Once upon a time, getting a credit card was a fairly straightforward process: You walked into the local branch of the bank where your savings account was and filled in an application. If they were affiliated with Visa – and you qualified – they issued you a Visa card. If your bank was affiliated with MasterCard, you got a MasterCard.

Consumer is King

But since the explosion of online banking, along with cards issued by everyone from gas stations to grocery stores, consumers have their pick of the credit card crop. Here, we compare the pros and cons of the low-interest, travel rewards, and cash back cards issued by TD Bank and RBC - head-to-head.

In Your Best Interest

For a $25 annual fee, TD’s low interest card, the Emerald Visa, comes with an interest rate based on the bank’s prime rate, plus a range of 1.75% to 9.75%, depending on your credit rating. But even on the high end, it still edges out RBC’s $20 Low Interest Visa with a fixed 11.99 percent rate. Of course, as we often remind you here, you really shouldn’t be carrying a balance on your credit card. If circumstances do force you to – and you don’t have line of credit room available – you might want to look into some of the even lower rates available for six months to three years here.

Take Off With Travel Rewards

TD offers three travel cards, the Classic, Platinum and First Class, with annual fees ranging from $19 to $120. Instead of an affiliation with a specific airline, each card earns you TD Points – two per dollar spent on the Classic, three per dollar on the higher-tier two. Each point is worth half-a-cent ($0.005) and are redeemable in $50 increments (or 10,000 TD Points) on travel purchased with the card. In addition to their own cards offering RBC Rewards points (redeemable for travel with any airline), RBC also has travel cards directly affiliated with WestJet, British Airways, and Cathay Pacific. The WestJet RBC World MasterCard, for one, gives cardholders who frequent the Canadian airline 1.5% in WestJet dollars for every dollar spent on the card. The card also includes 15-day out-of-province or country medical insurance, travel interruption insurance, and burglary insurance for hotel and motel rooms.

Cashing In On Day-To-Day Expenses

“Cash back” is a bit of a misnomer, since the rewards are doled out in the form of credit on your bill, but it is still nice to get money for simply going about your business. The TD Rebate Rewards Visa is a no-fee card that offers 0.5% cash-back on your first $3,000 in annual purchases (so up to $15) and 1% on all purchases up to $25,000 after that (for a total maximum reward of $235). RBC offers both a Visa and a MasterCard cash-back option. Their cash back Visa provides 1% back on all annual purchases from the first dollar through $25,000, but the $19 annual fee negates the slightly higher earnings on the first $3K in spending.

Our Champ: RBC

The best of the three is RBC’s Cash Back MasterCard, which provides a 1% return on most purchases, and 2% up to $6,000 in annual purchases at a wide range of national and regional grocery stores (the list includes some 75 chains, including Loblaws, Metro, and Walmart). Max out at $25,000 and you’ll get a $310 credit on your bill.

Allan Britnell

Toronto-based freelancer Allan Britnell is an award-winning writer with nearly 20 years’ experience. He covers a diverse range of topics, including DIY and professional home renovation projects, nature and the environment, small business, personal finance, and family and health issues. He is also the managing editor of Renovation Contractor, the publication written for small- and medium-sized contracting and custom home building companies. He lives in Toronto with his wife, two daughters, and their dog, Oscar.

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