Most of us are familiar with the common kinds of credit cards on the market and how they can help us meet our financial goals. Whether it’s a travel credit card that offers free perks and insurance benefits or a cash back credit card that helps you earn while you spend, it seems like every credit card has its unique purpose.
Best Balance Transfer Credit Cards for Canadians
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![A headshot of Rachel Cribby who is a contributing author at WealthRocket]()
Why you can trust us
The team at WealthRocket only recommends products and services that we would use ourselves and that we believe will provide value to our readers. However, we advocate for you to continue to do your own research and make educated decisions.
But what about the ever-so-mysterious balance transfer card? While not as flashy or enticing as the other card types out there, balance transfer credit cards serve a very important (if a tad utilitarian) function.
This function, though, comes with a catch — to get the most out of your balance transfer card, you need to know how to use them.
CIBC Select Visa Card
- Welcome Offer 0% interest balance transfer with a 1% transfer fee for first 10 months Terms and conditions apply.
- Annual rewards $0 Learn how we calculate this.
- Annual Fee $29 (first year waived)
- Minimum Income Required $15,000 household
BMO Preferred Rate Mastercard
- Welcome Offer 0.99% intro interest rate on balance transfers & 2% transfer fee for first 9 months
- Annual Fee $20
- Regular APR/Interest Rates 12.99%
- Recommended Credit 660 - 724
Scotiabank Value Visa Card
- Welcome Offer 0% interest on Cash Advances for first 6 months
- Annual Fee $29
- Regular APR Purchases: 12.99%, Cash Advances: 12.99%
- Recommended Credit 560 - 659
What is a balance transfer credit card?
If you’re staring at your screen quizzically, desperately hoping that somebody will tell you what a balance transfer is, hang tight. We’re about to tell you about a very effective but seldom discussed way to kill credit card debt.
A balance transfer credit card refers to a credit card that offers an extremely low interest rate for a set promotional period.
This period is often for six months or one year, and sometimes up to 18 months. This promotional rate is usually 3.99% or lower, although it can sometimes be as low as 0.00% interest.
The idea is to transfer your credit card balance from your credit card with a high regular interest rate and pay the balance off on your new card before the interest rate promotion expires.
It’s simply easier to pay off your credit card balance when you are not paying up to hundreds of dollars of interest payments every month.
How does a balance transfer credit card work?
Balance transfer credit cards sound pretty great so far, right? A credit card with a low or non-existent interest rate designed to make paying off your balance easier? While there aren’t catches per se, there are some things you need to know before you shout, “sign me up!”
Balance fee and annual fee
When you take advantage of a balance transfer credit card, you are charged a fee in the amount of money you transfer.
For example, if you transfer a credit card balance of $10,000 with a fee of 1%, you will be charged $100.
Most balance transfer credit cards will also come with some form of an annual fee.
Interest rate expiration
As we mentioned earlier, if you do not pay off your transferred balance before the end of the promotional rate period, you will be subject to regular interest rates.
Card qualifications
In order to make use of a balance credit card, you will need to have your application approved. This means having a decent credit score and meeting the minimum income requirement for the card.
How to perform a balance transfer
If you would like to take advantage of a balance transfer offer, you will first need to apply for the card.
Upon application approval, you will then need to request the transfer. This action is typically done by cheque, online, or by telephone.
This will involve giving your new account information to your existing account so that they can perform the transfer.
If you perform this action by cheque, you may have the option to make the cheque made out in your name. Just make sure it’s not processed as a cash advance.
The best balance transfer credit cards in Canada: 4 options
Canadian credit cardholders have their fair share of options when it comes to balance transfer cards, with standout options including:
1. CIBC Select Visa
- Promotional interest rate: 0.00% for 10 months
- Regular interest rate: 13.99%
- Transfer fee: one-time fee of 1% of balance
- Annual fee: $29
The CIBC Select Visa is commonly heralded as the holy grail of balance transfer credit cards, and with good reason!
This card stands out for offering zero interest on any transferred balance for ten months.
If you cannot pay off your balance in these ten months, you will be subject to the card’s 13.99% interest rate, which is still reasonable compared to the average interest rate of 19.99%.
You will only be able to transfer 50% of your credit limit with this card. It is also only available for new cardholders who apply online.
CIBC Select Visa Card
- Welcome Offer 0% interest balance transfer with a 1% transfer fee for first 10 months Terms and conditions apply.
- Annual rewards $0 Learn how we calculate this.
- Annual Fee $29 (first year waived)
- Minimum Income Required $15,000 household
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Pros
- Low monthly interest fee
- Save money on previous debts
- Save at the pump
Cons
- Limited perks and rewards
- Annual fee
- Low monthly interest fee
The CIBC Select Visa is a low-interest credit card designed specifically for lower-income Canadians to help pay down their debt. It also offers the ability to transfer old debt to your new card with a 0% interest rate for 10 months (with a 1% transfer fee). Learn more about the card in the review below.
