Best Balance Transfer Credit Cards and Offers in Canada
Balance transfer credit cards let you move debt from one credit card to another, ideally at a much lower interest rate for a limited time. Some cards offer promotional rates as low as 0%, which can make it easier to pay down debt because more of your payment goes toward the balance instead of interest.
But a balance transfer is not automatic savings. Most cards charge a transfer fee, the low rate expires and you may not be able to transfer your full balance. The best balance transfer card is the one that gives you enough time to make real progress on your debt at the lowest total cost.
Balance transfer credit cards: compare vs. choose
BACK TO TOPBalance transfer cards are not all useful in the same way. Some give you the longest 0% period. Some keep upfront costs low. Some are better if you may need a lower regular rate after the promo ends.
Use this tab to compare current balance transfer offers. Use the second tab to see NerdWallet’s handpicked picks by need.
| Card | NerdWallet rating | Intro interest rate | Apply Now |
|---|---|---|---|
| BMO Ascend™ World Elite®* Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 3.9/5 | 0% interest rate on balance transfers for 12 months | |
| BMO Blue Rewards Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 4.3/5 | N/A | |
| BMO Blue Rewards World Elite®* Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 4.5/5 | N/A | |
| BMO CashBack® Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 4.5/5 | 0.99% intro for 9 months on balances transfers | |
| BMO CashBack® World Elite®* Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 5.0/5 | 0% interest rate on balance transfers for 12 months | |
| BMO eclipse rise Visa Card* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 4.0/5 | 0.99% intro for 9 months on balance transfers | |
| BMO eclipse Visa Infinite Privilege* Card | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 3.4/5 | 0% interest rate on balance transfers for 12 months | |
| BMO Preferred Rate Mastercard®* | APPLY NOW on BMO's website | ||
 APPLY NOW on BMO's website | 2.9/5 | 0% interest rate on balance transfers for 18 months | |
| BMO Rewards® Mastercard®* | |||
 | -/5 | 0.99% intro on balance transfers for 9 months. | |
| CIBC Select Visa* Card | APPLY NOW on CIBC's website | ||
 APPLY NOW on CIBC's website | 3.8/5 | 0% interest rate on balance transfers for 10 months† | |
The best balance transfer offer depends on the balance you want to move and how long you’ll need to pay it off. In general, prioritize the longest 0% promotional period first, then compare transfer fees, annual fees and the regular interest rate that applies after the promo ends.
NerdWallet's take
NerdWallet's takeThis low-rate, low-fee card is ideal for those who typically carry a balance. You won’t earn any points or cash back, but getting a discount on interest charges could be a worthwhile tradeoff for the right cardholder. Best for: Anyone who wants to prioritize paying down their card balance over earning rewards.
Pros
- Low $29 annual fee.
- Low 13.99% interest rate.
Cons
- Doesn’t earn rewards.
Card details
Card details- Get a 0% introductory interest rate on Balance Transfers for 18 months with a 2% transfer fee and we’ll waive the $29 annual fee for the first year.*
- Enjoy our lowest interest rate of 13.99% on purchases.*
- Free extended warranty and purchase protection.*
- Zero Dollar Liability: protects you from unauthorized use of your credit card.*
- Worldwide acceptance at over 30 million locations.*
- Enjoy three months of Instacart+ and a $5 monthly Instacart credit when you enroll your eligible BMO Credit Card.*
- *Terms and conditions apply.
- BMO is not responsible for maintaining the content on this site. Please click on the Apply now link for the most up to date information.
NerdWallet's take
NerdWallet's takeWith no annual fee and a low 12.99% interest rate on purchases, the MBNA True Line Mastercard is an affordable, no-frills option to pay down debt and build credit. Just be mindful of the higher 24.99% ongoing rate for cash advances. Best for: Credit builders who carry a balance and don’t mind skipping the rewards.
Pros
- No annual fee.
- Low 12.99% interest rate on purchases.
- A minimum of 5% off on rental car bookings at Avis and Budget.
Cons
- The 24.99% cash advance rate is considerably higher than the purchase rate.
- No rewards.
Card details
Card details- No annual fee.
- Standard Annual Interest Rates of 12.99% on eligible purchases, 17.99% on balance transfers✪, and 24.99% on cash advances.
- You could get a 0% promotional annual interest rate (“AIR”)† for 12 months on balance transfers✪ completed within 90 days of account opening, with a 3% transfer fee.
- Around-the-clock fraud protection.
- Use available credit on your credit card to transfer funds right to your chequing account.
