The Best Cash Back Credit Cards in Canada 2024

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Anyone that’s looking to put more money back in their pockets should consider one of the best cash back credit cards in Canada. The concept is simple, every time you make a purchase, you’ll earn some cash back. However, with so many credit cards that earn you cash back, some people aren’t sure which one to choose.

Unlike travel rewards credit cards, where there are so many variables to consider, cash back cards are easier to narrow down since there are only a few categories you need to think about. Here’s my list of the best cash back credit cards in Canada.

Credit cardBest cash back card for
American Express Cobalt CardOverall spending
BMO CashBack® World Elite®* Mastercard®*Highest earn rate
Tangerine Money-Back CardNo fee
American Express SimplyCash Preferred CardFlat rate
PC Financial World Elite MastercardGroceries/PC Optimum
Wealthsimple Cash CardNo foreign transaction fees
Scotiabank Momentum Visa Infinite CardInsurance
Triangle World Elite MastercardRoadside assistance
KOHOPrepaid

Best cash back card for overall spending

American Express Cobalt Card

  • $12.99 Monthly fee ($155.88 yearly)
  • 1,250 monthly points when charging $750 each month for a year (15,000 points total)
  • Earn 5 points per $1 spent on eats and drinks
  • Earn 3 points per $1 spent on streaming services
  • Earn 2 points per $1 spent on travel
  • Earn 1 point per $1 spent on all other purchases
  • MESSAGE ME FOR A REFERRAL LINK

Without a doubt, the best cash back credit card in Canada for overall spending is the American Express Cobalt Card. Your earning rate is 5 American Express Membership Rewards points per $1 spent on eats and drinks (including grocery stores and dining), 3 points on popular streaming services, 2 points on travel and transit, and 1 point on all other purchases. Even though there’s a monthly cap of $2,500 for each of these bonus categories, that’s the most cash back you’ll earn.

Now some people will rightly point out that this card earns you American Express Membership Rewards points, and not cash back. What some people don’t realize is that you can redeem 1,000 American Express Membership Rewards points for a $10 statement credit. This effectively makes the American Express Cobalt Card a cash back card. You can still use your points on travel purchases or transfer them to travel partners such as Aeroplan and Marriott Bonvoy. You get a lot of redemption options with this rewards program.

Eligibility: There’s no minimum income required. A credit score of 700 is recommended before applying.
Welcome bonus: Typically, you’ll earn 2,500 American Express Membership Rewards points when you spend $500 monthly for the first 12 months. That’s 30,000 bonus American Express Membership Rewards points you can earn in the first year. The offer has also been as low as 1,250 monthly points for 12 months, with a minimum spend of $750 each month.

Best cashback card with the highest earn rate

BMO CashBack® World Elite®* Mastercard®*

  • $120 Annual fee – First year free*
  • 10% cash back on all purchases for three months (up to $260)
  • 5% cash back on grocery purchases
  • 4% cash back on transit purchases
  • 3% cash back on gas and electric vehicle charging
  • 2% cash back on recurring bill payments
  • 1% cash back on all other purchases

If you’re the type of person who wants to maximize their return, then the BMO CashBack® World Elite®* Mastercard®* will be of interest. The earning rate is 5% cash back on groceries, 4% on transit, 3% on gas, 2% on recurring bills, and 1% on all other everyday purchases. There’s simply no credit card with a higher earn rate.

There is a catch. There’s a spending cap for each bonus category of $500 on groceries, $400 on transit, $300 on gas, and $500 on recurring bill payments. Once you hit those caps, you’ll earn 1% cash back. On a positive note, you only need $1 in cash back rewards earned to get paid out as a statement credit. If you typically spend more than that, the American Express Cobalt Card or Scotiabank Momentum Visa Infinite card would likely be better choices.

Additional benefits you get with this card include airport lounge access (no passes), roadside assistance, concierge service, travel insurance, and extended warranty.

