Reward Credit Cards: Guide to the Best Options

Reward credit cards are great options for those looking for a beneficial option without an annual fee and with simple and flexible management. 

However, before choosing one, it is important to consider the high-interest rates and the reward structure when making the decision.

Below, we list some cards that may be a suitable choice for your spending profile. Have this doubt? Check out this comprehensive guide from We Recommend!

1- American Express Cobalt

The American Express Cobalt card is one of the most popular offered by American Express in Canada. It is designed to attract young professionals and millennials, offering a variety of benefits that align with this generation’s spending habits.

Focusing on rewards and experiences, the Cobalt stands out for its flexible and generous points program. It offers 5 points per dollar spent on restaurants, bars, supermarkets, and food delivery services.

In addition, it offers 3 points per dollar spent on streaming services, 2 points per dollar spent on transportation, including airfare, hotels, taxis, and rideshare services, and 1 point per dollar spent on all other purchases.

The Cobalt has an annual fee charged monthly, making payment easier. The fee is $12.99 CAD per month, totaling $155.88 CAD per year.

New card users can earn up to 15,000 Membership Rewards points in the first 12 months.

Comprehensive travel insurance, including travel accident insurance, trip interruption insurance, and baggage insurance.

Points can be redeemed in various ways, including statement credits, travel, merchandise, and transfers to airline and hotel loyalty programs.

Pros

• High points accumulation rate: Spending categories with higher points accumulation (restaurants, supermarkets, and transportation) are common in daily life, allowing users to maximize their rewards.
• Attractive welcome bonus: The possibility of earning up to 15,000 points in the first year is a significant incentive for new users.
• Travel benefits: Travel insurance and access to exclusive offers make the Cobalt an excellent choice for frequent travelers.
• Flexibility in redeeming points: The wide range of options for redeeming points allows users to choose the best way to use their rewards, whether for travel, statement credits, or merchandise.
• Monthly annual fee charge: The annual fee divided into monthly payments can be more manageable for many users, reducing the immediate financial impact.

Cons

• Annual fee: Although divided into monthly payments, the annual fee of $155.88 CAD can be high compared to other credit cards on the market.
• Limited acceptance: Like all American Express cards, the Cobalt may not be accepted at all establishments, especially compared to Visa and Mastercard.
• Foreign transaction fees: The card charges a 2.5% fee on transactions made in foreign currencies, which can be a limiting factor for those who travel frequently outside of Canada.
• Spending requirements for the welcome bonus: To take full advantage of the welcome bonus, users need to spend at least $500 CAD per month for 12 months, which may not be feasible for everyone.
• Benefits specific to Canada: Some of the benefits and rewards of the American Express Cobalt are specific to the Canadian market, limiting its appeal to users outside of Canada.

2- BMO Cashback Mastercard

The BMO Cashback Mastercard is a credit card offered by the Bank of Montreal (BMO) that stands out for its cashback rewards program.

This card is designed for consumers who want to maximize the return on their daily purchases without the need to pay an annual fee.

The BMO Cashback Mastercard offers up to 3% cashback on grocery purchases, 1% on recurring bill payments (such as subscriptions and services), and 0.5% on all other purchases.

It has no annual fee, making it an accessible option for many consumers. The standard interest rate is 20.99% on purchases and 22.99% on cash advances.

In addition, the card includes additional benefits such as purchase insurance, extended warranty, and access to exclusive offers through the Mastercard Priceless Cities program. 

The application for the card can be done online and is accessible to individuals with different levels of credit history.

Pros

• No annual fee: The BMO Cashback Mastercard does not charge an annual fee, allowing cardholders to save money throughout the year, especially compared to other cards that offer similar rewards but with annual fees.
• Competitive Cashback Program: Offers up to 3% cashback on grocery purchases, one of the highest rates on the market for this type of spending. Also offers 1% on recurring bill payments and 0.5% on all other purchases.
• Shopping Benefits: The card includes purchase insurance and extended warranty, which are valuable benefits to protect purchases against damage or theft and to extend the manufacturer’s warranty.
• Exclusive Offers: Access to the Mastercard Priceless Cities program, which offers exclusive experiences and offers in various cities around the world.
• Easy Application: The application for the card is simple and can be done online, making it accessible to a wide range of consumers.

