Figuring out the best cash back credit cards in Canada should be an easy process, but it can be complicated. Every credit card has different earn rates for specific categories, so you need to go through all the rewards credit cards to narrow down your choices. To further complicate things, many of the best of lists out there are a bit biased and have too much information, so it leaves you more confused than when you started.
After much feedback from my readers, I’ve come up with an updated list of the best cash back credit cards in Canada. Instead of focusing on specific spending categories, I’ve broadened the list so it’ll quickly help you decide which card is best for you. Admittedly, I also have some bias, but I feel these selections are the best for average Canadians.
|Credit card||Best cash back card for|
|BMO CashBack® World Elite®* Mastercard®*||Overall spending|
|PC Financial World Elite Mastercard||Groceries|
|Tangerine Money-Back Card||Flexibility|
|American Express Cobalt Card||Travel and rewards|
|American Express SimplyCash Card||No annual fee|
|Wealthsimple Cash Card||No foreign transaction fees|
|Scotiabank Momentum Visa Infinite Card||Insurance|
|Triangle World Elite Mastercard||Roadside assistance|
Best cashback card for overall spending
As mentioned, you want to pick a credit card that gives you the highest earn rates on your regular spending habits. Who cares about streaming services, pharmacy, and recurring payments when you mostly charge groceries, gas and daily transit to your card. Overall, there’s one card that stands out.
BMO CashBack® World Elite®* Mastercard®*
- $120 Annual fee – First year free*
- 10% cash back on all purchases for three months (up to $200)
- 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
The BMO CashBack® World Elite®* Mastercard®* often gets overlooked as one of the best cash back credit cards in Canada but it recently had some major changes for the better. The earn rate is now 5% on groceries, 4% on transit, 3% on gas, 2% on recurring bills, and 1% on all other everyday purchases.
There is a catch. The 5% cash back on groceries only applies to the first $500 in purchases for each statement. For transportation, your 4% cash back is capped on the first $400. Once you reach the caps, you earn the base earn rate of 1%. If you typically spend more than that, the American Express Cobalt Card or Scotiabank Momentum Visa Infinite card would likely be better choices.
You do get some great additional benefits with this card including lounge access (no passes), roadside assistance, concierge service, travel insurance, and extended warranty.
Best cash back card for groceries
With grocery prices on the rise, many people are looking to save money where they can. Focusing your cash back on grocery purchases can be an effective way to save money. Admittedly, the best cash back card for groceries will depend on where you shop, but I think the PC Financial Mastercards are a great choice if you shop at Loblaws’ owned stores.
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
Let’s be clear, the PC Financial World Elite Mastercard doesn’t have the highest earn rate for groceries. It caps at 30 PC Optimum points per $1 spent at Loblaws’ owned stores. That works out to 3% in cash back. However, the fact that you’re earning PC Optimum points is where the real value comes in.
With PC Optimum, you can redeem your points for groceries and merchandise. 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.
Best cash back card for flexibility
The most annoying thing about the best cash back credit cards in Canada is that they all have different earn rates. Rarely do you find a card that perfectly lines up with your spending so you can maximize your return. That said, there’s actually a card that lets you choose your bonus categories.
Tangerine Money-Back Credit Card
- No annual fee
- 15% cash back up to $1,000 in spending ($150 cash back) for the first 12 months
- 2% cash back on up to 3 categories
- 0.5% cash back on all other purchases
The Tangerine Money-Back Card allows you to select up to three categories where you can earn 2% cash back. You get two categories, to begin with, and you earn a third category if you set your cash back to automatically deposit into your Tangerine savings 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 the categories you choose.
Admittedly, 2% isn’t as high as some other cards on this list, but it’s also higher than the base earn rate of every other card. Some people will use this card as a complement to 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.
It’s worth mentioning that there’s a premium version of this card in the Tangerine World Mastercard. It also has no annual fee and comes with some extra insurance. That said, the minimum income requirement for the card is higher.