- This card is made from 100% recycled plastic
- †, ✪, Terms and Conditions apply.
- This offer is not available for residents of Quebec.
- Sponsored advertising. MBNA is a division of The Toronto-Dominion Bank (TD) and TD is not responsible for the contents of this site including any editorials or reviews that may appear on this site. For complete information on this MBNA credit card, please click on the "Apply Now" button.
NerdWallet's take
NerdWallet's takeThis low-fee card doesn’t earn rewards, but its gas discounts, fee-free global money transfers and low ongoing interest rates could be a valuable trade-off. Best for: Those who typically carry a card balance and want to save on interest.
Pros
- Low $29 annual fee.
- Low 13.99% purchase and cash advance interest rate.
- Up to 10 cents off per litre at Pioneer, Fas Gas, Ultramar and Chevron gas stations.
Cons
- Doesn’t earn rewards.
- Limited insurance coverage.
Card details
Card details- †$29 annual fee (first and second year rebated).
- †Purchase Interest Rate: 13.99%.
- †Cash Advance Interest Rate: 13.99%.
- Transfer your credit card balance of $100 or more - Get 0% interest for up to 10 months with a 1% transfer fee† (BT fee does not apply for Quebec residents) and a two year annual fee rebate.†
- Check full offer details below†:
- Transfer your credit card balance of $100 of more and get 0% interest for up to 10 months with a 1% transfer fee.† (BT fee does not apply for Quebec residents)
- Transfer up to 50% of your assigned credit limit.†
- If you choose to carry a balance and you make your minimum payments on time, a balance transfer could save you money on interest.
- Take advantage of this 0% introductory interest rate on balance transfers of $100 or more for your first 10 months. You’ll only have to pay a 1% fee† (BT fee does not apply for Quebec residents) when you transfer your balance from another card to the CIBC Select Visa Card.
- This balance transfer offer is only available at the time of your online application.† Simply tick the checkbox to select the balance transfer option when you’re filling out your application. Once you take advantage of this offer, you will have a promotional rate balance on your account. As a result, you will lose your interest-free grace period on new purchases unless you pay your amount due, including any promotional rate balances, in full each month. While you will enjoy the promotional rate on the balances you transfer by using this offer, new purchases will be subject to the purchase interest rate.
- Balance transfers of amounts less than $100 are not eligible for this promotional balance transfer offer and will be subject to the regular interest rate for Cash Advances applicable to your account.
- Save over $600 with CIBC and Skip – Get a 12-month Skip+ free trial and other exclusive benefits when you link your CIBC Select Visa Card with Skip.†
- Save on gas with CIBC and Journie Rewards – Link and use your CIBC Select Visa Card with Journie Rewards to save up to 10 cents per litre† at participating Pioneer, Fas Gas, Ultramar and Chevron gas stations.†
- †Terms and Conditions Apply. Select Apply Now to learn more.
NerdWallet's take
NerdWallet's takeThis low-interest card was made to cut borrowing costs with fixed interest rates on purchases, cash advances and balance transfers. There’s no rewards program, and insurance offerings are limited, but fuel discounts and complimentary DoorDash subscriptions provide additional value. Best for: People who typically carry a balance and don’t mind a low annual fee in favour of predictable fixed low interest rates.
Pros
- Low $20 annual fee.
- Fixed low interest rates.
Cons
- Doesn’t earn rewards.
- Limited insurance coverage.
Card details
Card details- Enjoy a 0.99% introductory interest rate for the first 10 months on balance transfers^ and no annual fee for the first year*. Apply by September 30th, 2026.
- Purchase security and extended warranty insurance.⁴
- Link your RBC card with a Petro-Points membership and instantly save on fuel at Petro-Canada stations and earn 20% more Petro-Points.
- Get a 6-month complimentary DashPass subscription – a value of almost $60. Plus, enjoy unlimited deliveries with $0 delivery fees on qualifying orders of $15 or more when you pay with your eligible RBC credit card⁷,⁸
- Enjoy unlimited deliveries with $0 delivery fees on orders of $15 or more when you pay with your eligible RBC credit card.
- Corresponding legal references and product terms are available on the RBC website, which will be available and agreed upon in the customer onboarding process.