Cons

• High-Interest Rates: The card’s interest rates are relatively high (19.99% on purchases and 22.99% on cash advances). For those who do not pay the full balance monthly, interest costs can quickly accumulate.
• Cashback Limitations: The 0.5% cashback on all other purchases is lower compared to other rewards cards that may offer higher rates in general spending categories.
• Credit Requirements: Although the card is available to a wide range of consumers, those with poor credit history may not be approved, limiting access to the card.
• Benefit Limitations: While it offers some benefits, it does not include some more premium advantages that other cards may offer, such as airport lounge access, comprehensive travel insurance, or flexible points programs.

3- Scotiabank Gold American Express

The Scotiabank Gold American Express card is one of the premium credit cards offered by Scotiabank, one of the largest banks in Canada.

This card is ideal for people seeking significant benefits in travel rewards, cashback, and exclusive advantages.

It offers a robust rewards program, comprehensive insurance protection, and additional benefits that cater to both frequent travelers and everyday consumers.

You earn 6 points per dollar spent at the card’s partner merchants, 5 points per dollar spent on groceries, restaurants, and 3 points per dollar on travel.

The accumulated points can be redeemed for travel, products, gift cards, and more. This card does not charge foreign transaction fees, which is a great advantage for international travelers.

Its travel insurance is comprehensive, including coverage for trip cancellation and interruption, emergency health insurance during these trips, and car rental insurance.

Purchase protection and extended warranty on items purchased with the card, plus 24-hour customer service and global emergency assistance.

Pros

• Generous rewards: High point accumulation rates in popular spending categories, allowing points to accumulate quickly.
• No foreign transaction fees: Ideal for international travelers, saving money on purchases made outside of Canada.
• Comprehensive insurance: A wide range of travel and purchase insurance coverages offers additional peace of mind.
• Exclusive benefits: Access to unique events and experiences through the American Express Invites program.
• Flexibility in redeeming points: Points can be used for a variety of redemption options, including travel and products.
• Global acceptance: The card is widely accepted due to the American Express network.

Cons

• High annual fee: The annual fee can be considered high compared to other rewards cards, which may not be justified for those who do not take advantage of all the benefits.
• Minimum income requirements: It may require a high minimum income for eligibility, restricting access to some consumers.
• Limited acceptance in some places: Although global acceptance is broad, some establishments may not accept American Express, especially outside of major cities.
• High-interest rates: Like many credit cards, interest rates on unpaid balances can be quite high, which is a factor to consider if you do not pay the balance in full each month.
• Dependence on points: The value of the points can vary depending on how they are redeemed, which can be somewhat complex for some users.

4- Tangerine World Mastercard

The Tangerine World Mastercard is a popular credit card in Canada, offered by the digital bank Tangerine. This card is designed to provide various benefits to its users, especially those looking to maximize returns on their everyday purchases. 

Tangerine World Mastercard holders can earn 2% cashback in up to three categories of their choice and 0.5% on all other purchases. The 2% cashback categories include groceries, restaurants, public transportation, entertainment, pharmacies, gas, and others. 

This card includes car rental insurance, extended warranty insurance, and purchase insurance, with discounts on travel and exclusive experiences. 

Additionally, it offers access to airport lounges worldwide through LoungeKey. The Tangerine World Mastercard has no annual fee, making it a more accessible option for many consumers, and is compatible with various digital wallets.

Such as Apple Pay, Google Pay, and Samsung Pay.

Pros

• Excellent cashback program: The 2% cashback in up to three chosen categories allows users to maximize their rewards in areas where they spend the most.
• Flexibility in category selection: The ability to choose and change cashback categories offers flexibility that adapts to changing spending patterns.
• No annual fee: The absence of an annual fee makes this card an economical choice for obtaining benefits and rewards.
• Travel and insurance benefits: The inclusion of insurance and travel benefits adds value, especially for frequent travelers.
• Ease of use with digital wallets: Compatibility with digital wallets facilitates mobile payments, providing additional convenience to users.

Cons

• Limitations on cashback categories: The 2% cashback is limited to only two categories, which may not be sufficient for some consumers with varied spending.
• Interest rate: Interest rates on outstanding balances can be high, as is common with most credit cards. It is important to pay the total balance monthly to avoid interest.
• Income requirements: There may be income requirements to qualify for the card, limiting availability for some consumers.
• Limitations of Mastercard Airport Experiences: Although it offers lounge access, this benefit is not free and may incur additional costs.
• Cashback limited to specific spending: The 0.5% cashback on purchases outside the selected categories is relatively low compared to other cashback cards on the market.