Eligibility: Minimum personal income of $80,000 or a household income of $150,000. A credit score of 700 is recommended.
Welcome bonus: Usually 10% cash back for the first three months, up to $2,600 in spending ($500 on groceries, $300 on transit, $300 on gas, $500 on recurring bills, and $1,000 on everything else). The annual fee of $120 is sometimes waived.

Best cash back card with no annual fee

Tangerine Money-Back Card

  • No annual fee
  • 10% cash back up to $1,000 in spending ($100 cash back) for the first 2 months
  • 2% cash back on up to 3 categories
  • 0.5% cash back on all other purchases

Some people don’t like paying an annual fee for a credit card. Fortunately, the Tangerine Money-Back Credit Card doesn’t charge you an annual fee, and you get a crazy amount of flexibility. si

Instead of having defined bonus categories where you get an increased earning rate, the Tangerine Money-Back Card allows you to select up to three categories to earn 2% cash back. You get two categories, to begin with, and you get a third category if you set your cash back to automatically deposit into your Tangerine bank account. All other purchases earn you 0.5% cash back. No other credit card in Canada allows you to pick your categories, so this card is extremely valuable depending on your chosen categories.

Admittedly, 2% isn’t as high as some other cards on this list, but the ability to choose your own categories is a game-changer. Some people will use this card to complement another cash back card. That would allow them to earn at least 2% cash back on multiple categories. Alternatively, you can keep things simple and use this as your primary credit card.

Eligibility: A personal income of $12,000. If you have a personal income of $60,000, a household income of $100,000, or a balance of $250,000 or more with Tangerine, you may qualify for the Tangerine World Mastercard. A minimum credit score of 660 is recommended.
Welcome bonus: Typically 10% cash back up to $1,000 in spending in the first two to three months. This bonus offer has been worth as much as 15%.

Best cash back card with a flat earn rate

SimplyCash Preferred Card from American Express

  • $9.99 monthl fee ($119.88 annually)
  • Spend $750 each month and get a $40 statement credit for 10 months ($400 total)
  • 4% cash back on groceries ($1,200 cash back max)
  • 4% cash back on gas purchases
  • 2% cash back on all other purchases
  • Travel & mobile device insurance
  • Buyer’s assurance & purchase protection

Instead of having to worry about enhanced earning rates, it could be worthwhile to get a flat-rate card that gives you the same cash back on all your purchases. The American Express SimplyCash Preferred Card gives you 4% cash back on gas and groceries (capped at $1,200 annually for grocery purchases). All other purchases earn you 2% cash back with no limits.

Having a base earn rate of 2% cash back is incredibly rare, so this can be a great card for people who spend a lot of money. The card has a monthly fee of $9.99 ($119.88 annually), so that’s something to factor in when figuring out your earning potential.

The other benefits you get include mobile device insurance and American Express experiences. With the experiences, you get some great perks, such as front of the line access at some of the most popular concerts and offers where you can earn statement credits on your everyday purchases.

Eligibility: There’s no minimum income required. A credit score of 660 is recommended before applying.
Welcome bonus: New cardholders usually get a $40 statement credit when spending $750 each month for 10 months. That’s a total of $400 in statement credits you could earn.

Best cash back card for groceries/PC Optimum

PC Financial World Elite Mastercard

  • No annual fee
  • Earn 45 PC Optimum Points per $1 dollar spent at Shoppers Drug Mart
  • Earn 30 PC Optimum Points per $1 spent where PC Products are sold and at PC Travel
  • Earn at least 30 PC Optimum Points per litre at Esso/Mobil locations
  • Earn 10 PC Optimum Points per $1 spent on all other purchases

With the PC Financial World Elite Mastercard, this card is you’ll earn 30 PC Optimum points per $1 spent at Loblaws’ owned grocery stores, such as No Frills, Loblaws, and Real Canadian Store. If you don’t shop at Loblaws’ banner stores, you’re better off with the American Express Cobalt Card or BMO CashBack® World Elite®* Mastercard®* since they have higher earn rates than the

What makes this card stand out for groceries is that you earn PC Optimum points, which is similar to cash back rewards. The regular redemption rate is 10,000 PC Optimum points for $10 off. However, Shoppers Drug Mart often runs bonus redemption events where you can get increased value. For example, you might be able to redeem 50,000 points for $65 off or 250,000 points for $400 off. If you’re maximizing PC Optimum, then you can save big.

