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A prepaid card, sometimes referred to as a “prepaid credit card”, can serve as a budgeting tool or an easy way to make online or in-store purchases. Some even earn rewards.

Make the most of this widely accepted payment method by learning more about Canada’s best prepaid cards.

Best prepaid cards in Canada

Annual Fee
$0

Rewards Rate
5% average cashback

Minimum Deposit
$0

Maximum Deposit
$200,000

Why we like it

The Neo Money™ Card is a no-fee prepaid Mastercard linked to the online bank’s popular high interest savings account. Earn 4.00% interest on your funds in the Neo Money account and enjoy an average of 5% cashback on transactions at partners in the Neo rewards network.

Pros

Build your savings with competitive interest on funds held in the Neo Money account.
Free Interac e-Transfers, bill payments and mobile bank-to-bank transfers.
Earn an average of 5% unlimited cashback at thousands of Neo partners, which includes local businesses.

Cons

The cashback you receive will vary depending on where you shop, but you can expect at least 0.5% cashback every month with Neo’s minimum cashback guarantee.

Get high interest on your savings and high cashback when you spend with your Neo Money™ card.
Earn unlimited cashback – Get an average of 5% cashback at over 10,000 partners across the country, in real-time, with no monthly limits on how much cashback you can earn.
Instant access to your balance with no card loading required.
Free everyday transactions and no monthly fees.
Withdraw from any ATM worldwide.
4.00% interest on every dollar.
Enable the Auto-Save feature to set up automatic savings and register your email to instantly deposit Interac e-Transfer® requests in your Neo Money™ account.
Take the pain out of bill pay by setting up automated payments from your Neo Money™ account.
Customers can get up to 4% cashback on all purchases at Shell gas stations and convenience locations when they use their Neo Credit, Neo Secured Credit or Neo Money™ card. Earn 2% cashback at the pump or convenience store locations. Earn 4% cashback on transactions made through the Shell App. Offer available in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. Boost these offers by 50% when you add Everyday Essentials perks to your card.

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KOHO Prepaid Mastercard (Essential Plan)

Annual Fee
$48

Rewards Rate
1%-50%

Minimum Deposit
$0

Maximum Deposit
$200,000

Why we like it

With Cashback on eligible purchases, the ability to earn interest on your balance and discounted rates for credit building add-ons, this is not your typically prepaid card.

Pros

Low annual fee of $48 ($4 per month).
Ability to earn 5% interest on your balance.
Ability to earn between 1% and 5% cashback on eligible purchases.

Cons

Credit-building option is not included for free.
No insurance coverage.

Earn 1% cash back on groceries, eating & drinking, and transportation. Plus, up to 50% extra cashback from select merchants.
Earn 5% interest on both your spending and savings account. Your funds will also be eligible for CDIC insurance. Interest rates are per year, calculated daily, paid monthly, and can change at any time without notice.
Choose from one of four exciting card colours. Receive both a physical and virtual card.
Start adding funds and shopping online while you wait for your physical card to arrive in the mail. No need to budge from your couch to make online purchases. Just use your virtual card!
Card Security – KOHO provides a different card number to help protect your physical card number when you’re shopping or booking services online
Add your KOHO card to Apple, Samsung or Google Pay
Automate your savings with Goals and RoundUps. Rounding up every purchase lets you stash away some savings, while Goals make it easier to save for whatever it is that makes you happy
Lock in savings with Vault that keeps the funds you don’t want to spend separate from your spendable balance
Create custom budgets and track your spending habits. Know where you’re at in real time with instant notifications every time you spend.

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Annual Fee
$0

Rewards Rate
1%

Minimum Deposit
$0

Maximum Deposit
Unlimited

Why we like it

Beginner investors interested in learning more about building wealth will feel right at home with the Wealthsimple Card, a no-fee prepaid Mastercard that earns 1% cash back on purchases. Use the rewards to support your TFSA, invest in stocks, ETFs and crypto, or fund your linked spending (Cash) account, where you can send, spend and receive money instantly with the Wealthsimple Cash app.

Pros

Use a Visa or Mastercard debit card to instantly deposit up to $3,500 per day (up to a maximum of $35,000 per month).
Effortlessly build an investment portfolio by transforming cash back rewards into stocks, ETFs or cryptocurrency deposited directly into a trading account.

Cons

There’s no brick-and-mortar location for Wealthsimple customers, so you need to be comfortable managing your money with an online-only company.
$5,000 per day spending limit; ATM withdrawals are limited to $500 per transaction/$1,000 per day.
Cash rewards invested into cryptocurrency are subject to Wealthsimple Crypto’s 1.5-2% fee.