5- TD Aeroplan Visa Platinum

The TD Aeroplan Visa Platinum is a credit card specifically designed for frequent travelers, offering a variety of benefits and rewards through the Aeroplan loyalty program. 

This card can be a great choice for those looking to maximize their travel points, enjoy travel insurance, and obtain additional benefits when traveling with Air Canada and other partner airlines. 

The TD Aeroplan Visa Platinum allows cardholders to earn Aeroplan points on all eligible purchases, with additional opportunities to earn points in specific categories and direct purchases with Air Canada. 

Additionally, the card offers valuable insurance and protection benefits for travelers. 

Regarding point accumulation, it offers 1 Aeroplan point for every dollar spent on eligible purchases, plus extra points in specific categories such as groceries, public transportation, and purchases with Air Canada. 

Bonus point offers for new card customers meet the minimum spending requirements within a specified period. 

Comprehensive travel insurance, including trip cancellation or interruption insurance, emergency medical insurance, and car rental insurance. 

You get access to special benefits when traveling with Air Canada, such as priority boarding and savings on checked baggage fees. 

Protection against theft and damage to purchases made with the card, which is accepted in numerous locations worldwide, facilitating your payments on international trips.

Pros

• Rapid point accumulation: Opportunities to earn extra points in popular categories and purchases with Air Canada.
• Travel benefits: Several included travel insurances, which can provide peace of mind and savings in unforeseen situations.
• Attractive welcome bonuses: Significant bonus point offers for new cardholders, helping to accumulate points quickly.
• Access to exclusive events: Participation in exclusive events and special offers for cardholders.
• No foreign currency conversion fee: Save on fees when making international purchases.

Cons

• Annual fee: The card has an annual fee that can be high for some users, especially if they do not take full advantage of all available benefits.
• Credit requirements: The need to have a good credit history to be approved, which can be a barrier for some.
• Limited benefits outside Air Canada: While the card offers good rewards when traveling with Air Canada, the benefits may be less attractive for those who prefer other airlines.
• Complicated rewards: The Aeroplan rewards and redemption system can be complex and require careful planning to maximize benefits.
• High-interest rates: Relatively high-interest rates for unpaid balances, making it a less attractive option for those who carry a balance month to month.

6- CIBC Aventura Gold Visa

The CIBC Aventura Gold Visa is a credit card offered by the Canadian Imperial Bank of Commerce (CIBC), designed for those looking to accumulate travel rewards. 

This card stands out for its opportunities to earn Aventura points that can be redeemed for a variety of rewards, including airfare, hotel stays, and other products or services.

 Additionally, it offers a range of additional benefits that can be appealing to frequent travelers and customers who want to maximize their credit card rewards. 

Cardholders can earn Aventura points on all purchases, with accelerated earning rates in specific categories such as travel and purchases at the CIBC Travel Centre. 

Typically, there is a welcome bonus for new users, which can vary in Aventura points or annual fee discounts. It includes comprehensive travel insurance, covering cancellation, interruption, baggage insurance, and health insurance for medical emergencies abroad. 

Points can be redeemed for various travel options, not limiting cardholders to specific airlines or restricted dates. 

The card has an annual fee that can be waived or offset by the benefits and rewards accumulated over use.

Pros

• Rapid point accumulation: Accelerated earning rates in specific categories allow cardholders to earn points faster, especially on travel purchases.
• Welcome bonus: The welcome bonus is a significant incentive for new cardholders, offering a large number of points right from the start.
• Travel insurance coverage: Comprehensive insurance can save a lot of money and provide peace of mind for frequent travelers.
• Flexibility in point redemption: The ability to redeem points for a variety of travel options without severe restrictions increases the utility of the accumulated points.
• Access to exclusive offers and discounts: The card may include access to exclusive offers, discounts, and promotions, further increasing its value.

