9 Best Credit Cards To Rebuild Credit In Canada (Oct 2022)

September 19, 2022
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There are quite a few good credit cards out there if you're looking to rebuild your credit, but some stand out above the rest for their low annual fees and monthly reports to credit bureaus. I constantly keep up with the credit cards and policy changes and make my recommendations below based on years of experience.

I recommend the Scotiabank Value Visa Card as the #1 credit card in Canada to rebuild your credit if you have bad credit history. It has a very low annual fee, offers a 0% introductory interest rate for the first 6 months, and comes with basic insurance as well as Avis and Budget car rental complimentary membership.

What Is A Credit Card For Rebuilding Your Credit?

Credit cards that help you rebuild your credit are a type of secured credit card that doesn’t have credit score requirements to apply. Secured credit cards report periodically (usually monthly) to the major credit card bureaus in Canada, Equifax, and TransUnion, which means that if you keep making your credit card payments on time, you will slowly start rebuilding your credit.

Secured credit cards work by using a security deposit as a means to ensure they will get their principal back. If you have low credit, you are less likely to pay back debts, and credit card issuers want to minimize that risk. Compared to regular credit cards, secured credit cards are very limited in terms of perks and usually don’t offer benefits like cash back or insurance. Anything over $50 is considered a high annual fee for a secured card. Similar to a debit card, you are limited by your security deposit and can’t spend more than the amount you deposited – that also means no overdraft. 

Without further ado, here are the best credit cards to rebuild credit Canada has to offer:

  1. Scotiabank Value Visa Card: Best for 0% introductory interest rate for the first 6 months
  2. Refresh Financial Secured Visa Card: Best for guaranteed approval
  3. Capital One Guaranteed Approval Secured Mastercard: Best for low minimum deposit
  4. Home Trust Secured Visa: Best for flexibility, choose between no-annual fee or low-interest options
  5. KOHO Mastercard Prepaid Card: Best for no foreign exchange fee
  6. Plastk Secured Credit Card: Best for generous welcome bonus and grace period
  7. President's Choice Financial Mastercard: Best for access to Mastercard Global Services
  8. Canadian Tire Triangle Mastercard: Best for cash back earn rate at CT stores
  9. Neo Financial Mastercard: Best for virtual card and no cash back limit per year

Scotiabank Value Visa Card

Great for building your credit, low balance transfer fees, and no annual fee
  • Annual Fee
    $29 (1st year free)
  • Interest Rate
    12.99% on purchase, 12.99% on cash advances
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    660+
  • Features & Benefits

    • 0% introductory interest rate for the first 6 months
    • Annual fee waived for the first year
    • Transfer your balance seamlessly and pay higher interest balances quicker
  • Pros & Cons

    Why we like it

    Great for building your credit, low balance transfer fees, and no annual fee

    Pros

    • 0% interest on cash advances for the first 6 months
    • No annual fee for the first year
    • Low interest rate of just 12.99%
    • A low annual fee of just $29 (waived the first year)
    • Great for building your credit score (reports monthly to TransUnion)
    • No fees when requesting additional cards

    Cons

    • No welcome bonus
    • No rewards or perks
  • More Details

    Bonuses and fees

    The Scotiabank Value Visa Card is a low-interest credit card with a low annual fee of $29, waived for the first year. This card offers an introductory interest on cash advances of 0% for the first 6 months, and 12.99% after that. The same interest rate applies to purchases.

    Perks and benefits

    • Great for rebuilding your credit history
    • Interest-free grace period
    • Pay lower interests by transferring your balances to the Scotiabank card
    • Set up payment schedules on purchases over $100 through Scotiabank’s SelectPay, and pay no interests
    • Complimentary Avis and Budget car rental membership plus 25% discount in Canada and the US

    Insurance

    The Scotiabank Value Visa Card offers two insurance bundles, Basic and Comprehensive Protection. 

