The Best Credit Cards for Canadians with Average Credit Scores
Not everyone has a perfect financial record: and that’s perfectly fine. Even with less than perfect credit, you have a plethora of options available thanks to a flexible and fair banking system. Credit cards for fair credit, or those with average creditworthiness, represent a step up in the credit card hierarchy. Credit-wise, Canadians who have reached the middle of the pack can access benefits like cash back and lower interest rates, even with some discrepancies or negative marks on their credit report.
|Credit Card||Card Features||Required Credit Score|
|BMO Preferred Rate Mastercard||A low interest rate of 12.99% on purchases and cash advances||Fair-Good|
|Scotiabank Value Visa||0.99% BTR for 6 months||Fair-Good|
|BMO Air Miles MasterCard||1 Air Mile/$20||Fair-Good|
|Best Western MasterCard||5 pts/$ at Best Western|
1 pt/$ elsewhere
What Is Fair or Average Credit?
Given a scale between 300 and 900, an ‘average’ credit score might range between 500 to 700. An often-cited ‘magic number’ for credit scores in Canada is 650. Some banks use this as a threshold for whether or not applicants are eligible to be approved for products like unsecured credit cards, while others consider applicants with credit scores on the lower end of the average range.
Individuals who have undergone bankruptcy or a consumer proposal will work hard, using secured credit cards and diligent saving, to reach this level. Someone who typically has good credit might temporarily dip into this level if they are delinquent on bills, make a series of late payments, or run their balance up to the limit of their available credit.
With the wide range of factors affecting credit scores, keeping it in great shape is a challenge. To find your credit score, navigate to TransUnion, Experian, or Equifax and sign up for their free reports. If you have reviewed your score, but find it does not meet the minimum to be considered “fair”, check out the articles here and here to learn how to improve it.
What Can I Do with Fair Credit?
With fair credit, you gain access to a wider range of financial tools that grant more freedom to spend and save. It can take hard work to reach this threshold, and if this is you – congratulations! Credit is an indicator of your personal financial diligence and a fair score gives you the option to take on more responsibility. Whereas those with poor credit may experience more limited access to financing, fair credit can be used to take out a bank loan, open a line of credit, or benefit from cards with more favorable terms.
Recommended Cards for People with Fair Credit
#1 The BMO Preferred Rate Mastercard
Even if your credit score is not quite perfect you can still get an excellent rate on purchases and balance transfers with the BMO Preferred Rate Mastercard. You do need a credit score of at least 650 to apply, but the low interest rate is extremely competitive for a card that is available to those with ‘only’ average credit. The card’s key features are:
- $20 annual fee
- 12.99% interest rate on purchases and cash advances
- 3.99% introductory interest rate on balance transfers for first 9 months
- 12.99% interest rate on balance transfers after 9 months
- Extended warranty and purchase protection on eligible purchases
#2 The Scotiabank Value Visa
The aptly named Scotiabank Value Visa card isn’t just for those in the upper echelons of creditworthiness. Scotia’s card grants a competitive 11.99% purchase interest rate to those with fair credit and charges a low $29 annual fee as well. With the option to transfer your balance and pay just 0.99% on it for 6 months, there are few cards that offer such a comprehensive toolkit for stemming the nonstop flow of interest. Additionally, cardholders will be eligible to receive a discount of up to 20.00% when renting vehicles at Avis branches in Canada.
- 0.99% rate for 6 months on balance transfers
- Competitive 11.99% interest rate on purchases
- Low $29 annual fee
- Receive up to 20.00% off at Avis
#3 The BMO Air Miles Mastercard
Just because your credit score isn’t the highest, doesn’t mean you can’t enjoy the vast travel benefits of the Air Miles program. The BMO Air Miles Mastercard offers new cardholders 1000 bonus Air Miles. In the meantime, they’ll enjoy the ability to collect 1 Air Mile for every $20 spent. At any of the Air Miles sponsored locations across Canada, the rate doubles. With so many ways to accelerate earnings and no annual fee, it’s ideal for many cardholders—not just those with fair credit. A balance transfer deal charging just 1.99% interest for 9 months is the cherry on top.
- 1000-Mile bonus gift
- Collect 1 Air Mile for every $20 spent
- $0 annual fee
- 1.99% interest for 9 months on balance transfers
#4 The Best Western Rewards Mastercard
This offer is not available for residents of Quebec. For residents of Quebec, please click here
Hotels represent some of the largest expenses incurred on any vacation or business trip, so it helps to carry a card that reduces the bite they take out of your wallet. The Best Western Rewards card is one of these cards, earning 1 point for every $1 spent in eligible purchases, 5 points for every $1 spent on Best Western properties worldwide, and a generous 20,000 points just for making an initial purchase with the card. That’s already enough for a free night’s stay. If that weren’t enough, this card bestows the “Gold Status” upon use of credit card, and can help new members shelter their transferred balances from interest (at 1.99% for 10 months). Add in some vital travel insurance perks and a $0 annual fee and the card is made even sweeter.
- Earn 5 points for every $1 spent at Best Western
- Receive 1 point for every $1 spent elsewhere
- Get 20,000 bonus points for an initial purchase
- Obtain “Gold Status” upon first use of your credit card
- Solid travel insurance benefits
#5 The American Express Essential Credit Card
Amex’s take on the low-rate credit card reduces the purchase interest rate to just 8.99%. It also exempts all cardholders from paying an annual fee and offers even lower interest on transferred balances. Accordingly, the card is great for those on a budget who might carry a balance month to month or have outstanding debt exposed to high interest. The American Express Essential Card also comes with the standard Amex perks, including new purchase protection and extended warranties, as well as $100,000 worth of travel accident coverage.
The cherry on top of the Amex Essential card’s suite of low-interest benefits is a balance transfer promotion offering 1.99% for 6 months, when you transfer a balance from another credit card. This will help multiply your savings and further accelerate progress on paying off debt before your rate returns to the already-favorable 8.99%. Cardholders need to make minimum payments each month and are only able to transfer up to $7,500 or 50% of their approved credit limit.
- Purchase interest rate of just 8.99%
- Balance transfer rate of 1.99% for 6 months
- $0 annual fee
- Purchase protection and extended warranties
- Travel accident insurance
*American Express is not responsible for maintaining or monitoring the accuracy of information on this website. For full details and current product information click the Apply link.
A Fair Credit Score Is an Important Step Toward Financial Security
Credit cards for fair credit scores offer far better terms than 588 credit score credit cards or in that range. Those who are just starting out their credit journey in Canada, like immigrants and young adults, might be wise to make reaching this credit score range one of their personal financial goals.
Keep an eye out for our upcoming article on the best cards for “good” credit, which brings a slew of lucrative deals for those with a score between 690 and 740.
*Note: According to our research, these credit cards offer the best chance of approval for applicants with credit scores of 660, 661, 662, 663, 664, 665, 666, 667, 668, 669, 670, 671, 672, 673, 674, 675, 676, 677, 678, 679, 680, 681, 682, 683, 684, 685, 686, 687, 688, and 689. This does not mean guaranteed approval as credit decisions take into factors other than credit score.
*This post was not sponsored. The views and opinions expressed in this review are purely my own.