If used correctly, a student credit card can be an effective way to manage your finances. Many students are warned of the dangers of using a credit card. However, when used responsibly, a credit card can help to build your credit score. This will ensure you are in the best financial position when you graduate.
Students usually have minimal or no credit history. This makes it almost impossible to be approved for a traditional credit card, which would require a good credit score. Luckily, many banks now offer student credit cards. A student credit card can still provide many of the perks and rewards available with a standard credit card. These rewards give students an incentive to spend on their credit cards.
With an abundance of credit cards available to students, choosing the best student credit card for you can be difficult. To help you make your decision, we have prepared a list of the best student credit cards in Canada. Let’s take a look.
Student Credit Card Reviews
Tangerine Money-Back Credit Card
The Tangerine Money-Back Credit card is a popular option with students because of its low annual income requirement of $12,000. With no annual fee and some attractive cash-back options, it is easy to see why so many students choose Tangerine.
Although this credit card has some great rewards features, the application process will examine your credit history and credit score. Therefore, it may be the best option for older students with an established credit history.
Pros
- There is a 2% cash-back on all purchases in your two chosen categories. Category options include gas, groceries, drugstores, entertainment and restaurants. All other purchases have a cash-back rate of 0.5%.
- For those who also open Tangerine savings accounts, you can access a third category that offers a 2% cash-back.
- You can easily change your category choices for no additional fee.
- There is no limit to the amount of cash-back you can earn.
- There is no minimum balance requirement.
- There is no annual fee.
- Your cash-back rewards are calculated monthly, rather than annually. This gives you quick access to your rewards.
- You can apply for free additional cards for other users on your account.
Cons
- The approval process is more stringent than other student credit cards. This means it may not be accessible for the average student.
- The foreign transaction fees are 2.5% (see here the best no foreign transaction fee credit cards in Canada).
Summary
The Tangerine Money-Back Credit Card is an excellent option for students looking to save money and earn rewards on their purchases. Unlike many other credit cards, you can redeem your cash-back however you choose. Your options include paying off your credit card statement.
You could also opt to have the cash deposited directly into your savings accounts. The no annual fee and no minimum account balance requirements are attractive to many people, not just students.
It is important to bear in mind that this credit card has a higher acceptance threshold than other student cards. Therefore, it may not be the best option for the average student. However, if you are a student with a respectable credit history, this may be the best student credit card for you.
BMO® CashBack® Mastercard®*
The BMO CashBack Mastercard is a no annual fee rewards credit card. This is a great option for students because the credit score requirement is lower than traditional credit cards. This rewards card comes with a welcome bonus of 5% cash-back for the first three months. If you are looking for rewards credit cards that offer you cash-back on all of your purchases, this may be the best option for you. The BMO CashBack Mastercard consistently rates highly and is often recommended as one of the best student credit cards in Canada.
Pros
- After the 5% cash-back rate for the first three months, you will receive 3% cash-back on groceries, 1% cash-back on recurring bills and 0.5% cash-back on all other purchases.
- This credit card comes with two insurance types – purchase protection and extended warranties – for no additional fee.
- Receive a 1.99% introductory interest rate for the first nine months when you transfer your balance from other credit cards.
- You can choose to redeem your rewards at any time for a $1 fee.
- There is no minimum income requirement with BMO’s student card.
- You can also receive 25% off car rental prices with National and Alamo.
Cons
- The welcome bonus has a cap of $2,500, which equates to $125 in cash-back.
- There is also a low spending cap on groceries and recurring bills of only $500 each every month.
- The purchase interest rates are 19.99%, with a 22.99% rate on cash. Although this is a fairly standard rate for credit cards, it is higher than the typical interest rates for student credit cards.
Summary
This is one of the best student credit cards for helping you to build your credit rating while still allowing you to earn rewards. You are offered the same rewards rate as the standard BMO CashBack Mastercard but with a much higher chance of your credit score being accepted.
If you are looking for low-interest credit cards, this may not be the best option for you. However, the no annual fee and the cash-back rewards make this an attractive credit card to many students. To maximize your rewards, you should make your grocery and supermarket purchases on your credit card. This allows you to take advantage of the higher cash-back rates.
SCENE® Visa* card
The SCENE Visa Card is one of the best credit cards for students who spend their free time at the movies or enjoy eating at certain restaurants. With the chance to earn rewards when you spend at Cineplex, frequent cinema-goers can earn points quickly. The no annual fee also makes this an attractive option for many students. However, the limited points redemption options may stop some students from choosing this credit card.
HSBC +Rewards™ Mastercard®
Although many students do not want annual fee credit cards, it would be unwise not to consider the HSBC + Rewards Mastercard for this reason. The annual fee is only $25, and you get more perks than many other student credit cards. One of the main selling points of this Mastercard is the low-interest rates. On average, you will save 8% on the standard credit card interest rates. Depending on how much you spend and how quickly you pay off your charges, this could help you to save money on your monthly repayments.
Pros
- The annual fee is free for the first year.
- You can earn 2 points for every $1 spent on eligible dining and entertainment purchases. You can earn 1 point for every $1 spent on all other purchases.
- Interest rates are only 11.9% on purchases, cash advances and balance transfers! This is significantly lower than many other credit cards.
- There is no minimum income requirement, making this perfect for many students.
- Earn a welcome bonus of 20,000 points as long as you spend $2,000 in the first 180 days.