- ^ In order to benefit from the 0.99% introductory interest rate on cash advances for 10 months, your application must be submitted by September 30th, 2026 and approved by us. The introductory interest rate offer is applicable to all cash advances (i.e. cash withdrawals from a bank branch or ATM with your RBC Royal Bank credit card, balance transfers, cash-like transactions and bill payments that are not pre-authorized charges that you set-up with a merchant). All other account activities, including purchases, are subject to the standard account annual interest rate(s) as shown in the Information Box. Interest is charged from the day the cash advance is made, until we receive your payment for the total amount you owe. The introductory interest rate on cash advances remains in effect through the first 10 full monthly statement periods (approximately 10 months from account open date). The Interest Rate Chart on your monthly statement will indicate the date on which the introductory interest rate expires, as long as you have a remaining balance associated with your introductory interest rate. If we do not process statements on the expiry date (for example, if it falls on a holiday or weekend), you will continue to benefit from that introductory interest rate until your statement is prepared, the next processing day. Once the offer expires: (i) all cash advances; and (ii) any remaining balances, which were subject to the introductory interest rate under this offer, will be subject to the cash advances interest rate indicated on your monthly statement. In general, if your credit card account consists of balances with different interest rates, such as purchases at the standard interest rate and cash advances at an introductory or promotional interest rate (e.g. a special lower rate balance transfer, or a temporary lower rate on all cash advances), any payment that exceeds the minimum payment due will be allocated to those balances in a proportionate manner. Your payment will not be applied to the balance(s) of your choice, such as the balance(s) with the highest interest rate, or to any category of balance(s) following a specific order. Please see the RBC Royal Bank Credit Card Agreement for details on how we allocate your payments. If you miss making any minimum payment by the payment due date and if you have not paid it before the date we prepare your next monthly statement, and/or if you change your actual RBC Royal Bank credit card for another type of card before the expiration of the offer, you will lose the benefit of this and any other introductory or promotional interest rate offer(s) in which you are participating and any remaining balance(s) which were subject to the introductory or other promotional annual interest rate under an offer(s) will be subject to the annual interest rate(s) indicated on your monthly statement, beginning on the first day of the third statement period after the missed payment. Cash advances do not qualify for Avion® points, partner rewards or cash back credits if your credit card is a type that earns rewards. Balance transfers cannot be used to pay any RBC Royal Bank credit card account or used for pre-authorized payments. Please call customer service at 1-800 ROYAL 1-2 (1-800-769-2512) for up-to-date information on your credit card account. Your RBC Royal Bank Credit Card Agreement explains the terms under which you use your RBC Royal Bank credit card. Please refer to it for full details. * To be exempt from the RBC Visa Classic Low-Rate Option annual fee for one year, your application must be received by September 30th, 2026, and approved by us. Additional cardholders (co-applicant and authorized user(s)), existing RBC Visa Classic Low-Rate Option cardholders, as well as existing cardholders of any RBC personal credit cards, applying for or transferring to an RBC Visa Classic Low-Rate Option, as of the offer eligibility period, are not eligible for this offer. This offer may not be combined or used in conjunction with any other offer.
Rewards breakdown
Rewards breakdownCash back on eligible purchases for the first 3 months (up to $2,000 in total purchases).¹
Cash back on all eligible gas stations, grocery stores, drug stores purchases and recurring payments.
Cash back on Transit, Rideshare and Food Delivery.
Cash back on all other eligible purchases.
NerdWallet's take
NerdWallet's takeThe Scotia Momentum No-Fee Visa Card doesn’t provide any bells or whistles, but it also doesn’t charge an annual fee, making it an option for people looking to build credit while earning cash back on everyday purchases.
Pros
- No annual fee.
- Earn up to 1% cash back on eligible purchases and recurring bill payments.
- Opportunity to earn 5% cash back on eligible purchases for the first 3 months (up to $2,000 in total purchases).
Cons
- No premium perks or benefits.
- The balance transfer promotional period cannot be used to transfer a balance from another Scotiabank Account.
Card details
Card details- Earn 5% Cash Back on all purchases for the first 3 months (up to $2,000 in total purchases).¹ Plus, get a 0.99% introductory interest rate on balance transfers for the first 9 months (2% fee per cash advance, 22.99% after that; annual fee $0).¹
- You will earn 1% on all eligible purchases of Transit, Rideshare and Food Delivery¹.
- New Cash Back Anytime feature: Redeem your cash back that you’ve earned whenever you need it, through the Scotia app or Scotia Online ($25.00 minimum redemption)¹.
- Rates, fees, offers and other information are effective as of July 2, 2026. Subject to change.
- *See Card Provider's website and Card Application for complete card details, terms and current offers. Reasonable efforts are made to maintain accuracy of information.
Rewards breakdown
Rewards breakdownCash back in two 2% categories of your choice.