Cons

• Annual fee: The card’s annual fee can be considered high, especially for those who do not fully utilize the travel benefits or do not accumulate enough points to offset the cost.
• Interest rates: As with many credit cards, interest rates can be high if the balance is not paid in full each month, resulting in significant additional costs.
• Complex points program: Some users may find the rewards program complicated, especially concerning the accumulation rate and redemption options.
• Income requirements: The card may have minimum income requirements that can exclude some potential applicants.
• Limited travel benefits to cardholders: Some travel benefits, such as insurance, may be limited to the cardholder, not covering family members or companions without additional cost.

7- MBNA Rewards Platinum

The MBNA Rewards Platinum is a credit card offered by MBNA, a subsidiary of the TD Bank Group. This card is especially geared towards those looking to maximize the benefits of rewards on their daily purchases. 

With a flexible points program, cardholders can earn points on every purchase and then redeem them for a variety of options, including travel, merchandise, and statement credit. 

Cardholders earn 1 point for every dollar spent on all eligible purchases and have the opportunity to earn additional points, such as welcome bonuses, by meeting certain spending requirements in the first few months. 

The MBNA Rewards Platinum has no annual fee, making it an accessible option for many consumers. However, standard interest rates apply, at 19.99% for purchases and 22.99% for cash advances and balance transfers. 

It includes purchase protection, extended warranty, and travel insurance, such as car rental insurance and travel accident insurance, along with full account management via mobile app and internet banking.

Pros

• No annual fee: Ideal for those looking for a rewards card without the need to pay an annual fee.
• Flexible rewards program: Points can be redeemed for a wide range of options, including travel, merchandise, and statement credit.
• Welcome bonus: The possibility of earning extra points initially, offering a good initial incentive.
• Insurance benefits: Includes a range of insurances that can offer additional peace of mind during travel and purchases.
• Easy access and management: Online access and mobile app facilitate expense tracking and account management.

Cons

• High-interest rates: Interest rates for purchases, cash advances, and balance transfers are relatively high, which can be problematic if the balance is not paid in full each month.
• General rewards: The rewards program is more generic, with a fixed rate of 1 point per dollar spent.
• Redemption restrictions: Some redemption types may offer less value for points, requiring attention when choosing how to use the accumulated points.
• Limitations of insurance benefits: While it includes useful insurances, they may not be as comprehensive as those offered by other premium cards.

8- CIBC Costco Mastercard

The CIBC Costco Mastercard is a credit card offered by CIBC (Canadian Imperial Bank of Commerce) in partnership with Costco, designed to offer exclusive benefits to Costco members in Canada. 

This card is widely accepted and can be used anywhere Mastercard is accepted, making it a convenient option for daily purchases and for accumulating rewards. 

It offers 3% on restaurants and food delivery services and Costco.ca Gas, 2% on regular gas stations and Costco.ca purchases, and 1% on all other purchases, including in-store Costco purchases. 

There is no annual fee for cardholders who are paying Costco members, as the annual fee for the card is integrated into the Costco membership fee. 

The standard interest rate is 20.75% for purchases and 22.49% for cash advances. Some additional benefits include travel insurance and emergency medical assistance, extended warranty, purchase protection, and access to CIBC Mobile Banking.

Pros

• Cashback rewards: Cashback rewards are good, especially for those who frequently shop at Costco and spend on restaurants and gas.
• No additional annual fee: For paying Costco members, there is no extra annual fee, making this card an economical option.
• Global acceptance: As a Mastercard, the card is globally accepted, providing flexibility for international purchases.
• Insurance benefits: The card offers valuable insurances, such as travel insurance and purchase protection, which can be advantageous for frequent travelers.
• Ease of management: Integration with CIBC Mobile Banking allows for easy monitoring and management of finances.

Cons

• High-interest rates: The interest rates for purchases and cash advances are relatively high, which can be a problem for those who carry a balance on the card.
• Limitations on rewards: The cashback on in-store Costco purchases is only 1%, which may be less attractive compared to other credit cards that offer higher rewards at supermarkets.
• Requires Costco membership: Only Costco members can qualify for this card, limiting its accessibility to the general public.
• Rewards redemption: Cashback is redeemed once a year in the form of a coupon that must be used at Costco, which may not be convenient for all users.
• Foreign transaction fees: There is a 2.5% foreign transaction fee, which increases the cost of international purchases.

 

Have you evaluated the credit cards listed above and realized which one is best for you? If not, don’t worry and get informed before becoming a customer of any of them.

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