In addition, PC Optimum has many in-store and targeted offers. That means you can earn additional points. Since earning points is just as important as redeeming them, PC Optimum offers you many options.

Eligibility: A personal income of $80,000 or $150,000 is required. That said, two other PC Financial Mastercards have lower earning rates and a lower minimum income requirement. A credit score of 700 is recommended.
Welcome bonus: You can sometimes get up to 100,000 PC Optimum points when signing up in a store.

Best cash back card without foreign transaction fees

Wealthsimple Cash Card

  • No annual fee
  • Up to $3,000 welcome bouns
  • 1% back in cash, stocks, or crypto on all purchases
  • 4% interest on deposited funds
  • No foreign transaction fees on purchases or ATM withdrawals
  • CDIC insurance protection

If you’re looking for a cash back card with no foreign transaction fees, the Wealthsimple Cash Card is a good choice. You’ll earn a straight 1% cash back on all eligible purchases. This includes foreign currency purchases. Note that this is a prepaid card, so you must load funds before using it. That said, any money you put on the card earns you interest.

Another reason this card is great is that you won’t pay any FX fees when using a foreign ATM. That said, the ATM may charge you a one-time fee of $3 to access its machines. Having access to no foreign transaction fees on purchases and cash withdrawals is ideal.

Eligibility: Must have a Wealthsimple Cash account, but no income or credit history is required.
Welcome bonus: Up to $3,000 (it’s random)

Best cash back card for insurance

Scotia Momentum Visa Infinite Card

  • $120 annual fee – first year free
  • Earn 10% cash back on all purchases for the first 3 months (up to $2,000 in purchases)
  • Earn 4% cash back on groceries, recurring bills, and subscription purchases
  • Earn 2% cash back on gas and daily transit purchases
  • Earn 1% cash back on all other purchases with no cash back limit
  • Travel and mobile device insurance included

When you look at the earning rate of 4% cash back on groceries and recurring payments, 2% on gas and transit, and 1% on everything else, you’d think the Scotiabank Momentum Visa Infinite Card would be best for groceries. However, as you’ve already learned, two other cards already give you a higher earning rate at grocery stores. That’s why I recommend this card if you’re looking for excellent insurance coverage.

The included travel medical insurance covers you for 15 days if you’re under the age of 65. You also get a trip protection plan that covers trip cancellation/interruption, flight delay, delayed and lost baggage, and rental car collision loss/damage insurance. In addition, you get mobile device insurance, purchase security, and extended warranty. 

Eligibility: A personal income of $60,000, household income of $100,000 or a minimum of $250,000 of assets under management. A credit score of at least 700 is recommended.
Welcome bonus: Usually 10% cash back for the first three months, up to $2,000 in spending, and no annual fee for the first year.

Best cash back card for roadside assistance

Tangerine World Elite Mastercard

  • No annual fee
  • Earn 4% in CT Money at Canadian Tire, Sport Chek, Mark’s/L’Équipeur, Atmosphere, Party City, Sports Rousseau, Hockey Experts, L’Entrepôt du Hockey, and participating Sports Experts stores
  • Earn 3% in CT Money on grocery purchases (up to $12,000), 1% on all other purchases
  • Earn 7¢ per litre in CT Money on premium fuel, and 5¢ per litre on all other fuel types at Gas+/Essence+ locations
  • Free Roadside Assistance Gold Plan
  • No fee, no interest financing available

One often overlooked benefit is roadside assistance. With this service, you can help if you ever have car issues at home or on the road. With the Triangle World Elite Mastercard, you get Canadian Tire’s gold roadside assistance plan for free. It comes with 24/7 service, five service calls a year, tows up to 200 kilometres, and more.

Although you’re earning CT Money as your reward, it’s like cash back and can be used at participating stores such as Canadian Tire, Party City, Markls, Sport Chek, and more. In addition, if you download the Triangle Rewards app, they often have targeted offers where you can earn even more CT Money.

