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2021's Best Balance Transfer Credit Cards for Canadians

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What’s a balance transfer credit card?

When you have existing credit card debt and you want to take advantage of a lower interest rate to easily pay it off, you can transfer the balance to a balance transfer credit card. A balance transfer credit card allows you to easily transfer your existing credit card balance and take advantage of a low interest rate. Some promotional interest rates can be as low as 0%. These low interest rate offers usually last for a limited period of time (e.g. 180 days or 1 year) and are designed to help you to easily pay off your existing credit debt. Many Canadians struggle to pay off their credit card debt due to high interest charges, not knowing that they can take advantage of balance transfer credit cards.

If you owe money on multiple credit cards, a balance transfer credit card can allow you to consolidate all your balances onto one card. Instead of managing several card bills payments each month, you’ll only have one. This is one a major selling point to balance transfer cards.

The Best of Finance Winners for 2021: Best Balance Transfer Credit Card

It is time to pay off your high-interest credit card debt; carrying a balance only costs you money.

Cardholders with outstanding debt can typically transfer their existing balance to another card with a balance transfer promotion to take advantage of lower interest rates.

Some introductory rates can be as low as 0% for a set time, anywhere from a few months to a year. Conditions apply, however. New purchases typically incur standard interest rates, and misuse, like missing payments, may forfeit the offer.

Cardholders must typically pay a balance transfer fee of around 1% for the service. However, the cost is generally less than the interest charges on a standard credit card with a 19.99% interest rate. If used responsibly, cardholders can focus on payments and reduce their debt faster.

We compared balance transfer rates in Canada using our Best of Finance methodology and ranked the cards that provided the most savings.

  First year value Annual fee Interest rate (balance transfer)
$353 $29 (First year waived) 13.99%
$275 $20 (First year waived) 12.99%
$181 $39 8.99%

Winner: CIBC Select Visa* Card

The CIBC Select Visa* Card offers one of the best promotional balance transfer rates on the market. New cardholders can get a 0% introductory interest rate on balance transfers for up to 10 months with a 1% transfer fee. This special offer can help cardholders pay down their balance quicker and avoid spending as much on interest charges.

Based on our Best of Finance methodology, the average Canadian would spend around $353 less in interest charges on a $2,000 balance when compared to a standard credit card with a 19.99% interest rate.

Runners-up: Best Balance Transfer Credit Cards

BMO Preferred Rate Mastercard*

The BMO Preferred Rate Mastercard* offers cardholders a 3.99% introductory interest rate on balance transfers for nine months with a 1% transfer fee. After the promotion, cardholders can access BMO’s lowest interest rate on purchases and balance transfers, at 12.99%.

Based on our Best of Finance methodology, the average Canadian would save around $275 in interest charges in the first year.

Annual fee:

$20

Limited time offer/bonus:

  • Get a 3.99% introductory interest rate on balance transfers for nine months. A 1% balance transfer fee does apply. Plus, pay no annual fee for the first year.

Offer expiry date: October 31, 2021

Interest rates: 

  • Interest rate (purchases): 12.99%
  • Interest rate (cash advances): 12.99%
  • Interest rate (balance transfer): 12.99%

True Line® Gold Mastercard®

Cardholders of the True Line® Gold Mastercard® can access a standard annual interest rate of 8.99% on balance transfers and purchases. Although there is no balance transfer promotion on this card, it offers one of the best rates all year long for a low annual fee of $39.

According to our Best of Finance methodology, the average Canadian would save around $181 in interest charges in the first year.

Annual fee:

$39

Limited time offer/bonus:

There is no welcome bonus currently.

Offer expiry date: N/A

Interest rates: 

  • Interest rate (purchases): 8.99%
  • Interest rate (cash advances): 24.99%
  • Interest rate (balance transfer): 8.99%

Frequently asked questions about balance transfer credit cards

Interested in getting a balance transfer credit card to help you pay off your existing debt? Here’s what you need to know.

What do I need to consider before getting a balance transfer credit card?

While comparing different balance transfer credit cards, it’s important to look at all the features the credit card comes with. This is because transferring your debt from one card to another should only be done when it helps you pay off your debts at a faster pace.

Remember, the interest you pay on a higher interest card is never worth the extra points – to get the most of a great rewards card use a Balance Transfer card to pay off your balance so you can get back to collecting all points.

Here are the features you should consider before picking a balance transfer credit card:

  • Balance transfer fee: Most credit card lenders charge a balance transfer fee, which can range from 1-5% of the amount you transfer over. For example, if you choose to transfer a balance of $4,500 and the transfer fee is 3%, you will be charged $135 for the transfer. If the transfer fee and interest rate is too high, the switch may not be financially beneficial to you.
  • Interest rates: While comparing different balance transfer credit cards, carefully look at the interest rates to determine which one is the best for your existing debt. Pay attention to the term of the promotional rates. See if the duration of the promotion is long enough for you to pay off all or a majority of your credit balance. Some balance transfer credit cards can offer you a very low interest rate for a limited period of time. Once that duration is over, the interest rate changes and you’ll be charged the standard interest rate the card comes with. For example, the MBNA True Line offers you a promotional interest rate of 0% for 10 months (+3% transfer fee) and 12.99% afterwards.
  • Terms and conditions: Pay attention to the terms and conditions that accompany the balance transfer credit card. Most balance transfer credit cards are designed to help you pay off existing debt, rather than to make new purchases. New purchases may be subject to a higher interest rate, such as, 12.99% or more. For example, the Scotiabank Value Visa gives you an interest rate of 0.99% for balance transfers and 12.99% for any new purchases and cash advances.

Will a balance transfer credit card affect my credit card score?

Whenever you apply for a new credit card, the lender checks your credit history and credit score. This results in a hard check that may cause you to temporarily lose a couple of credit points. This is exactly why you shouldn’t apply for several credit cards at once. Carefully compare the best balance transfer credit cards to choose the best one for you and then apply for that one only. As you begin to make regular debt repayments through your balance transfer card, you credit score should start to increase slowly and steadily.

Also, you can check the eligibility criteria on RATESDOTCA to help get a better idea on if you’re eligible for a certain credit card.

What are the different types of debt I can transfer onto a balance transfer credit card?

Balance transfer credit cards are most commonly used for the repayment of credit card debt, but some credit card lenders may allow you to transfer your loans or lines of credit onto the card. However, it’s important to note that these credit card lenders don’t allow you to transfer debts among their own products. For example, you cannot transfer a Scotiabank loan to a Scotiabank balance transfer credit card. Also, while transferring other types of debt onto your new balance transfer credit card, be wary of the transfer fee. Transfer fees are usually expressed as a percentage of the balance that is being transferred, so a high transfer amount may result in a very high transfer fee.

What should I do when my balance transfer promotion ends?

If you’re worried that your balance transfer promotion is going to end soon and you still have a considerable amount of debt to repay, you can consider transferring your debt to another credit card. Sometimes, this becomes a risky move as credit card lenders can decline your application. The best strategy is to maximize your first balance transfer promotion and pay off as much of your debt as you can during the period.

RATESDOTCA may receive compensation when you click on links to those products or services. however, our content and calculations are objective and free from bias. The opinions expressed are purely those of RATESDOTCA; thus, partners are not responsible for any editorials or reviews that may appear. For current term and conditions on any advertiser or partner’s product, please visit their website.

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