    • The basic bundle includes medical insurance for up to $50,000
    • The Comprehensive bundle includes medical, job loss, strike or lockout, and disability insurance

Refresh Financial Secured Visa Card

Great for instant and guaranteed approval and credit score building
  • Annual Fee
    $49
  • Interest Rate
    17.99% on purchases
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • No credit check
    • Guaranteed approval
    • Minimum deposit of $200 ($10,000 max.)
  • Pros & Cons

    Why we like it

    Great for instant and guaranteed approval and credit score building

    Pros

    • No credit card or credit card history checks
    • All your credit card payments are reported to Equifax and TransUnion to help you build your credit
    • Instant and guaranteed approval for all applicants
    • Great for building your credit score
    • Low interest rate of 17.99% on purchases
    • No minimum personal income requirement

    Cons

    • Minimum deposit of $200
    • No welcome bonus
  • More Details

    Bonuses and fees

    The Refresh Financial Secured Visa Card is a secured credit card that offers an easy way to build your credit. It reports monthly to Equifax and TransUnion, and almost all applications are approved instantly. However, you will need to make a $200 deposit.

    This card has a base annual fee of $12.95, plus a maintenance fee of $3 per month. This adds up to $48.95 per year.

    Perks and Benefits 

    • Guaranteed approval
    • No hard credit check
    • All your payments are reported monthly to Equifax and TransUnion
    • Budget your spending by depositing exactly how much you want to spend
    • Deposit up to $10,000 and make everyday purchases

    Signing up for this secured card is very quick, and the application process can be completed online.

Capital One Guaranteed Approval Secured Mastercard

Great for building credit and no foreign exchange fees when purchasing abroad
  • Annual Fee
    $59
  • Interest Rate
    19.80% on purchases, 19.80% on cash advanes
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Minimum security deposit between $75 and $300
    • Get your deposit back in full after you close your account
  • Pros & Cons

    Why we like it

    Great for building credit and no foreign exchange fees when purchasing abroad

    Pros

    • Great for building credit (reports monthly to Equifax and TransUnion)
    • No annual fee
    • No credit card or credit card history checks
    • No foreign exchange fees when purchasing abroad or online
    • Flexible initial deposit ($49, $99, or $200)
    • Add additional authorized users at no cost

    Cons

    • High interest rates on purchase (26.99%)
    • No rewards on purchases
  • More Details

    Bonuses and fees 

    The Capital One Guaranteed Approval Secured Mastercard is a secured credit card targeted at individuals with low credit scores. It charges an annual fee of $59, which is considered high for secured cards, but it comes with some benefits like insurance and travel assistance.

    The Capital One Secured card reports monthly to Canada's two largest credit card bureaus.

    Perks and benefits

    • Guaranteed approval
    • Reports monthly to TransUnion and Equifax
    • Great for rebuilding your credit history
    • Zero liability policy

Home Trust Secured Visa

Great for building your credit and the option to pay an annual fee for reduced interest rates
  • Annual Fee
    $0
  • Interest Rate
    19.99% on purchases, 19.99% on cash advances
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Minimum security deposit of $500 ($10,000 max.)
    • Make purchases over the phone or online
    • Plan and book a vacation
    • Withdraw cash from over 1 million ATMs worldwide
    • Apply even if you declared bankruptcy in the past (A Discharge Certificate is necessary)
  • Pros & Cons

    Why we like it

    Great for building your credit and the option to pay an annual fee for reduced interest rates

    Pros

    • No minimum credit score or credit history requirements
    • Great for building your credit score (reports monthly to Equifax and TransUnion)
    • Option to pay a yearly fee of $59 to reduce purchase interests to 14.90% (from 19.99%)
    • Manage your account and pay bills from Home Trust Visa Online.
    • Sync with online payment platforms like the Apple Pay, Google Pay, and Samsung Pay
    • Fraud protection on all spendings

    Cons

    • Minimum deposit is $500
    • No welcome bonus or reward on purchases
  • More Details

    Bonuses and fees

    The Home Trust Secured Visa is a great way to start building your credit; it reports monthly to Equifax and TransUnion, and it doesn’t have a credit score minimum – virtually anybody can apply and get approved.