Note that you must make at least one purchase every 12 months for your card to remain active. This is a small price to pay to get free roadside assistance.

Eligibility: A personal income of $80,000 or $150,000 is required. A minimum credit score of 700 is recommended.
Welcome bonus: None.

Best prepaid cash back card

KOHO

  • No annual fee
  • $20 for free when signing up with a referral link
  • Earn up to 5% cash-back
  • 1% cash back on groceries and transportation
  • 0.5% interest on your spending and savings accounts with direct deposit set up

Prepaid credit cards have evolved over the years. Traditionally, people would only get them if they didn’t qualify for a traditional credit card or wanted simplicity. However, these days they come packed with benefits and are tied to an app that gives you insights into your spending. 

With KOHO, you’ll pay no annual fee, and you’ll earn 5% cash back on all your purchases. Additionally, if you have a direct deposit set up, you’ll earn interest on all funds deposited into your account.

Many people like KOHO because it teaches you to be smarter with your money. For example, you can set rounds up for all your purchases. That allows you to save automatically. Additionally, you get real-time spending insights, which can be helpful if you’re trying to balance your budget.

Since this is a prepaid card, you won’t build your credit score. That said, KOHO does offer a premium service where you can build your credit for a monthly fee.

Eligibility: None.
Welcome bonus: $20 when signing up with a referral link.

How do cash back credit cards work?

Cash back credit cards give you money back as your reward for charging your purchases to your credit card. Cash back is highly appealing to people who want simple rewards. Unlike travel rewards, there’s no need to worry about dynamic pricing, blackout dates, or expiring points. Cash back puts money back into your pocket.

How much you’ll get depends on the earn rate of the card. All cash back credit cards have a base earn rate, but most also give you an accelerated earn rate on select categories. For example, you might earn 5% cash back on grocery purchases but 1% on everything else.

Generally, you want to choose a cash back credit card that aligns with your spending. For example, if you do the majority of your spending on gas and transit, then pick a card that gives you a high return on those categories.

How do cash back credit card earning rates work?

Every cash back card has different earning rates. Generally speaking, they can be broken down into two categories:

  • Accelerated earn rate – This is where you’ll earn additional cash back on select categories.
  • Base earn rate – This is the amount of cash back you’ll earn on all other categories that don’t fall under the accelerated rate.

Accelerated earn rates are appealing since it’s like bonus rewards on select categories. That said, every credit card provider will typically cap the accelerated earning rate at a certain amount (typically $25,000 – $30,000). Once you’ve reached that amount, you’ll get the base earn rate.

Generally speaking, the base earn rate for cash back cards is 1%. That said, some entry-level cards have a base earn rate of less than that. It’s also worth mentioning that some cash back cards offer a flat rate of cash back regardless of where you make your purchases.

Every credit card chooses which categories have an enhanced earning rate. There’s one exception to this rule in the Tangerine Money-Back Card: you can choose up to three categories where you earn 2% cash back. All other purchases would earn you 0.5% cash back.

What are cash back credit card categories?

Card issuers (Visa, Mastercard, and American Express) assign every retailer a merchant category code (MCC). When a credit card offers an accelerated earn rate on certain categories, the MCCs would be coded, so you get that rate.

In the past, categories were straightforward to understand, but credit card providers now often lump some together or have created new categories that offer additional cash back to appeal to consumers. The most common categories you’ll see these days include:

  • Grocery – This category applies to any purchases made inside a grocery store. This would include gift cards, so if you bought a Costco gift card at Metro, you’d get the accelerated groceryearn rate for that purchase. Keep in mind Costco itself doesn’t count as a grocery store but Metro, Sobeys, Farm Boy, and Loblaws Superstores do. 
  • Restaurants – Cafes, bars, coffee shops, and restaurants would all be categorized as restaurants.
  • Food delivery – While most food delivery companies – such as UberEats, DoorDash, and SkipTheDishes – would fall under restaurants, some credit cards separate them under food delivery.
  • Travel – Anything related to travel, including airline purchases, hotels, theme park tickets, cruises, and car rentals, typically falls under travel.
  • Gas – Any time you make a purchase at a gas station, it would fall under the gas category. 
  • Transportation – Any expenses related to parking, public transit, taxis, and EV charging would be types of transportation merchants.
  • Entertainment – Entertainment is a broad category that covers things such as movies, bowling alleys, theatre productions, and live concerts.
  • Streaming services – Generally speaking, this refers to things, such as select streaming services, including Spotify, YouTube, Disney+, and Netflix.
  • Gaming – With gaming, it would be stores that offer digital gaming downloads, such as Nintendo and Steam. In-game transactions and yearly online subscriptions would typically count too.
  • Recurring bill payments – When it comes to recurring bills, it usually refers to things such as utilities and your cell phone bill. 
  • Drug stores and pharmacies – this may include typical drugstore purchases made at well-known Canadian drug stores such as Shoppers Drug Mart.

It’s important to see what merchants are covered in accelerated earn rate categories before signing up for a cash back credit card. For example, the Tangerine Money-Back Card has a category just for hotel/motel, whereas other cards would lump that together with travel. Then there’s the American Express Cobalt card that puts all food-related categories under “food and drinks.” Understanding the merchant categories with your cash rewards credit card is vital.

Remember that some merchants may not fall under certain categories that you would expect. For example, Walmart doesn’t count as a grocery store, unlike Walmart Supercentres, which do. Costco is another merchant that doesn’t count as a grocery store.

Since credit card companies don’t typically release their MCC lists, it may take some trial and error for you to figure out what category certain stores fall under. That said, it’s usually pretty straightforward.

When is credit card cash back paid out?

Every cash back credit card in Canada has different rules when it comes to payouts. Some payout in the form of a statement credit, while others payout based on a date. This date could be monthly or once a year. Redeeming cash may even require you to accumulate a minimum amount first. Before you sign up for a card, make sure you find out when you get paid, as it may not work for your timeline. Here’s when the best cash back cards in Canada pay out the money you’ve earned.

  • American Express –  On your September statement for cash back cards or as needed for cards that earn American Express Membership Rewards.
  • BMO  You can choose once you meet a certain amount. As little as $1 for a statement credit or $25 as automatic deposits to an eligible BMO account.
  • CIBC – Once you have at least $25 or every January statement.
  • Home Trust – Every January as a statement credit.
  • KOHO – Your cash back gets paid out immediately into your KOHO account.
  • RBC – Minimum of $10 cash back earned, and you must call in for the redemption. Alternatively, all cash back earned is paid out in January.
  • Scotiabank  Once per calendar year in November
  • Tangerine  Every month to your savings account or applied as a statement credit.
  • TD – All cash back is paid out in January. If you prefer the money earlier, you can redeem it anytime as long as you have earned at least $25 in cash back.

What additional benefits come with cash back credit cards?

The benefits you get with your cash back credit card will depend on the card that you have. Generally speaking, higher-tier cards come with better benefits. That said, there are some no fee and low fee cards that offer some excellent perks. Some benefits you should look for include:

  • Mobile device insurance – Cellphones and tablets purchased with a credit card with cell phone protection are covered from theft, loss, and damage for up to $1,000 – $1,500.
  • Roadside assistance – With roadside assistance plans, you can get emergency services if your car ever breaks down. Note that each plan differs, so see what each one offers before signing up for a credit card.
  • Travel insurance – A few cash back credit cards offer comprehensive travel insurance. If you want travel benefits, go for a travel rewards credit card.
  • No foreign transaction fees – Some cash back credit cards don’t charge the 2.5% fee that’s typically standard for purchases made in a currency that’s not Canadian dollars.
  • Extended warranty – Sometimes referred to as buyer’s assurance, extended warranty typically doubles your manufacturer’s warranty, up to one additional year.
  • Purchase protection – With purchase protection, items charged to your card are protected from loss, theft, and damage for 90 to 120 days.
  • Concierge service – Some cash back credit cards offer you 24/7 support via their concierge services that can assist you with various tasks including booking travel, making restaurant reservations, and even ordering and arranging delivery of gifts. 

