Best Credit Card Alternatives in Canada (2021)

Credit cards come with their own sets of benefits and drawbacks and while their points and rewards can be enticing, it shouldn't come as a surprise that their interest rates, typically +20% or higher annually), are the absolute worst. Missed credit card payments can be a heavy weight on credit scores if used incorrectly. Fortunately enough, a handful of credit card alternatives have been popping up in Canada that allow you to only pay with however much you have available, without the risk of overdraft fees and runaway credit card debt.


Koho offers different tiers of pre-paid Visa card offerings that provide a bevvy of nice cashback rewards you don't typically see with pre-paid cards. Its base account is free and gives you 0.5% cashback across all purchases and gives you flexible options to round up and save money in an interest-bearing savings account. Their premium products cost $9/month (or $84 a year) and give 2% cashback on all purchases, as well as no FX fees. Because you're only able to spend whatever is available in your account, there's no risk of racking up debt or overdraft fees.


Mogo offers another similar pre-paid product, except instead of getting cashback off of your purchases, you're getting Bitcoin. The company gives 1% cashback in BTC on all purchases and 2% on foreign transactions (however you still are charged the 2.5% Visa foreign transaction fee). To top it all off, for each $1 you spend using your Mogo card, the company will be purchasing 1 lbs of carbon offsets. Its a win-win for both your wallet and the planet!


The company offers a reloadable Mastercard alongside targeted rewards from specific retailers and companies (think Netflix, Spotify, etc.) One of the main perks is they offer free ATM withdrawals, allowing you to withdraw from your pre-loaded balance fairly easily.

All in all, pre-paid credit & debit cards can be a great alternative to traditional credit cards, sometimes offering equivalent (and occasionally superior!) rewards and savings.

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