Best cash back card for travel and rewards
It may seem odd to feature a cash back card that earns you points, but hear me out. American Express recently changed its membership rewards program. It now takes 1,000 points for $10 in statement credits or travel rewards. What that means is that all American Express cards are just as good for cash back, but there’s one that stands out.
American Express Cobalt Card
- $12.99 Monthly fee ($155.88 yearly)
- 2,500 monthly Membership Rewards points after charging $500 in purchases each month for a year (30,000 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
The American Express Cobalt Card gives you ultimate flexibility. It doesn’t matter if you’re redeeming your points for travel or a statement credit, your points are worth the same. Since you get 5 points per $1 spent on eats and drinks, that effectively gives you a 5% cash back return. Best of all, you can redeem your points for a statement credit pretty much whenever you want through your online account.
If you decided to use your points you have a lot of flexibility. You can use the American Express travel portal or you can redeem points on any travel purchase you make. Additionally, you can transfer your points to Aeroplan, Marriott Bonvoy, and other travel partners.
Best cash back card with no annual fee
There are a lot of cash back cards with no annual fee which is great for people who don’t tend to charge a lot to their cards or don’t like paying to have a credit card. Although there are some cards that offer a higher earn rate, I recommend the SimplyCash Card from American Express since you’ll earn the same flat-rate cash back on all purchases.
SimplyCash Card from American Express
- No annual fee
- 4% cash back on purchases for the first 6 months (up to $200 cash back)
- 1.25% cash back on purchases after the first 6 months
- Buyer’s assurance
- Purchase protection
The American Express SimplyCash Card consistently ranks as one the best cash back credit cards in Canada since you’ll earn a straight flat rate of 1.25% cash back on all purchases. While that may not sound like a lot, it’s pretty good for a no fee card. I like how you earn the same cash back rate no matter what. There’s no need to worry about having multiple cards to maximize your return. There is a welcome bonus of 4% cash back on all purchases for the first 6 months (capped at $200 in cash back). Additionally, you get purchase protection and buyer’s assurance.
There is one downside. As an American Express Card, it’s not accepted at every merchant. If you want a no fee card that’s accepted at most retailers, consider the Tangerine Money-Back Card instead. On a positive note, you do get Amex perks with this card such American Express Invites, dining series, and pre-sale tickets.
Best cash back card without foreign transaction fees
A lot of people don’t realize that when you make a purchase in any currency that’s not Canadian dollars, you’re charged a fee of 2.5%. Fortunately, you can get that fee waived if you have one of the best no foreign transaction fee credit cards in Canada. My top pick is a bit controversial, but let me explain why I like it.
Wealthsimple Cash Card
- No annual fee
- 1% cash back on all purchases
- No foreign transaction fees on purchases
- No foreign transaction fees on ATM Withdrawals
- CDIC insurance protection
The Wealthsimple Cash Card is easily the best cash back credit card without foreign transaction fees since you earn a straight 1% cash back on all eligible purchases. This includes foreign currency purchases. In addition to having no foreign exchange fees on purchases, cardholders 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.
Best prepaid cash back card
Prepaid credit cards have evolved over the years. Traditionally, people would only get them if they didn’t qualify for a traditional credit card. However, these days they come packed with benefits and are tied to an app that gives you insights into your spending. If you want to be better with your money while earning cash back, a prepaid card might make sense.
KOHO is a prepaid credit card that has no annual fees and gives you 0.5% 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 love this card 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 automatically save. Additionally, you get real-time spending insights which can be helpful if you’re trying to balance your budget.
Best cash back card for insurance
Insurance coverage is often overlooked, but there are quite a few users who swear by it. The idea with insurance is that you’ll be glad you have it if you ever need to make a claim. Although most cash back credit cards don’t come with much insurance, there’s one card that’s a winner.
Scotiabank 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% caash back per $1 spent on groceries, recurring bills, and subscription purchases
- Earn 2% cash back per $1 spent 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
The Scotia Momentum Visa Infinite Card is an extremely popular rewards card since it’s one of the best Scotiabank credit cards in Canada. 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 things such as 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. The annual fee is typically waived for the first year, and this card often has a nice welcome bonus.