How to pick a cash back credit card

The best cash back credit cards in Canada can vary quite a bit, so you need to establish some standards to help you narrow down your choices. Here are the things you should look out for when deciding which new card to add to your wallet.

Annual fee 

Many of the best cash back credit cards come with an annual fee but also come with a higher earn rate. This is fine if you spend a lot on your credit cards, but if you make limited purchases, go for a no fee credit card. Annual-fee cards also typically come with extra perks and generous sign-up bonuses.

Welcome offer

If you have some major purchases coming up, choose a card that has a good sign-up bonus, such as 10% cash back for the first three months. Note that these offers are always capped, so the maximum cash bonus you would earn is usually $200.

Accelerated earn rates

You’ll notice that just about every one of the best cash back credit cards in Canada gives you higher cash back for certain categories. E.g. groceries, gas, etc. You should look for a card that lines up with your spending. If you spend the most at grocery stores, you want a cash back card that will earn you more cash back there.

Base earn rate

The base earn rate is what you get for any purchases, not in a bonus category. This isn’t a big deal if most of your spending is on bonus categories, but if you do a lot of random spending, the base rate may benefit you. Alternatively, get a cash back credit card that has a flat earn rate for all categories

Additional benefits

Finally, you’ll want to see what additional benefits come with each card to see if they interest you. Travel insurance, mobile device insurance, no foreign transaction fees, and roadside assistance can be quite valuable.

How to maximize cash back credit cards

If you use your cash back cards responsibly by paying off your entire balance each month, there are a few tips you can use to increase the amount of cash back you earn. Remember that some of these tips may require you to track your spending, so make sure you have a system set up that makes things easier, like labelling your cards so you know how much cash back they earn.

Sign up for multiple cash back cards

Since every cash back card differs, some cards will have a higher earn rate than others. However, if you sign up for multiple cash back cards, you can maximize the earn rate on multiple categories. For example, the BMO CashBack® World Elite®* Mastercard®* gives you 5% cash back on groceries, 4% on transit purchases, 3% on gas and EV charging, and 2% on recurring bill payments. You could complement that with the PC Financial World Elite Mastercard (which has no annual fee) since it gives you 4.5% back in points at Shoppers Drug Mart. You could then add the Tangerine Money-Back credit card, which has no annual fee, and select restaurants, entertainment, and hotel/motel as your 2% categories. That’s a lot of categories where you’d be earning 2% or more in cash back.

Buy gift cards at grocery stores

Grocery stores typically have a higher earn rate with many cash back credit cards. You can use this to your advantage since many grocery stores sell gift cards to merchants that would typically be in a lower merchant category. For example, you could buy Costco, Amazon or Apple gift cards at a grocery store with your Scotiabank Momentum Visa Infinite Card since it gives you 4% cash back. By doing this, you would get the accelerated grocery earn rate instead of the base earn rate that those merchants would typically get.

Apply for cards that give you a valuable single benefit

Some of the best cash back credit cards in Canada may not appear good at face value, but a single benefit can make a huge difference. For example, the Triangle World Elite Mastercard comes with a free roadside assistance plan. That is worth over $100, and the card has no annual fee. Then there’s the Wealthsimple Cash Card with no foreign exchange fees on purchases or foreign ATM withdrawals. That saves you 2.5% each time, and there’s no annual fee.

Watch for welcome bonuses

Over the years, cash back credit cards have become quite competitive regarding the welcome bonus. Multiple cash back cards have offered 10% cash for three months. Some have even offered 15%. There’s just one catch. The promotional rate is usually capped at $200 to $300 in cash back earned. Of course, this only applies to new applicants, so one trick is to cash out all of the rewards you’ve earned and then cancel your card before the annual fee is due. You could then sign up for a new cash back card that waives the annual fee for the first year or has no annual fee.

Add supplementary users

Credit cards allow you to add supplementary users to your account. That means you could get your spouse and kids their own cards, which would still fall under your account. This is beneficial because all the cash back rewards earned go to the primary cardholder. With more people spending, you’ll be earning more cash back.