    In terms of fees, the Home Trust Secured Visa has two options:

    • Low-Interest Rate Option: $5 monthly fee (or $60/year) plus an interest rate of 14.99% on unpaid balances
    • No Annual-Fee Option: $0 annual fee (free) plus an interest rate of 19.99% on unpaid balances

    The main difference is that for the no annual fee option, you pay higher interest if you fall behind on payments. In general, we recommend the no annual fee option.

    You can start using the card after you make your first deposit; the minimum is $500, and the maximum is $10,000. Keep in mind you will only be able to use as much as you deposit.

    Perks and Benefits

    • Withdraw cash at any time from any Visa ATM worldwide
    • Use your card wherever Visa is accepted
    • You can apply even if you declared bankruptcy in the past
    • Budget your spending by limiting the amount you deposit
    • Completely covered against fraud through Visa’s Zero Liability Policy

KOHO Mastercard Prepaid Card

Great for automatic RoundUps and no annual fees
  • Annual Fee
    $0
  • Interest Rate
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    300+
  • Features & Benefits

    • No foreign exchange fee
    • Price protection
    • Complimentary personalized financial coaching
    • Receive both a physical and virtual card
    • Load funds via e-transfer or direct deposits
    • Sync your KOHO card with Apple Pay, Google Pay, and Samsung Pay and receive real-time spending notifications
    • 10% cash back for 90 days after referring a friend
  • Pros & Cons

    Why we like it

    Great for automatic RoundUps and no annual fees

    Pros

    • 0.5% cash back on all purchases
    • No annual fee
    • Refer friends and earn 10% cash back on all purchases for 90 days
    • Set up automatic RoundUps to grow your savings
    • Track your spending habits in real-time
    • Access your payroll 3 days early

    Cons

    • Low cash back rate plus no bonus points on any category
    • 1.5% forex exchange fees
  • More Details

    Bonuses and fees

    The KOHO Reloadable Prepaid Mastercard doesn’t require a high credit score or a good credit history. This card has no annual fees and is compatible with most other KOHO services: you can manage it from your KOHO mobile app, build your credit, and link it with your KOHO Savings account. Anybody can apply for the card and approve it in just a few minutes.

    Perks and Benefits

    Some of the perks and benefits of this card are a base back on all purchases, a promotional cash back rate at partner stores, and low foreign exchange fees. Here’s the breakdown:

    • 10% cash back at partner stores (online and in-person)
    • 0.5% cash back on all purchases

    Additional benefits include:

    • No hard credit checks
    • No foreign fees when purchasing abroad or online
    • Create a KOHO Save account and start to earn interests on your balance (1.2% APR)
    • Set up automatic RoundUps to grow your savings
    • Reload your card through e-transfers or direct deposits

Plastk Secured Credit Card

Great for building your credit and no-interest period applicable to all purchases
  • Annual Fee
    $120
  • Interest Rate
    17.99% on purchases, 21.99% on cash advances
  • Welcome Bonus
    5,000 pts
  • Rec. Credit Score
    300+
  • Features & Benefits

    • Earn 5,000 Rewards Points as a welcome bonus (redeemable after 3 months)
    • 0% introductory interest rate for the first 3 months
    • Monthly credit reports to Equifax
    • 25 days interest-free grace period
    • Minimum deposit of $300 and up to $10,000
  • Pros & Cons

    Why we like it

    Great for building your credit and no-interest period applicable to all purchases

    Pros

    • 5,000 bonus welcome points
    • Great for building your credit score (reports monthly to Equifax)
    • 0% interest rates for the first 3 months
    • 25 days no-interest period on purchases
    • No minimum credit score or credit history requirements
    • Low annual fee

    Cons

    • Minimum deposit of $300
    • High annual fee
  • More Details

    Bonuses and fees

    The Plastk Secured Credit Card is a premium secured card that offers a lot of perks and benefits for individuals with low credit scores. It has a base annual fee of $48, plus a maintenance fee of $6 per month. This adds up to a total of $120 per year.

    This card has no minimum income or credit history requirement, and you can start using it as soon as you make an initial deposit. The minimum deposit is $300, and you can load up to $10,000.

    Rewards

    Plastk points can be redeemed for merchandise, gift cards, a statement credit, and exclusive events. There’s a base earn rate, applicable across all types of purchases, of 1 point per $1 spent.