Best cashback card for roadside assistance
One often overlooked benefit is roadside assistance. With this service, you can help if you ever run into car issues at home or on the road. This type of service will typically cost you about $100 – $150 a year, but with the right card, you can get it for free.
Triangle 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
- No fee, no interest financing available
Without a doubt, the Triangle World Elite Mastercard is the best cash back rewards card for roadside assistance. That’s because Canadian Tire’s gold roadside assistance plan comes with 24/7 service, 5 service calls a year, tows up to 200 kilometres, and more.
Keep in mind that the cash back earned on this card can only be used at participating stores such as Canadian Tire, Party City, Sport Chek. While the ability to use your cash back earned is limited, this is a no fee cashback card. That means you could sign up just for the free roadside assistance.
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 ard. 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 of them 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 speaking, you want to choose a cash back credit card that lines up 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 earn rates work?
Every cash back card has different earn 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 obviously appealing since you can earn more cash back on select categories. That said, every credit card provider will typically cap the accelerated earn 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 earn rate. There’s one exception to this rule in the Tangerine Money-Back Card, where 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?
Every retailer is assigned a merchant category code (MCC) by Visa, Mastercard, and American Express. 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 let’s say you bought a Costco gift card at Metro, you’d get the accelerated grocery earn rate for that purchase.
- 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 flights, hotels, theme park tickets, cruises, and car rentals, typically fall under travel.
- Gas – Any time you make a purchase at a gas station, it would fall under the gas category. This includes any purchase in
- Transportation – Parking, public transit, and EV charging would be types of transportation merchants.
- Entertainment – This 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 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 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.
It’s really important to see what merchants are covered in any 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/model, 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.”
Keep in mind that some merchants may not fall under certain categories that you would expect. For example, Walmart doesn’t count as a grocery store, whereas Walmart Supercentres 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. Some of these credit cards also have a minimum requirement before they’ll cash you out. 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 good perks. Some benefits you should look for include the following:
- Mobile device insurance – Cellphones and tablets purchased with a credit card with mobile device insurance 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 is different, 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. That said, 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 any 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.
Pros and cons of a cash back credit card
The advantages of a cash back card may seem obvious, but it’s not that simple. Cash back cards can have drawbacks, especially when 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.
Cash back or travel rewards?
The two most popular types of credit card rewards are travel and cash back. 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.
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.
Many of the best cash back credit cards come with an annual fee, but they’ll also come with a higher earn rate. This is fine if you do a lot of spending on your credit cards, but if you make limited purchases, go for a no fee credit card.
If you have some major purchases coming up, choose a card that has a good welcome offer, such as 10% cash back for the first three months. Note that these offers are always capped, so the maximum cash back 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 extra cash back for certain categories. E.g. groceries, gas, etc. You should look for a card that lines up with your spending. If you do the most spending at grocery stores, then 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
Finally, you’ll want to see what additional benefits come with each card to see if they’re of any interest to you. Things such as travel insurance, mobile device insurance, no foreign transaction fees, and roadside assistance can be quite valuable.
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 for you to pick up a card so you can start earning rewards. Applying for a cash back card is easy, just follow these steps:
- Browse the above list – I’ve picked out the top cards, so there’s less work for you.
- Click apply now – You’ll be taken to another page where you can verify that you qualify for the card you’re interested in,
- Fill out the application – You’ll be asked for personal information to verify your identity
- Wait for your card to arrive – Some applications get instantly approved, while others may require you to wait up to 10 business days for a decision.
- Activate your card – When your card arrives, activate it by calling in or using the mobile app.
- Start spending – If you’ve signed up for a cash back credit card with a welcome bonus, be sure you start spending to max out your offer.
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 is different, 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 also 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 has a value of more than $100, and the card has no annual fee. Then there’s the Wealthsimple Cash Card which has 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 when it comes to 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 of the cash back rewards earned go to the primary cardholder. With more people spending, you’ll be earning more cash back.
A few credit card providers allow you to switch your credit card to another product. This can be beneficial if you’re looking to maximize your welcome bonus without paying an annual fee. The reason this works is that 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.
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