Product switch

A few credit card providers allow you to switch your credit card to another product. This can be beneficial if you want to maximize your welcome bonus without paying an annual fee. This works because many credit cards waive the annual fee for the first year. If you switch cards before your anniversary date is up, you could potentially get another welcome bonus with a different card, without having to get a credit check done. For example, you could go from the TD Cash Back Visa Infinite card to the TD Aeroplan Visa Infinite card.

How to apply for a cash back card?

Now that you know the ins and outs of the best cash back credit cards in Canada, it’s time to pick up a card to start earning rewards. Applying for a cash back card is easy, just follow these steps:

  1. Browse the above list – I’ve picked out the top cards, so there’s less work for you.
  2. Click apply now – You’ll be taken to another page where you can verify that you qualify for the card you’re interested in,
  3. Fill out the application – You’ll be asked for personal information to verify your identity
  4. Wait for your card to arrive – Some applications get instantly approved, while others may require waiting up to 10 business days for a decision.
  5. Activate your card – When it arrives, activate it by calling in or using the mobile app.
  6. Start spending – If you’ve signed up for a cash back credit card with a welcome bonus, start spending to max out your offer.

Are cash back credit cards worth it?

If you spend a lot on your credit card then yes, cash back credit cards might be worth it. That said, other types of rewards cards might be more lucrative depending on your lifestyle, such as travel credit cards. 

FAQ

What’s the best cash back credit card in Canada?

The best credit cards for cash back will depend on your goals. If you are looking for a no-fee card, then the Tangerine Money-Back Card is the obvious choice. If you’re looking for a high earn rate, it’s worth looking at the American Express Cobalt Card. Consider your spending habits- wherever you spend the most is likely where you can earn the most. Once you know how you spend your money, this list can help you choose the best cash back credit card. 

What credit score do I need for a cash back credit card?

Generally, rewards cards tend to have higher requirements for credit scores than a credit card with no rewards. When it comes to cash back credit cards, it depends on the card. You should aim for a good credit score (around 700) to apply. The higher end cash back credit cards with all the perks and benefits might require a higher credit score of around 740+. 

Are there cash back limits?

Many cash-back credit cards have spending caps that you need to be mindful of. This varies by card, but typically, the spending caps are on the accelerated categories, not the base rate. That said, you also need to be mindful of when the limits reset. Some have monthly limits, while others have annual limits. 

What are the pros and cons of cash back credit cards in Canada

The advantages of a cash back card may seem obvious, but it’s not that simple. Cash back cards can have drawbacks, especially compared to travel rewards credit cards. Always consider the pros and cons before applying for a credit card. 

Cash back credit card pros

  • Easy to understand – Cash back rewards are simple. There’s no need to worry about redemption charts or blackout dates like you might with travel rewards.
  • High earn rates – Cash back cards have become quite competitive, so the number of accelerated earn rate categories has grown.
  • Easy to cash out – Most financial institutions now allow you to redeem your cash back once you’ve earned at least $25 instead of waiting for it once a year.

Cash back credit card cons

  • Not as valuable – While cash back is simple, travel rewards – such as Aeroplan – are often more valuable.
  • Limited benefits – Travel rewards cards offer more benefits such as airport lounge access, free checked bags, travel insurance, priority airport services, and more.
  • Welcome bonuses are average – Even though some credit cards have good welcome bonuses – such as 10% cash back – travel rewards cards typically have even better offers.

Are Cash back or travel rewards better?

Travel and cash back are the two most popular credit card rewards. Travel rewards can be very lucrative as the value of your points can be quite valuable depending on what you’re redeeming for.

Cash back may not give you as big of a return, but it’s easy to understand. With cash back, there’s no need to worry about blackout dates, seat availability or taxes since you get paid out in cash. Which one you choose is a personal decision, but try to stick to one.

