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Credit Card Battle: BMO Preferred Rate MasterCard vs. American Express Essential

While personal finance experts universally recommend avoiding a credit card balance, sometimes there’s no other choice. Whether an emergency hits, a series of car repairs drains your emergency fund, or a work expense is slow to be reimbursed, most Canadians have carried a balance on their credit card from month to month at one point or another. In fact, according to the TransUnion Insights Report, Canadians carried an average credit card debt of $3,954 in the third quarter of 2016.

When this situation strikes, the interest charged on most credit cards can add up fast. But there are low interest options if you find you must carry a balance. In fact, low interest credit cards provide a viable alternative if you carry a lot of debt.

Here’s a quick comparison of two of the best low interest credit cards in Canada: The BMO Preferred Rate MasterCard the American Express Essential Credit Card.


1Interest rate increases if you do not make your minimum payment by the payment due date and have not paid it by the date BMO prepares your next statement two times in any 12-month period.

BMO Preferred Rate MasterCard

  • Featured

    BMO® Preferred Rate MasterCard®

    Welcome Offer: Get a 0.99% introductory interest rate on Balance Transfers for 9 months with a 2% transfer fee and we'll waive the $29 annual fee for your first anniversary

Card details

  • Annual fee: $20 (rebated for the first year)
  • Low interest rate of 12.99% on purchases and balance transfers, 15.99% on cash advances
  • Zero dollar liability, plus free purchase protection and extended warranty

The BMO Preferred Rate MasterCard has a $20 annual fee and charges an interest rate of 12.99% on purchases and balance transfers as well as 15.99% on cash advances. This credit card offers extended warranty and zero liability coverage for fraudulent purchases.

If you were to carry a $1,000 balance on the BMO Preferred Rate Mastercard for six months, you’d pay $59.50 in interest charges, plus the $20 annual fee for a total cost of $79.50.

American Express Essential Credit Card

The American Express Essential Credit Card does not have an annual fee and has a lower interest rate. This credit card also offers travel accident insurance, zero liability, purchase assurance and extended warranty.

Flickr: Eli Christman

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