Cash back on all your other everyday purchases.
NerdWallet's take
NerdWallet's takeYou can earn unlimited 2% cash back in up to three categories of your choice, making it one of the more flexible cash-back programs in Canada. The card comes with more perks than the Money-Back version — mobile phone and rental car coverage, as well as discounted airport lounge access and a complimentary data roaming plan with Flexiroam. But the $50,000 minimum income requirements may be restrictive for some users. Best for: Travellers who spend big in unique categories and want a flexible cash-back program.
Pros
- No annual fee.
- Choose the 2% cash-back categories based on your spending.
- Mobile phone and rental car insurance.
Cons
- Must have a Tangerine savings account to unlock 3rd cash-back category.
Card details
Card details- Get $100 with a Money-Back World Mastercard®* Spend $1,500 in your first 3 months to enjoy this Bonus. It’s the no annual fee Credit Card with the most cash back categories to choose from ††. Offer Expires September 30, 2026.
- Two Categories – 2% Money-Back Rewards on purchases in two categories of your choice. OR Three categories Deposit your Rewards into a Tangerine Savings Account and get a third 2% Money-Back category. 13 Categories to explore – Groceries, gas, and beyond, choose from 13 categories to suit your spending. And change them up every 90 days to match your purchases.◊
- 0.5% on everything else.
- With Mastercard Travel Rewards, you can unlock cashback offers and get a rebate applied directly to your statement, by using your Tangerine® Money-Back World Mastercard®* at select merchants that accept Mastercard while travelling outside of Canada.
- Save on the things you love with your Tangerine® Money-Back World Mastercard®*. Enjoy special benefits and offers from a growing lineup of on-demand apps and subscription services made available to you as a Tangerine® Money-Back World Mastercard®* cardholder.
- Make the most of your travel with Mastercard® Travel Pass Provided by DragonPass. Your complimentary membership gives you exclusive dining, retail and spa offers in over 650 airports worldwide, along with access to over 1,300 airport lounges at $32 USD per visit. Learn more at Mastercard® Travel Pass.
- Rental Car Collision/Loss Damage Insurance**: Damage and theft protection for your car rental when you rent for up to 31 consecutive days and charge the full cost of your rental to your Card.
- Mobile Device Insurance**: Protection on new cell phones, smartphones or tablets when you charge the full cost to your Card, or when you purchase it through a plan and charge all of your wireless bill payments to your Card. Covers up to $1,000 if your mobile device is lost, stolen, accidentally damaged or experiences mechanical failure.
- Preferred rates: 20.95% for purchases, 22.95% for cash advances (including balance transfers).
- To be eligible, a $50,000 (individual) annual income is required. Also, you must have a Canadian credit file and be a Canadian resident of the age of majority in the province or territory where you live.
Methodology
BACK TO TOPHow did we select credit cards for this roundup?
NerdWallet Canada selected the best balance transfer credit cards based on overall consumer value and suitability for people who want to reduce interest on existing debt.
Key factors in our evaluation include:
Promotional balance transfer interest rate.
Length of the promotional period.
Balance transfer fee.
Annual fee.
Regular interest rate after the promotional period ends.
Transfer limits and issuer restrictions.
Eligibility requirements.
Whether the card has ongoing value after the balance transfer period.
Rewards, welcome bonuses and insurance benefits may be considered, but they are secondary to the cost and usefulness of the balance transfer offer.
How balance transfer credit cards work in Canada
BACK TO TOPA balance transfer credit card lets you move debt from one credit card or credit product to another credit card. The new card charges a lower promotional interest rate on the transferred balance for a set period of time.
Promotional rates may be as low as 0%, and offers often last between six and 18 months. During that time, the lower rate can keep your balance from growing as quickly.
If you pay off the transferred balance before the promotional period ends, you may save a substantial amount of interest. If you don’t, the remaining balance will be charged the card’s regular interest rate.
Balance transfers are usually treated like cash advances, not purchases. That means they typically do not get an interest-free grace period, and they usually do not earn rewards.
How to choose a balance transfer credit card
Balance transfer cards are not really about rewards, perks or welcome bonuses. They’re about buying time at a lower interest rate so you can pay down debt faster.
Use these factors to compare offers.
1. Start with the promotional rate
The lower the promotional interest rate, the less interest you’ll pay while the offer is active. A 0% balance transfer offer is usually the strongest option, but only if the transfer fee, annual fee and promo length still make sense for your balance.
2. Compare the length of the offer
A longer promo period gives you more time to pay down your balance before the card’s regular interest rate applies.