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About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi

19 Comments

  1. […] Overall the difference between all three cards are pretty minor so you really can’t go wrong with any of them. Once you’ve cleared your debt and have your spending under control, you can maximize your return by applying for one of the best travel credit cards or one of the best cash back credit cards. […]

  2. […] dollars. That’s pretty impressive for a no fee card which is why it’s also one of the best cash back cards in Canada. Read my review of the Rogers World Elite Mastercard for my full thoughts on the […]

  3. Nitish on April 24, 2019 at 1:30 PM

    How come the MBNA world Elite isn’t on there? Is it because they decreased the benefits recently?

    • Barry Choi on April 24, 2019 at 2:15 PM

      You got it!

      • Nitish on April 24, 2019 at 2:18 PM

        Makes sense. Thanks for the article! I’m leaning towards the Tangerine but tempted by momentum. If Costco accepted visa, momentum would be a no brainer for me.

        • Barry Choi on April 24, 2019 at 2:25 PM

          The Tangerine card is great as a no fee card. Both the Meridian and Momentum cards have great promos right now as well some good travel insurance.

  4. […] that it’s great for people who use Amazon Prime and shop at Whole Foods a lot, but compared to the best cash back credit cards in Canada and the best travel credit cards in Canada, you may be a little disappointed. Read my Amazon.ca […]

  5. Alex on July 10, 2019 at 10:48 PM

    Just signed up love this concept for getting foreign cash at a good rate upon arrival. Realistically though, there aren’t any ATM’s that won’t charge a fee on their end to withdraw cash from a prepaid MasterCard, right? Is that the only way to get money off this card?

    • Barry Choi on July 11, 2019 at 7:42 AM

      Alex,

      There are a few ATM providers that don’t charge fees. In the past, I used HSBC in Asia and Europe without fees.

  6. Tim on July 31, 2019 at 10:33 AM

    So the Meridian one has this disclosure:

    Earn 4% on gas and grocery purchases. (Applies to first $25,000 in purchases then 1% for all other purchases.)
    Earn 2% on pharmacy purchases and utility bill payments. (Applies to first $25,000 in purchases then 1% for all other purchases.)

    Does that mean after spending a total of $25K in each category above, it goes back to 1% cashback for a lifetime?

    • Barry Choi on July 31, 2019 at 3:08 PM

      Tim

      I haven’t looked at the fine print but the $25K cap applies for each category so 4% $25K on gas, $25K on grocery etc. If you spend over that amount, the cash back goes down to 1%. This usually lasts per calendar year so you would get the increased cash back on Jan. 1st.

      Again, I haven’t looked at the fine print, but that’s what it usually means.

      • Timothy Trisnadhama on July 31, 2019 at 4:31 PM

        Gotcha. Thanks

  7. Jared Riley on April 27, 2020 at 11:35 AM

    As of June 2, 2020, Rogers is reducing the rewards on the World Elite to 1.5% across the board. Foreign transactions are dropping to 3%.

    It still might be among the best if you shop a lot at Costco and you don’t want to bother with categories. Otherwise it doesn’t stand out as much as it used to.

    • Barry Choi on April 27, 2020 at 11:43 AM

      Jared,

      Yes the new changes are annoying. It’s just an okay card moving forward.

      I personally prefer to use the WestJet RBC World Elite Mastercard at Costco. It also has a 1.5% return rate.

  8. Rick on November 3, 2020 at 8:50 AM

    Any reason you dont have the TD Cash Back Visa Infinite?

    • Barry Choi on November 3, 2020 at 9:24 AM

      No real reason. I just think the other cards on my list are better for specific instances. That said, the TD Cash Back Visa Infinite card does come with free roadside assistance and that alone makes it worthwhile.

      • Rick on November 3, 2020 at 9:26 AM

        Sounds good, thanks. And yes, I agree RSA is a nice perk to have for sure 😉

  9. Rafs on July 7, 2022 at 8:38 PM

    Hello Barry,

    Need your guidance.
    In Canada, how many personal credit cards does AMEX allow?

    Thank you,

    • Barry Choi on July 7, 2022 at 8:56 PM

      Rafs,

      I’m not 100% sure, but I believe it’s 8. 4 charge and 4 standard cards.

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