    Perks and benefits

    • 25-day interest-free grace period per year (3-days for cash advances)
    • Refer friends to earn bonus points
    • Instant approval
    • No hard credit check
    • Instant Balance Payments via Interac e-transfer

President's Choice Financial Mastercard

Great for earning PC points and very low credit score requirement
  • Annual Fee
    $0
  • Interest Rate
    20.97% on purchases, 22.97% on cash advances
  • Welcome Bonus
    20,000 pts
  • Rec. Credit Score
    560+
  • Features & Benefits

    • Earn 20,000 PC Optimum points as a welcome bonus
    • Extended warranty and purchase assurance
    • Access to Mastercard Global Services
    • Fraud protection and Proactive monitoring to manage and protect your credit card information
  • Pros & Cons

    Why we like it

    Great for earning PC points and very low credit score requirement

    Pros

    • 20,000 bonus welcome points
    • Earn 30 PC Optimum points per litre of gas at Esso and Mobil gas stations
    • Earn 10 PC Optimum points per $1 spent on groceries, household utilities, and beauty products
    • Doubles the warranty period offered by the manufacturer when using the card
    • No annual fee
    • Low credit score requirement (560+)

    Cons

    • No travel insurance
    • Requires a minimum yearly income of $60,000
  • More Details

    Bonuses and fees

    The President's Choice Financial Mastercard is a store credit card that offers very generous rewards when you shop at any of their partner stores. It doesn’t charge annual fees, and you can earn bonus points on most everyday purchases.

    Rewards

    PC Financial is partnered with a lot of stores; here are some of the best rewards by category:

    • 10 PC points per $1 spent on grocery stores (Loblaws, No Frills, and more)
    • 25 PC points per $1 spent at drugstores (Shoppers Drug Mart)
    • 30 PC points per litre of gas at Esso gas stations
    • 10 PC points per $1 spent everywhere else 

    Make sure to check the PC Financial site for new partner stores.

    Perks and benefits

    • 21-day interest-free grace period on purchases
    • 4 free additional authorized users
    • Extended warranty

Canadian Tire Triangle Mastercard

Great for high earn rate on Canadian Tire stores
  • Annual Fee
    $0
  • Interest Rate
    19.99% on purchases, 22.99% on cash advances
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    660+
  • Features & Benefits

    • Earn 15% cash back in CT Money on your first purchase as a welcome bonus
    • Redeem your CT Money at Canadian Tire, Sport Chek, Atmosphere, Sports Rousseau, Hockey Experts, and participating Sports Experts stores
    • No annual fee
  • Pros & Cons

    Why we like it

    Great for high earn rate on Canadian Tire stores

    Pros

    • No annual fee
    • 4% back in CT money on all purchases in Canadian Tire stores
    • Earn 5 cents per litre in CT money at Gas+ service stations
    • Collect 1.5% in CT money on all grocery purchase for up to $12,000 per year
    • Get your financed for purchases over $150 at select stores (no fees and no interests)
    • Customer service available 24/7

    Cons

    • You can only redeem CT points at select partner stores (CT, Sport Chek, Atmosphere and Sports Experts stores, among others)
    • High credit score to qualify (at least 660)
  • More Details

    Bonuses and fees 

    The Canadian Tire Triangle Mastercard is no-fee cash back. One of the downsides of the Canadian Tire credit cards is that rewards are paid in CT Money, and you can only redeem them at select stores like Canadian Tire, Sport Chek, and Atmosphere. However, if you shop often at any of these stores, you will find that the cash back rates are very generous.

    Rewards 

    This card has four main cash back categories. You can earn:

    • 4% cash back when purchasing at Canadian, Tire Sport Chek, L’Équipeur, Atmosphere, and more
    • 1.5% cash back at grocery stores
    • 0.5% cash back on all other purchases

    CT Money points are roughly equivalent to $1, which is more than reasonable. Also, keep in mind that cash back on grocery purchases is capped at $12,000 per year.