General fees and features: Wealthsimple does not charge any fees to use the Wealthsimple Card.
Currency conversion fee: Mastercard will determine the applicable exchange rate from the range of rates available in wholesale currency markets for the applicable processing date, which may vary from the rate Mastercard itself receives.
ATM withdrawals: Wealthsimple does not charge any fees for withdrawing cash, but you may see a standard ATM withdrawal fee (usually about $3.00) when you make a withdrawal at an ATM. ATM Withdrawal limits are $500 per transaction and $1,000 per day.
Reload methods: Add funds to your card by making a deposit via a linked bank account, a wire transfer, your Visa or Mastercard debit card, or an institutional transfer to move an account from another institution.
Rewards: Earn 1% cash back on eligible purchases. Cash back rewards can go directly into your Spend account, be added to the cash balance of a stock trading or crypto trading account, or be used to auto-purchase the cryptocurrency of your choice in your crypto trading account. Use the card anywhere Mastercard is accepted — in-store, in apps, or online. Pay bills, use direct deposit, and e-Transfer.
The Wealthsimple Card is available as part of the everyday spending account, which comes with both a digital and physical card that you can manage right from the Wealthsimple app.
Use the app to manage your rewards and spending preferences, or lock your card if something happens to it. Your balances are all updated in real-time, too — even if you’re using the physical card
Add your Wealthsimple Card to Apple, Samsung or Google Pay digital wallet.
Use the Wealthsimple Cash app to send and receive payments to anyone else who uses the Cash app without paying fees. You can also send money to people who don’t have the Cash app yet. They will receive a prompt to download the app and claim the money you sent them.
Your money is protected for up to $100,000 through CDIC.
To be eligible, you must be a Canadian resident with a Social Insurance Number of the age of majority in the province or territory where you live.

Methodology: How we evaluate cards

NerdWallet Canada selected the best prepaid cards based on overall consumer value and their suitability for specific kinds of consumers. Factors in our evaluation methodology include: features specific to prepaid cards (such as minimum and maximum deposit, maximum reload amount in a 24-hour period, ATM access, insurance benefits, digital wallet compatibility, and more); fees (such as annual fees, foreign exchange or conversion fees, among others); reward value (considering any earn rates, reward structures, and other benefits); and the intro offer (assessing any welcome bonus, waived fees, referral programs, and other promotions for new customers. Only reloadable prepaid cards that are available online were considered for this list.

Summary of the best prepaid cards

CARD NAME	Best for	Annual Fee
KOHO Standard Prepaid Mastercard - Essential Subscription Plan	Best prepaid card for: Credit building.	$48 ($132 with credit-building plan).
Neo Money™ Card	Best prepaid card for: Cash back.	$0.
Wealthsimple Card	Best prepaid card for: Novice investors.	$0.

Best Credit Cards in Canada

Compare all different credit cards side-by-side and find out the best card that will meet your need with special perks and benefits

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What to know about prepaid cards

In this section, we’ll help you navigate the world of prepaid cards by exploring the following topics:

What is a prepaid card?
How do prepaid cards work?
Where to buy prepaid cards
Choosing the best prepaid card for you
Getting the most out of your prepaid card

What is a prepaid credit card?

Prepaid credit cards aren’t technically credit cards because you’re not borrowing the money. Instead, they function similarly to debit cards and gift cards in the sense that you can only spend the money you already have.

You might hear them referred to as “reloadable credit cards”, “pay-as-you-go credit cards” or “prepaid cards”, but they generally all work the same way.

How do prepaid cards work?

Instead of borrowing money, you load funds onto a prepaid card and then use it to make purchases. How much money you load onto the card determines the total amount you can spend.

There are two varieties of prepaid cards:

Closed-loop cards, which have a set amount of money already loaded, much like a store gift card.
Open-loop cards, which can be used anywhere, and are typically reloadable..

Once you’ve received a prepaid card and added funds to it, you can use it to make online and in-person purchases wherever the card’s payment merchant (Visa, Mastercard or American Express, for example) is accepted.

Types of prepaid cards

There are several different types of prepaid cards available, so it’s a good idea to know what they are and how they work.

Prepaid Mastercards can be used everywhere Mastercard is accepted, including Costco, which does not accept Visa and American Express for in-store purchases.
Prepaid Visa Cards can be used anywhere Visa is accepted. Visa also makes gift cards, which are sold (and accepted) at many retailers.
Prepaid Amex Cards come in set amounts and are not typically reloadable. You can only use them at merchants that accept American Express.
Prepaid travel cards are generally reloadable cards that may hold multiple foreign currencies or offer travel perks. A card loaded with multiple currencies allows you to know the exchange rate upfront, and you won’t need to carry different physical currencies. Some also allow you to withdraw funds at foreign ATMs and limit foreign transaction fees.
Prepaid gift cards may be available for a specific merchant or network of retailers, or as a general Visa, Mastercard or Amex card that can be used anywhere. These cards are usually not reloadable.