2. BMO Preferred Rate Mastercard
- Promotional interest rate: 3.99% for nine months
- Regular interest rate: 12.99%
- Transfer fee: one-time fee of 1% of balance
- Annual fee: $20
The Bank of Montreal’s answer to the balance transfer card comes from the all-around agreeable BMO Preferred Rate Mastercard. The rate in question is the 3.9% interest rate that lasts for nine preceding months. The card also comes with other benefits such as entertainment discounts and warranty and purchase protection, which is quite uncommon for balance transfer cards.
The BMO Preferred Rate Mastercard does come with a small annual fee of $20, though this is refundable in your first year.
BMO Preferred Rate Mastercard
- Welcome Offer 0.99% intro interest rate on balance transfers & 2% transfer fee for first 9 months
- Annual Fee $20
- Regular APR/Interest Rates 12.99%
- Recommended Credit 660 - 724
- $20 annual fee (waived first year)
- Add another card holder for free
3. Scotiabank Value Visa
- Promotional interest rate: 0% for 6 months
- Regular interest rate: 12.99%
- Transfer fee: None
- Annual fee: $29
Scotiabank’s balance transfer credit card is the Value Visa, which comes with an impressive line of enticements, including a next-to-zero interest rate of 0% for six months, as well as a relatively low regular interest rate of 12.99%. The standout trait of this card is that it does not come with a balance transfer fee.
The card also notably comes with a discount on rental cars from Avis rental, which makes it the obvious option for frequent travelers.
Scotiabank Value Visa Card
- Welcome Offer 0% interest on Cash Advances for first 6 months
- Annual Fee $29
- Regular APR Purchases: 12.99%, Cash Advances: 12.99%
- Recommended Credit 560 - 659
- First year annual fee waived
- Pay no balance transfer fees at the time of transfer
- 0.99% interest on balance transfers for the first 6 months
- Realitevly low APR rate of 12.99%
- Save up to 25% on car rentals at participating AVIS locations
4. Tangerine Money-Back Credit Card
- Promotional interest rate: 1.95% for 6 months
- Regular interest rate: 19.95%
- Transfer fee: 1%
- Annual fee: $0
Although this card from Canada’s online bank darling Tangerine comes with a high regular interest rate that is nothing to write home about, it does come with an impressively low balance transfer promotion of 1.95% for six months. What’s more is that this card will also allow you to earn your money back on regular purchases (up to 2%). It is unusual for a balance transfer card to offer such a perk.
With an income requirement of $12,000, this card is also easier to qualify for than some of the other entries on this list.
Tangerine Money-Back Credit Card
Rewards
- 2% Earn 2% cash back on certain purchases in your chosen categories.
- 0.5% Earn 0.5% cash back on all other purchases.
- Welcome Offer 10% cash back on up to $1,000 in purchases in first 2 months Terms and conditions apply.
- Annual Rewards $282 Learn how we calculate this.
- Annual Fee $0
- Minimum Income Required None
Pros
- No annual fee
- No limit to the amount of cash back you can collect
- You can choose your cash back categories
- Rewards can be redeemed on credit card balance or deposited to a Tangerine savings account
Cons
- Maximum cash back in any given spending category is 2%
- Not a lot of other card benefits
The Tangerine Money-Back Credit Card is a cash back card that allows you to earn in up to three spending categories, including gas and groceries, restaurants, home improvement, and furniture. Flexibility is key with this card, in that it’s up to you which of the 10 spending categories you get to earn cash back in, and you can change them at any time and they’ll update for the next billing cycle. Cash back can be deposited into a savings account (giving you three spending categories instead of two), or received as a statement credit.
Our final thoughts
Many Canadians often write off balance transfer cards as too niche, and while their focus may be narrow, they play a very important role.
Even when considering balance transfer fees, balance transfer credit cards are a wonderful reprieve for any consumer who finds themselves buried in debt. They can also be the valuable light at the end of the tunnel for anyone who feels kept down by high-interest rates and debt cycles.
Rachel Cribby
Frequently asked questions
A balance transfer can certainly be a good idea, depending on a person’s situation.
If you feel stifled by a credit card with a high balance that accrues nonstop interest, it might be time to transfer this balance to a credit card with a low or non-existent interest rate.
However, it would help if you had a plan for yourself that allows you to pay off the entire balance before your card reverts to its regular interest rate — otherwise, your plan could backfire.
In most cases, when you transfer your credit card balance, you will be required to pay a fee at the time of transfer. This is usually in the form of a percentage of the balance you are transferring. A common transfer fee is 1% (e.x., if the balance you’re transferring is $1,000, you will pay $10). However, in some cases, you may find a balance transfer credit card without a fee.
Again, whether or not you should pay off your existing credit card debt using a personal loan or a balance transfer is a personal matter and doesn’t usually come down to a right or wrong answer.
It will often come down to the method that you qualify for, and your qualification will depend on a variety of factors like credit score, income, and credit usage.
It may be worth comparing the interest rate offered with a personal line of credit with the interest rate you would get on a balance transfer credit card.
While the balance transfer card’s interest rate may be lower, the promotional period is another factor to consider.