    Perks and Benefits 

    • Purchases over $150 at participating stores qualify for no fee, no interest financing
    • 5 cents cash back per litre of gas at partner gas stations Gas+ and Essence+

Neo Financial Mastercard

Great for cash back rate on your first purchase and no cash back limits
  • Annual Fee
    $0
  • Interest Rate
    24.99% on purchases, 26.99% on cash advances
  • Welcome Bonus
    N/A
  • Rec. Credit Score
    660+
  • Features & Benefits

    • Earn 15% in cash back on your first purchase as a welcome bonus
    • No annual fee
    • Quick sign-up process
    • Sync your Neo credit card with Apple Play and Google Pay
  • Pros & Cons

    Why we like it

    Great for cash back rate on your first purchase and no cash back limits

    Pros

    • Earn 15% cash back on your first purchase
    • Earn 5% cash back at partner stores (Canadian Tire, Sport Chek, Loblaws, and more)
    • No cap on how much cash back you can earn
    • No annual fees
    • No minimum income requirement
    • Mastercard Zero Liability Protection

    Cons

    • Needs a good credit score (660+)
    • Very limited features
  • More Details

    Bonuses and fees

    The Neo Financial Mastercard is a no-fee cash back card that is part of the Neo family of products (Savings, Invest, and Mortgages). Neo is partnered with over 7,000 merchants through the Merchant Partners program and offers time-limited cash back offers and promotions. When you make your first purchase at Merchant Partners, you will earn 15% in cash back (this may vary slightly depending on the offer).

    Rewards

    Neo doesn’t offer a fixed cash back rate. Instead, you will earn cash back based on the offers available and the plan you choose. You can expect average cash back of 5% on every purchase; they’re so confident about how much you’ll earn that if you fall below 0.5% on average, they’ll top you up to 0.5%. So, there is a base rate of 0.5% on all purchases – with the potential to be much higher. Make sure to take advantage of all the offers available.

    Perks and benefits

    • Cash back is credited instantly to your account.
    • Budgeting and spending insights tools, accessible from the app
    • Access to a virtual card
    • New monthly cash back offers when purchasing at thousands of stores
    • Zero liability policy
    • Minimum 0.5% cash back guaranteed

How Do Credit Cards Help You Rebuild Your Credit?

Traditionally, credit card companies take a risk of default when issuing a card to someone with low credit. Secured credit cards and credit cards dedicated to rebuilding credit eliminate this risk by requiring cardholders to make a security deposit, which acts as both collateral and credit limit; you can only use as much as you deposited. In that way, secured credit cards are similar to debit cards, but unlike debit cards, secured cards will help you rebuild your credit.

Most secured cards don’t have a minimum income or credit score requirement.

Pros & Cons Of A Credit Card Dedicated To Rebuilding Credit

Pros: Why A Secured Credit Card May Be Worth It

  • Reports monthly to credit card bureaus
  • Great for rebuilding your credit score
  • No risk of overspending – you can only spend as much as you deposit
  • Low-to-no credit score requirements

Cons: Why A Secured Credit Card May Not Be Worth It

  • High minimum deposits
  • Very limited perks and benefits
  • Your security deposit is locked in the account until you close it

How To Choose A Credit Card To Rebuild Credit In Canada

Choosing a secured credit card is easy – as long as you know what to look for. Consider all these factors before you choose one:

Credit bureau reporting

The main reason for getting a secured credit card is to rebuild your credit score. First, you should check if the secured credit card reports to the credit card bureau in Canada. The two biggest bureaus in Canada are Equifax and TransUnion – look for a secured card that reports to both, preferably monthly.

Annual Fee

Most secured credit cards are very limited when it comes to rewards, so if you apply for one with an annual fee, it’s very unlikely you will make enough from the rewards to make it back. Make sure to choose a secured credit card that has low-or-no annual fees. Anything above $50/year is considered a high annual fee for a secured credit card.

Minimum deposits

Credit cards dedicated to rebuilding credit usually have a mandatory security deposit. It works like a line of credit, and you won’t be able to use your card until you make the deposit. Minimum deposits usually start at $300 but can go as high as $500, depending on the issuers. Look for a card that has a low minimum deposit and a relatively high maximum deposit for the best flexibility.