- Receive three different types of insurance for no additional fee. Extended warranty, purchase protection and price protection are all included in your account.
- You can choose to redeem your rewards in more ways, such as travel, gift cards, electronics and financial rewards.
Cons
- There is an additional annual fee of $10 for each authorized user on your account.
- Students looking for cash-back credit cards or credit cards with more points earned per $1 spent may want to consider other options.
Summary
This Mastercard from HSBC is one of the best low-interest credit cards available to students in Canada. Although there is an annual fee, this is a relatively low amount, and the fee is waived in the first year. You will also receive a generous welcome bonus of 20,000 points, which equates to $100! Some students may be looking for higher rewards potential. However, if you are searching for the best student credit card all-round, this is a solid contender.
SimplyCash™ Card from American Express
These no-fee cash back credit cards from American Express are a simple way for students to earn more rewards when making purchases on their credit cards. The rewards system is straightforward and easy to understand. As part of the welcome bonus, you will earn 2.5% cash-back on all purchases for the first three months. After this, you will earn 1.25% cash-back on all purchases. This easy to understand rewards system and the no annual fee are just some of the reasons why Simply Cash is often voted as one of the best student credit cards.
Pros
- There is no limit to the amount of cash-back you can earn.
- No annual income is required to qualify for this credit card.
- You receive more insurance coverage than other student credit cards. SimplyCash users will get up to $100,000 in travel insurance. You will also receive purchase protection, and the manufacturer’s warranty will be doubled (up to one year) by American Express.
- Access to American Express Invites and Front of the Line – This gives you access to pre-sale tickets for concerts and theatre.
- AMEX offers also gives you discounts on purchases from specific retailers.
Cons
- You cannot redeem your cash-back at any time. Instead, it can only be redeemed once a year.
- American Express is not as widely accepted as Visa and Mastercard.
- The interest rates are not as low as some credit cards – 19.99% on purchases and 21.99% on cash advances.
Summary
This card from American Express is one of the best no annual fee credit cards because of the additional perks and rewards you receive. Earning cash-back on all purchases is a great way for students to maximize their rewards. You also receive additional perks that are often not available with a student credit card. However, those students who will not pay off their full balance every month may be best suited to a low-interest credit card.
What is a Student Credit Card?
Student credit cards are designed specifically for students. This means any student is almost guaranteed to be accepted for one, regardless of their credit score. Similarly to a standard credit card, the best student credit cards on the market will come with a rewards system. You may be able to earn up to 5% cash-back or points every time you make a purchase on your credit card. These can then be redeemed in multiple ways.
Student credit cards differ from standard credit cards in several ways. The amount of credit a student will be offered will not be as high. Additionally, a student credit card does not come with as many additional perks as a standard credit card. There is also less choice, as many credit card issuers do not offer student credit cards.
Why Get a Student Credit Card?
Many students are warned about the dangers of spending money on credit. However, a student credit card is one of the best ways to build up your credit history and improve your credit score. Using a credit card responsibly will help you to raise your credit score by the time you graduate. This puts you in a strong financial position for the next phase of your life.
There are other important reasons why many students are now choosing to get student credit cards in Canada. In this current world of technology, credit cards are often required when making purchases online. You will also usually require a credit card to make any reservations, such as hotels or travel. Without a credit card, there are some payments you will not be able to make.
The best credit cards for students will also offer a welcome, bonus, rewards and perks. This means you can actually earn money on purchases you were already making! Many student credit cards also require no annual fee, meaning you do not have to pay to earn these rewards! However, ensure you are using the card responsibly. Try and pay off your credit card balance in full every month to prevent interest from accruing – a credit card calculator can help you find the best way to do it.
How to Choose the Right Student Credit Card For You?
Once you have decided to apply, finding the best student credit card to suit, you should now be a priority. There are several factors to consider when making your decision. There are some great student credit cards in Canada, but the best credit cards will usually come with no annual fee. This may be an important factor for many students without a guaranteed monthly income.
You may also want to consider the approval process. If you do not have a high credit score, you should only apply for a student credit card with low acceptance criteria. A failed application will have a negative impact on your credit score. Also, consider the annual income requirements to ensure you meet the specification.
Another important factor for many students is the rewards process. You should choose a credit card that best suits your lifestyle and financial habits. Some students prefer cash-back credit cards, whereas others want rewards credit cards that allow them to accrue points. Some people want a student credit card that comes with a welcome bonus. Also, consider what purchases you are making on your credit card, as different credit cards earn rewards in different ways.
Finding the best student credit card depends on your own requirements. Consider these carefully before making a final decision.
The Bottom Line
There are many banks and financial institutions that provide credit cards in Canada. Although a credit card specifically for students is not as common, you will still have plenty to choose from. Selecting the best credit card can be difficult. There are several things to consider when making your choice. Consider the annual fee amount, the income requirements and the strictness of the application process.
The best credit card for students will often offer rewards when you make purchases on your card. These rewards may include cash-back or rewards points. When considering which credit card to choose, look at how to maximize your rewards. You can do this by considering what purchases you will make most frequently. You can then choose a credit card that offers the best rewards for this spending.
Choosing from the best credit cards available to students can be difficult. Consider customer reviews, read the terms and conditions and research your options carefully. Making the best financial decision for you is very important. This will help you to graduate, not only with your hard-earned qualifications but also with a good credit score and more financial freedom.