Prepaid card maintenance

Using a prepaid credit card requires a little work on your end. You’ll have to:

Activate your card. Most are activated as soon as you load funds, but others may require you to register your card before activation.
Check your card’s balance. Some prepaid cards have a website where you can check your balance. Others have an app.
Reload your card. You can typically add more funds to your reloadable prepaid card via an app, your online account or e-Transfer. A few cards let you reload your balance at select locations like the post office. You may be able to transfer the balance of one gift card to another if they’re from the same merchant.

Where to buy prepaid cards

Prepaid cards that have set limits can be purchased at some grocery stores, drug stores and gas stations. A few banks and credit unions offer reloadable cards online and in person.

The most common way to obtain a prepaid card is by securing one through an online-only bank. These cards tend to carry more features, like rewards and spending insights. You can generally apply for these cards online in a few minutes, and they get shipped right to your address, so there’s little effort on your end.

How much does a prepaid card cost?

Closed-loop cards, such as gift cards, generally have no fees: you just need to pay for the amount you load onto the card.

Open-loop cards, however, typically charge some sort of fee. Some may come with an activation fee, charge an annual or monthly fee regardless if you’ve used your card or not, or require you to pay a fee whenever you reload funds to the card.

Choosing the best prepaid card for you

The essential features to consider when choosing a prepaid credit card include:

Network. Some merchants do not accept cards from every network (Visa, Amex or Mastercard, for example), so choose a network that works at most of the places you shop.
Fees. Some prepaid cards may have monthly fees and costs associated with activation and reloading funds, as well as foreign exchange and foreign ATM fees.
Limits. Many prepaid cards have daily load, spending, cash withdrawal and transaction limits.
Rewards. A few prepaid cards earn rewards, such as cash back.
Loading options. Every prepaid credit card has different loading options, such as in-person, online or via an app. Make sure the one you opt for makes loading your card convenient and quick.

Other considerations might include:

ATM access. If you need access to cash, you can use some prepaid cards to withdraw funds from ATMs. Fees likely apply.
Security features. Some prepaid cards have enhanced security features like chip and PIN and the ability to freeze your card. Gift cards typically do not have any security features.
Spending insights. Prepaid credit cards offered by online-only banks and fintech companies may give you spending insights to help you understand where your money is going, or tools to boost your money management skills.
Referral bonuses. Some prepaid cards have a cash referral bonus when you sign up and load funds. In most cases, both the referrer and the referee get a reward.
Direct deposit. A few prepaid cards allow you to set up direct deposits to have payments, like your paycheque, sent right to your prepaid card.
Payment options. Some also let you pay bills, use foreign currencies, send Interac e-Transfers or send money directly to other users as you would with a mobile payment app.
Virtual use. Fintech prepaid cards typically have a virtual card (usually available in the app), so you don’t need to carry your physical card. Some are compatible with digital wallets, like Google Pay.

Getting the most out of your prepaid card

A prepaid card can come in very handy for both online and in-person shopping. And since using one doesn’t typically affect your credit score, it can be a relatively low-risk way to make purchases.

Who can benefit from using a prepaid card?

Someone unable to obtain a traditional credit card due to their credit history, and want to take advantage of credit building services offered by some prepaid card providers.
Newcomers to Canada who are ineligible for a traditional credit card and haven’t yet set up a bank account.
Unbanked or underbanked consumers struggling to qualify for a traditional credit card or bank account.
Kids or teens who aren’t old enough for a credit card or bank account and want to practice budgeting their money.

Pros of prepaid cards

No overspending. Because you have to load a prepaid credit card before using it, you can’t spend money you don’t have. Just make room in your budget for the cash you plan to spend.
Safer than cash. If you lose the money in your wallet, it’s usually gone forever. Some reloadable prepaid cards may allow you to recover your funds even if your card is lost.
Easy to reload. Reloads on prepaid cards can often be done in-person, online or via a mobile app.

Cons of prepaid cards

No credit building. Since prepaid cards aren’t credit cards, your credit score won’t improve while using them unless the provider offers a credit-building program.
Limited rewards. While some prepaid cards give you cash back, you won’t get the attractive additional benefits that come with traditional credit cards, such as airport lounge access, travel insurance and mobile device insurance.
Potential fees. Some prepaid cards have activation and monthly fees that can eat into your balance.

Alternatives to prepaid cards

Use debit. Physical and virtual debit cards, which are tied to a bank account, give you direct access to your chequing account. Just be wary of how much you’re spending — you might run through your entire cash supply quicker than you think.
Go secured. Secured credit cards act like traditional credit cards but require a security deposit to apply. The card’s credit limit is typically equal to the security deposit.. The advantage over prepaid cards is that secured cards can help you build your credit score. See our picks for the best secured cards in Canada.

» MORE: The best credit cards for bad credit

The best prepaid cards in Canada offer convenience, low costs and perks. See above for our top picks.

Prepaid cards can be useful for making in-person and online purchases if you don’t have, or can’t get approved for, a traditional credit card or bank account. There are no interest charges associated with prepaid credit cards, so they aren’t likely to add to your overall debt load.

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