Option to upgrade to an unsecured card

Most secured credit card issuers offer the option to upgrade your secured card into an unsecured credit card after you build up your credit to an acceptable level. When choosing a secured credit card issuer, plan ahead and keep this in mind.

Network Used

One of the first things you should look at is the network the secured card uses. In Canada, Visa and Mastercard are accepted almost everywhere, but you need to make sure it is accepted at your favorite stores. For example, stores like Costco and Walmart Canada don’t accept Visa.

How To Apply For A Credit Card To Rebuild Credit In Canada

Minimum Security Deposit

After you apply for a secured card, you will need to make a deposit before you start using it. This amount is usually between $200 and $500, and it determines how much you can spend using the card. Assuming your account is in good standing, you will receive your deposit back in full after you close your account.

Credit score

Secured that helps you rebuild your credit does not require a good credit score or, in most cases, a credit score at all. By design, credit card companies don’t take on any risk by issuing secured or prepaid cards, and cards are approved instantly without credit history checks.

Age

In Canada, the minimum age to request a credit card is the age of the majority. Teens under that age can’t get approved for credit cards but can be added as authorized users to one of their parent’s credit cards. For reference, the age of the majority in Alberta, Manitoba, Ontario, Quebec, Prince Edward Island, and Saskatchewan is 18 years old. In all other provinces, the age of the majority is 19.

Residency Status

Canadian credit cards are available to residents and non-permanent residents. However, most premium credit cards require you to be a Canadian resident. You don't even need a credit history for other card types like prepaid and secured credit cards. At the end of the day, residency requirements will depend on the specific credit card issuer and the type of card.

Income And Bank Account Requirements

Secured cards don’t have any income requirement. Some secured and prepaid cards don’t even require you to have a bank account, making them an ideal option for the unbanked and people who have low credit scores.

Credit Cards To Rebuild Credit In Canada FAQs

Are Credit Cards That Rebuild Credit Worth It?

Credit cards that rebuild credit might be worth it for you:

  • If you have a low credit score and are looking to rebuild it
  • If you want to limit your spending and are looking for a card that can help you manage your budget
  • If you don’t have a bank due to residency issues or otherwise but would like to receive payments directly to one of the major networks like Visa and Mastercard
  • If you have no credit history and find it difficult to apply for a premium credit card

Credit cards that rebuild credit might not be worth it for you:

  • If you are looking for a credit card with lots of perks and benefits 
  • If you want to earn interest on your deposit
  • If you have a high credit score and can apply for cards with better rewards

What Is The Best Free Credit Card For Rebuilding Credit In Canada?

The best free credit card for rebuilding credit in Canada is the Home Trust Secured Visa. It reports monthly to Equifax and TransUnion, doesn't have any credit score or credit history requirement, and is completely covered against fraud through Visa’s Zero Liability Policy.

How Do I Remove A Collection From My Credit Report In Canada?

There are two ways to remove collections from your credit reports:

  • If you believe the information on your report is inaccurate, you can file a complaint to dispute it
  • If the information is accurate, you have to wait 7 years from the date of the collection for the collection to be removed.

Does Having Multiple Credit Cards Affect Your Credit Score In Canada?

Yes, having multiple credit cards affects your credit score. In the long term, having multiple cards can be beneficial by decreasing your credit card utilization percentage. In the very short term, it may hurt your credit due to the credit history checks (if applicable).

Can I Get A Credit Card With Poor Credit In Canada?

Yes, you can get a credit card even with poor credit in Canada. There are cards dedicated to people with low credit, including secured and prepaid cards. Secured cards will help you rebuild your credit, while prepaid cards can make paying easier but will not help you with your credit.

What Credit Score Do You Need For A Credit Card In Canada?

It depends. Most credit card bureaus in Canada agree that an acceptable credit score for approval starts at 650, but credit cards like secured and prepaid don’t have such requirements.

What Builds Credit Beside Credit Cards In Canada?

Applying for personal loans, secured credit cards, Rent Reporting Services, and a Co-Signer are some of the most common ways to build your credit. Keep in mind that to apply for a personal loan, you will need an acceptable credit score, so it’s usually a good idea to start with a secured card that doesn’t have a credit score requirement.

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