Cash Back Rewards Credit Cards
Cash back rewards credit cards are great cards for people who like simplicity in their rewards. You know the value of your rewards and can easily calculate a return on your spending if you have a cash back card. In Canada, it would appear that the cash back cards are less rewarding than their siblings, the “Fixed-Value” rewards cards.
In this category, we have the Scotia Amex Gold card well ahead of the competition, then a few cards that are pretty much neck and neck as 2% return cards. The top 5 get rounded out with the TD First Class Infinite Visa, which can be a competitive card if you bank with TD and you can get your annual fee waived.
The Top 5 Cash Back Credit Cards in Canada are:
|Top 5 Cash Back Credit Cards|
|1. Scotia Momentum Visa Infinite
|2. MBNA Smart Cash|
|3. The SimplyCash™ Preferred card from American Express|
|4. Capital One Aspire Cash|
|5. Chase Amazon.ca Visa|
Redeeming Cash Back
Cash back rewards credit cards are those that give you your rewards in the form of (obviously) cash or statement credit. There are different ways that the rewards can be submitted to you. There are 2 key aspects, other than the cash back rate, that will make a cash back card better or worse:
- Minimum amount of rewards required to redeem
- Automatic redemption of rewards or user-initiated rewards redemption
On one end of the spectrum, the full amount of your award can come in as a statement credit automatically on a certain date. On the other end of the spectrum, some cash back cards require the cardholder to request a cheque / statement credit and can only do so after a minimum amount of rewards has been earned. Obviously the easier it is to redeem the rewards, and get all of your rewards in your hand, the better the card.
Cash Back Cards vs Fixed Value Rewards Cards
Something to think about is that the Fixed Value Rewards cards are very similar to the Cash Back credit cards. As a result, I have decided to put together some restrictions to delineate the difference.
A cash back card has the following requirements:
- You don’t need a specific purchase to release your rewards
- $50 or more in rewards can be redeemed for the best rate
Some examples of Fixed Value Rewards cards:
- The Scotiabank American Express Gold card requires a travel purchase to release the rewards
- The MBNA World Elite points can be redeemed against a minimum $100 travel purchase at the best rate but can be redeemed for $250 statement credit at the best rate
Examples of Cash Back cards:
- The American Express Costco card accrues points until the end of the year when all rewards are paid out in the form of a cheque
- The Amazon.ca card accrues points for each purchase. When $20 of rewards are accrued (2000 points) a statement credit is automatically issued
1. Scotiabank Momentum Visa Infinite
|Scotiabank Momentum Visa Infinite|
|Rewards:||4% cashback on gas, grocery
2% cashback on drugstores and recurring bill payments
1% cashback on everything else
|Sign-up Bonus:||First year free|
|Redemption:||Full balance awarded automatically at the end of 12 month period|
This is the cash back equivalent card of the Scotiabank American Express Gold card. This is a Visa credit card so it is accepted pretty much anywhere and it gives you a very high 4% cash back on gas and grocery spending. It also gives a 2% return on spending on drugstores and recurring bill payments so it is definitely at the top for those categories. Your rewards are redeemed automatically each year, so you don’t have to worry about forgetting to redeem your cashback or not being able to get all of them due to a redemption threshold. The annual fee is annoying but given the huge rate of return, this is my favorite cash back card in the Canadian credit card market.
2. MBNA Smart Cash Mastercard
|MBNA Smart Cash Mastercard|
|Rewards:||2 pt / dollar on gas, grocery
1 pt / dollar on everything else
|Sign-up Bonus:||5 pt / dollar on gas, grocery for the first 6 months|
|Redemption:||5000 pt = $50 cheque mailed automatically|
The MBNA Smart Cash card is a great card for people who want cash back, simplicity and no annual fee on their credit card. The 2% return on gas and grocery is great for a no annual fee card and 1% return on all other spending is the standard return for no-fee cash back cards. The other great thing about this card is that your rewards are send to you automatically once you achieve $50 worth of rewards. I really like this card as it is a nice compliment in case you have an American Express as your main spender.
3. The SimplyCash™ card from American Express
|The SimplyCash™ card from American Express|
|Rewards:||1.25% cash back when your Welcome Rate ends|
|Sign-up Bonus:||Enjoy a special 0% introductory interest rate on transferred balances in the first 6 months if you choose to transfer your other credit card balances to this American Express card at time of online application. A 1% balance transfer fee will be charged on the transaction amount and interest is payable on the amount of this fee at the applicable rate for purchase.|
If you’re fanatic about cash back cards, this credit card could be perfect. It offers a great 1.25% cash back on all purchases made and a 5% cash back bonus for the first 6 months of Cardmembership (up to $250 cash back). There is no limit to the cash back you can earn for the standard 1.25% rate and also there is no annual fee for supplementary cards.
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 now link.
4. Capital One Aspire Cash Platinum Mastercard
|Capital One Aspire Cash Platinum Mastercard|
|Rewards:||1% cash back on everything|
|Redemption:||Redeem as often as you like, no minimums (you must request)|
This card is the remnant of the Capital One Aspire World cash card that used to return 1.5% cash back and was easily the best cash back card in Canada. Unfortunately in late 2013, the “bonus” 50% of rewards was pulled, and now it only returns 1% cash back.
In terms of cash back cards, 1% is the standard return, so this card is nothing special. What makes this the best of the 1% cards is that it comes with a host of insurance benefits that most fee-free cards don’t come with. The other great thing about this card is that you can redeem your rewards whenever you want. Just request however much you want to redeem. You do have to initiate it though.
5. Chase Amazon.ca Visa
|Chase Amazon.ca Visa|
|Rewards:||2 pts / dollar spent at amazon.ca
1 pt / dollar on everything
|Sign-up Bonus:||$20 Amazon.ca gift certificate|
|Redemption:||2000 pt = $20 statement credit automatically|
The Chase Amazon.ca Visa is another basic card that does a good job. It gives the standard 1% cash back on all spending. There is the extra 1% cashback on Amazon.ca purchases so likely a small additional bump to average better than 1% return for a no fee card. Rewards accrue and are sent to you in the form of a statement credit as soon as you hit $20 worth of rewards.
This card makes the top list because it is simple and makes life easy for cardholders.