if you find a better offer within 60 days of your purchase. It also offers excellent protection for this category of card.

You can also enjoy more nights out with double points earned on dining and entertainment, with those points used to pay for future meals and fun. All in all it is a nice rounded card for those looking to collect points on a low fee, low interest card.

How to Apply for the HSBC +Rewards™ Mastercard®

 

As with any credit card you can apply online using their online application form. Be prepared to provide ID to prove you are a Canadian resident such as a driver’s license or something with your address and a photo as well as your social insurance number. The process is quick and painless and if approved you should receive your card within a few days via mail.

Conclusion

 

The bottom line is that the HSBC +Rewards™ Mastercard® is a solid card offering enough perks to make it worth the low $25 annual fee. It is really a great starter card, but also allows you to reduce how much interest you pay if you tend to carry a balance. If you are looking for basic perks including a very respectable and flexible rewards program, you can use your card to work towards a dream trip or to help you out financially.

You can also simply use your rewards towards purchases, and everything you purchase provides points. However, if you are interested in no fees or extensive benefits and insurance, this isn’t the card for you. Although you will find cards with many more benefits that also help you earn rewards more quickly, this is the perfect choice for a starter card, or for people looking for the best of both worlds: Low annual fees and interest rates plus a way to collect rewards to go towards financial support or living life to the fullest.


What is a Low interest rate credit card?

 

Every credit card applies an interest rate based on an annual percentage rate (APR). Credit cards with the lowest APRs tend to have the lowest interest rates. To be considered a low interest credit card, you are usually looking at an APR range starting at 12% to 14%. Interest applied to purchases fall into a range from 10% to 15% compared to the average of 19% to 22%. 

How do Low interest rate credit cards work?

 

As mentioned, all credit cards have an APR and interest rate. The interest rates displayed refer to the APR. However, credit card providers then break down that APR and apply it to any unpaid balance carried on your credit card statement. Canadian credit cards tend to have purchase interest rates sitting around 19.99%.

 

However, low interest rate credit cards, have lower rates. Purchase interest is only paid on balances typically carried after 21 to 25 days of the time the statement is sent. Once the grace period passes, interest is charged from the day of each purchase, not the statement date.


Low interest rate credit cards advantages

 

There are basically three advantages to low interest rate credit cards:

 

  1. Lower Interest Charges: A low interest rate credit card saves you money on monthly interest charges. If you tend to carry a balance, you pay more towards the principle borrowed which means it can be easier to pay down your balance. For example, a rate of 10% could save up to 50% off your interest charges compared to what you would pay on the average interest rate each month.
  2. Lower Yearly Fees: Because low interest credit cards come with very little perks you can usually find them with zero yearly fees, or at least very low fees.
  3. Assists with Debt Relief: The higher the interest rates, the harder it can be to repay credit card balances. Because interest continues to build up, even if you stop using your credit card until the balance is paid, you are still being charged interest on the balance. With lower interest rates, debt becomes more manageable. In fact, many people will choose a low interest rate credit card to pay off balances of higher interest rate cards to reduce the impact of owing money with a high rate of interest.

Low interest rate credit cards drawbacks

 

Despite the low interest rates there are some drawbacks to consider:

 

  • Limited Perks: Low interest rate credit cards don’t offer extensive programs that you might enjoy such as cash-back rewards or travel points. The main benefit lies in the low interest rate. If you don’t tend to carry a balance, there aren’t really any benefits to a low interest credit card.
  • Debt Build-up: Despite the low interest rates, sometimes it is easier to get caught up in carrying a balance since the interest rate is low. However, this can become a habit, so you end up paying more interest in the long run as you don’t feel a sense of urgency to pay down the balance.
  • Balance Transfer Fees: If you have your eyes on a low interest credit card to transfer higher interest rate balances and pay off debt, you could end up paying a very high transfer fee that offsets any financial benefits of the lower interest rate.
  • Higher Cash Advance Rates: While there is a low interest rate for balances, the interest rate charged for cash advances can be higher.



How to choose a Low interest rate credit cards

 

Because there are so many credit cards available, it is best to consider each card’s value. Some points to look at include:

 

  • Sign Up Incentives: Is there any form of incentive that is making it more inviting to sign up for this card? Although low interest rate credit cards tend to be pretty bare bones in rewards or incentives, you might find some lenders offering a better incentive.
  • Annual Fees: Many low interest rate credit cards are available without fees. There’s no point having to pay an annual fee if it eats into any savings you might enjoy from the lower interest rate.
  • Introductory Offers: Is the interest rate only low as an introductory offer? If so you might end up paying a far higher rate once the offer expires.