If you can pay off the balance quickly, a six-month offer may be enough. If you need a year or more, a 12- or 18-month offer may be more useful, even if the card has an annual fee.
3. Check the balance transfer fee
Most cards charge a fee to move your balance. This fee is usually a percentage of the amount transferred and is added to your new card balance.
Balance transferred | Transfer fee | New balance |
|---|---|---|
$5,000 | 1% | $5,050 |
$5,000 | 2% | $5,100 |
$5,000 | 3% | $5,150 |
4. Include the annual fee
Some balance transfer cards charge an annual fee. That doesn’t automatically make them a bad deal, especially if the card offers a longer 0% period or lower ongoing rate. But the annual fee should be included in your total cost.
5. Look at the regular interest rate after the promo
Any balance left after the promotional period ends will be charged the card’s regular rate. That rate may be much higher than the promotional rate.
If you’re not confident you can pay off the full transfer before the promo ends, a card with a lower regular interest rate may be more useful than a card with the flashiest short-term offer.
6. Make sure the issuer will accept the transfer
Credit card issuers usually don’t allow balance transfers between their own cards. For example, you generally can’t use a new card from the same bank to pay off an existing credit card from that bank.
Transfer limits may also apply. Some issuers may only allow you to transfer up to a certain percentage of your approved credit limit.
Is a balance transfer worth it?
A balance transfer may be worth it if the interest savings are greater than the fees and you can avoid adding new debt.
A balance transfer may be worth it if:
You’re carrying credit card debt at a high interest rate.
You qualify for a promotional balance transfer offer.
The transfer fee is less than the interest you’d otherwise pay.
You have a payoff plan for the promotional period.
You can avoid using the old card for new purchases.
A balance transfer may not be worth it if:
You can only afford the minimum payment.
The transfer fee wipes out most of the savings.
You’ll keep spending on the old card.
You won’t qualify for enough credit to transfer the balance.
You’re likely to still have a large balance after the promotional period ends.
Quick payoff check
Before you apply, divide your new balance by the number of months in the promotional period.
If you transfer $5,000 with a 3% fee, your new balance is $5,150.
Promo period | Monthly payment needed to pay off $5,150 |
|---|---|
6 months | About $858 |
10 months | About $515 |
12 months | About $429 |
18 months | About $286 |
If that monthly payment feels impossible, the balance transfer may still reduce your interest costs, but it may not solve the debt on its own.
Balance transfer credit card alternatives
A balance transfer card is not the only way to deal with high-interest debt.
Line of credit
A line of credit may charge a lower interest rate than a credit card, though usually not as low as a 0% promotional balance transfer offer. Interest starts accruing as soon as you borrow, and rates may change based on the bank’s prime rate.
Debt consolidation loan
A debt consolidation loan combines multiple debts into one loan with a fixed repayment schedule. This may be useful if you want predictable payments and a clear payoff date.
Lower-rate credit card
If you often carry a balance, a low-interest credit card may be more useful than a rewards card. You may not get a 0% promo, but a lower ongoing rate can save money over time.
Credit counselling or debt management plan
If your debt feels unmanageable, a nonprofit credit counselling agency may help you review your options, build a budget or set up a debt management plan.
How to compare balance transfer credit cards
Not all balance transfer cards are created equal. Consider these factors to help you decide which balance transfer card is best for you.
Balance transfer promotional periods
Balance transfer promotional periods vary by card. Some cards offer 0% interest for six months, while others offer 0% for 12 months or longer.
Before applying, choose a promotional period that matches your repayment plan. Review your budget to make sure you can afford the monthly payments required to pay off the debt before the promotional period ends.
Any balance left at the end of the promotional period will revert to the card’s regular interest rate, which may be close to the rate on your current card.
Balance transfer fees
Card issuers often charge a balance transfer fee, typically 1% to 3% of the amount transferred. This fee is added to your new balance.
For example, a 1% balance transfer fee on $5,000 adds $50 to your balance. A 3% fee adds $150.
Transfer fees can eat into your interest savings, so compare the full cost of each offer, not just the promotional rate.
Rules set by the issuer
Each card issuer sets its own balance transfer rules. Review the card’s terms and conditions before applying.
Important rules may include:
How soon after approval you must request the transfer.
The minimum transfer amount.
The maximum amount you can transfer.
Whether transfers from the same issuer are excluded.
Whether the promotional rate applies only to balance transfers or also to other cash advances.
What rate applies after the promotional period ends.
Impact of annual fees
Some balance transfer cards have annual fees, which affect the total cost of the offer.
An annual fee may be worth paying if the card gives you a longer promotional period, lower transfer fee or lower regular interest rate. But if two cards have similar offers, the lower-fee card will usually be cheaper.
Regular interest rates after the promo
The promotional rate is temporary. Once it ends, any remaining transferred balance will be charged the card’s regular rate for balance transfers or cash advances.
If you expect to carry part of the balance beyond the promo period, prioritize cards with lower ongoing rates.
Qualification requirements
To qualify for a balance transfer credit card, your current credit account generally needs to be in good standing. A strong credit score may improve your odds of approval and may help you qualify for a higher credit limit.
Minimum income requirements will also apply.
What to do after a balance transfer
Getting approved for a balance transfer card is only the first step. The payoff plan matters more.
1. Stop using the old card
If you transfer a balance and then keep spending on the old card, you may end up with two balances instead of one.
2. Avoid new purchases on the balance transfer card
New purchases may be charged at the card’s regular purchase rate. They can also make payments harder to track if your card has balances at different interest rates.
3. Set a monthly payoff target
Divide your new balance by the number of months in the promotional period. Use that number as your target monthly payment.
4. Track the promo end date
Add the promotional period end date to your calendar. Give yourself a reminder at least one month before the regular interest rate applies.
5. Keep making minimum payments
A promotional rate does not mean you can skip payments. Missing a payment may cause you to lose the promotional rate and could hurt your credit score.
» Not into math? Use our credit card interest calculator.
Frequently asked questions
Does a balance transfer card affect your credit score?
While transferring the balance itself won’t negatively affect your credit score, applying for a new credit card will. Card providers conduct a hard credit check when assessing card applicants. Hard credit checks appear on your credit report and affect your credit score.
What happens to the old credit card after a balance transfer?
When you move your credit card balance to a new card, the card provider pays off the old balance on your behalf using available credit from the new card. Your old credit card account remains open, and you can continue to make purchases with the card. You’ll remain responsible for any annual fees associated with the account and repaying any balance that remains.
How do you transfer a credit card balance?
Apply for your new card online through the financial institution’s website or at a branch.
During the application process, the new credit card provider will typically ask you to check a box or fill out the information to set up a balance transfer from another card. Expect to provide the card number, issuer name and amount you want to transfer.
Once the credit card application is approved, the transfer will take place.
How much can I save with a balance transfer?
If you carry a large balance on your credit card from month to month, transferring it to a credit card with a lower rate can result in significant savings, especially if you refrain from making new purchases.
For example, let’s say you transfer a balance of $5,000 to a balance transfer card with 0% interest for 12 months, plus a transfer fee of 3%. The only cost accrued on the balance transfer card would be $150, per the transfer fee. However, if you kept the $5,000 on a 20% APR card and paid it offer in one year, the interest accrued during that time would be close to $500.
What is a 0% balance transfer credit card?
Some balance transfer credit cards offer an interest rate of 0% during the promotional period. That means a balance transferred to that card won’t accrue any interest during the introductory period, making it easier to pay off. After the 0% promotional period, any remaining balance will be subject to the card’s regular APR, which often sits closer to the average Canadian credit card purchase rate of 20%.
What are the pros of balance transfers?
Credit card balance transfers can help you:
Pay less interest. If you typically carry a balance, a 0% interest offer on a balance transfer credit card can help you save money on ongoing interest charges.
Reduce your debt faster. High interest rates can contribute to your debt load. With a low interest rate, more of your monthly payment goes toward reducing the principal balance. This can help you pay off debt faster.
What are the cons of balance transfers?
Consider the following drawbacks as you compare your card options:
Potential for a high ongoing rate. After the promotional period ends, your balance transfer credit card will revert to a regular interest rate, and any remaining balance will be subject to that rate — which may be as high as the one from your previous credit card.
Balance transfer limits. If you carry a large balance on your old credit card, there’s also a chance you won’t be able to transfer the entire balance over to the new card due to balance transfer limits.
Transfer fees. Expect a percentage-based fee for moving your balance from one credit card to another.
JUMP TO:
Is a balance transfer card right for you?
Balance transfer cards may help with high-interest debt if you have a solid repayment plan for the promotional period.
They won’t be so helpful if you continue spending on original accounts, make only minimum payments, or don’t qualify for enough credit to move the balance.
If you’re still deciding which type of credit card best fits your needs, compare options across categories in our guide to the best credit cards in Canada.
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