 

Basically, you want to find the lowest interest rate, with zero or very low annual fees and when possible, a little incentive thrown in for good measure.

Why choose a no annual fee credit card?

 

When you choose a no annual fee credit card you can save an average of $25 to $195 each year. Just keep in mind an annual fee is different from other fees such as late fee charges.

Bottom line

 

Low interest rate credit cards are ideal for those who tend to carry a balance. They can save you hundreds or even thousands in interest charges depending on the interest rate and how much you owe. There is a bit of a catch in that usually the lowest interest rates are available to those with the best credit ratings. So in order to take advantage of the low interest rate credit card you need to apply while your credit rating is still in good standing, not after you have fallen into debt.

FAQ’s

 

What is the best low interest credit card in Canada?

 

The HSBC +Rewards™ Mastercard® offers:

 

  • An 11.9% standard interest rate on purchases and balance transfers
  • Low $25 annual fee.
  • 2 Points for every $1 on eligible dining or entertainment purchases
  • 1 Point for every $1 on all other everyday purchases

 

You can reduce your interest on purchases, cash advances and balance transfers.

 

What credit card in Canada has the lowest interest rate?

 

The MBNA True Line Gold card offers has one of the lowest interest rate:

 

  • An 8.99% standard interest rate on purchases and balance transfers
  • Low $39 annual fee.
  • Add up to 9 authorized users with no additional annual fee


 When should you use a low interest credit card?

 

People with good credit scores who need to make a large purchase they need to pay off over time will benefit the most from a low interest credit card.

 



What is the difference between fixed rate and variable rate credit cards?

 

A fixed rate maintains the same interest rate while a variable interest rate can change over time based on market trends. Both have their pros and cons including:

 

Fixed Rate

  • Remains stable over time
  • The better your credit score, the lower your fixed rate will be
  • You never have to worry about what is happening in the market
  • No need to monitor changing rates
  • If interest rates go down, you could miss out on savings
  • Fixed loan interest rates tend to be higher than variable loans in general

 

Variable Rate

  • Tend to be lower rates compared to fixed rates
  • Lower rates can save you money over time
  • Not as stable which can lead to uncertainty
  • Your payments rise with interest rate increases so you pay more interest
  • Requires monitoring so you know how much interest you pay from month to month
  • Not safe if your finances can’t withstand changes in payments

 

When considering which is best for you, fixed loans are better for those on a budget while variable loans are suited to those who can withstand more risk should interest rates rise.


What is the best credit card with lowest interest rate?

The MBNA True Line Gold card has one of the lowest interest rate:

 

  • An 8.99% standard interest rate on purchases and balance transfers
  • Low $39 annual fee.
  • Add up to 9 authorized users with no additional annual fee

 


What is a balance transfer credit card?

 

A balance transfer credit card is usually offered at a lower interest rate. They allow you to move a credit card balance from an existing card to a different credit card. They are often available at impressive introductory APRs as low as 0%. This can be hard to pass up if you have a lot of money owing on a high interest credit card.

 

They make sense if you are able to pay off your balance before the special 0% interest rate offer expires. This allows you to pay down your balance interest free, saving you hundreds or even thousands of dollars depending on how much you owe.

 

However, they can also be too good to be true. For example, the 0% introductory offer could end before the balance is paid leading to higher interest rates. It’s also important to keep in mind the cards you wish to transfer from could charge a very high transfer fee. Depending on the balance, the fee, and your savings, it might not be worth it.

 

As well, some cards do not allow you to transfer balances for cards issued from the same lender. So if you have a lower interest rate or zero-interest introductory offer from the same bank where you want to transfer the money from, you might not be allowed to proceed with your plan. Last, but not least, on transferred balances, you can also face cancellation of the introductory zero interest rate if you don’t make your payments on time.

Author Bio

User
Mohamed Konate

Mohamed Konate is a personal finance expert, blogger, and marketing consultant based in Toronto. He is a former financial services professional who worked at major Canadian financial institutions for many years. He managed the marketing strategy around various financial products ranging from credit cards to lines of credit. Mohamed is passionate about personal finance and holds a Bachelor's in Business Administration from the University of Quebec (Montreal) and a Master's in International Business from the University of Sherbrooke (Quebec). He is also the author of the Canadian Credit Card Guidebook and earns rewards with the American Express Cobalt credit card.

 

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