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Ranking the Credit Card Portfolios of Each Canadian Financial Institutions (updated May 1, 2017)

ByMatt

It has been exactly 6 months since the last time I updated this list. The reason is because there has been very little movement until the past two months, where there were quite a few changes in the credit card industry that warrants an update to the rankings. Last year was a strong year for credit cards, so I assumed that 2017 would be a slow down year anyway. Unfortunately, most of the changes so far to the industry have been negative. Companies that moved down the list is because of a negative change. The ones that moved up is due to the downfall of the other companies.

Hopefully you have as much fun reading this as I do writing it. I really find my ranking system useful when I figure out my personal rewards program portfolio. I compare this to fantasy rankings in sports!

Groupings

Before we get started, even know there is a ranking next to each company, I also grouped them into specific groups. The current ranking is as they are today. The grouping system below is more about their potential:

  • Group 1: Credit card companies with the most well diversified products. They have really separated themselves from the pack.
  • Group 2A: Credit card companies that have the potential to move up to Group 1, but there is currently a large enough separation with their products that they should be in a different grouping.
  • Group 2B: Credit card companies that may actually have a better portfolio than those in Group 2A; however, they do not have the infrastructure to ever move into Group 1. Unless there is a drastic measure, such as a merger with another company.
  • Group 3: Another grouping of companies that provide another significant separation from Group 2.

As a result, you will notice a discrepancy with the rankings from one company to the next.

GROUP 1

Please refer above for the description of this grouping.

1) Toronto Dominion (TD) / MBNA (no change)

TD continues to stay strong, namely because of its co-branded Alaska Airlines and Aeroplan credit cards. I am also a big fan of the Best Western card and some like the TD First Class card. Either way, with so many great choices, they remain in first place!

2) American Express (AMEX) (no change)

AMEX probably has more competitive credit cards than TD, however, because they implemented a once-in-a-lifetime sign up bonus rule (though not technically 100% enforced all the time), they remain in second place. Furthermore, it does not help that AMEX is only accepted at limited retailers.

What keeps them well above everyone else below is their strong referral program, which is unique of its kind in Canada.

3) Royal Bank of Canada (RBC) (last time 4)

The introduction of the RBC Rewards Card is an upgrade over its predecessor, the Gold version. However, this was overshadowed by the devaluation of the Avion program, where transfers to American Airlines decreased from a 1:1 ratio to a 10:7 ratio.

That being said, I think that the Tangerine devaluation hurts more, which by default moves RBC up a spot.

4) Scotiabank / Tangerine (last time 3)

There is no choice but to move Scotiabank down one spot. The devaluation of the Tangerine card is too disappointing. Also, they seem to be slowly shutting down the Sears co-branded credit cards, that they took over from Chase. Some people reported that they were offered to switch their Sears cards to a cash back Momentum card. However, the previous foreign transaction fees waived feature is being taken away.

Scotiabank is definitely on a downward trend at the moment, and if they continue, I may need to drop them out of Group 1. Let’s hope that they turn things around soon, is there a full blown Chase takeover around the corner? Seems like it is heading in that direction…

  • Scotiabank GM Infinite Visa Card
  • Scotiabank Momentum Infinite Visa
  • Scotiabank Scene Visa Card
  • Scotiabank More Rewards Visa Card
  • Scotiabank Gold American Express Card
  • Scotiabank American Express Platinum Credit Card
  • Tangerine Money-Back Credit Card

GROUP 2A

Please refer to the explanation above for the discrepancies in the rankings, as well as the description of this grouping.

5) Bank of Montreal (BMO) (no change)

Nothing much happening with Bank of Montreal. I really do feel that they need to partner with an airline or hotel chain at some point. They rely too heavily on their partnership with Air Miles. And we all know how things are going with Air Miles…

6) Canadian Imperial Bank of Commerce (CIBC) (no change)

CIBC has been doing a great job offering first year fee waived promotions with its Aventura and cash back cards. Nothing much with its Aeroplan cards. Some people may be targeted for a first year fee waived promotion, but you may need to apply in person. I am surprised that CIBC has managed to maintain its partnership with Aeroplan for so long since TD became a partner.

9) National Bank (no change)

National Bank is one of the most frustrating companies to watch. They are the 6th largest bank in Canada, yet they sit 9th overall in this ranking. It does not correlate, which means that they have the potential to do more with their credit card portfolio. I really do believe that they have the resources to offer more, but it just feels like they have no desire for it.

GROUP 2B

Please refer to the explanation above for the discrepancies in the rankings, as well as the description of this grouping.

7) Capital One (last time 8)

Capital One has been very quite, but they move up one spot because of Chase discontinuing new applicants for its Amazon.ca card.

Seems like Capital One is focusing a lot of their energy on promoting the Costco co-branded card. At the very least, if they are not going to introduce new cards, they can upgrade their existing ones to make themselves more competitive. My first suggestion is to offer at least 1.5%, if not 2% cash back, on Costco purchases.

8) Chase (last time 7)

The countdown has started. How much longer will Chase Canada be hanging around? With the discontinuation of the Amazon.ca card (albeit, grandfathered), where do they go from here? Scotiabank full blown takeover? Seems like they have already started taking over some of its operations, like customer service.

For now, I will keep Chase separate and they remain ranked so high because their only credit card is still highly competitive in the industry.

10) President’s Choice Financial (PC Financial) (no change)

If you walk into a Loblaws stores, you have probably been approached with signing up for one of their co-branded cards. However, there is only so much that PC Financial can do when they only partner with one (PC Plus) loyalty company. Oh wait, they actually have a second one! As I have mentioned numerous times in the past, I really hope that they would  offer a co-branded Shoppers Optimum card as well. That also means that they keep Shoppers Optimum around, which is what I would strongly recommend.

12) Desjardins (no change)

From Desjardins onward, I would really only get a card with the company if I was already an existing for some of their other products. In Desjardins’ case, I would only get one of their credit cards if I was a banking client and push them to waive the annual fee. Otherwise, I would move on to other more competitive cards.

GROUP 3

Please refer to the explanation above for the discrepancies in the rankings, as well as the description of this grouping.

11) Rogers Bank (no change)

In line with what I said about Desjardins, as I am a Rogers client, I have the Rogers Bank Platinum MasterCard. Even though it was hit with a devaluation, it is still a competitive card. I put my Rogers bill on it to get the annual fee continually waived. You do also get 4% cash back on foreign purchases. With a 2.5% foreign transaction fee, you are still ahead by 1.5%, which is much better than all the other credit cards out there.

13) Laurentian Bank (no change)

Laurentian Bank does offer two competitive worth mentioning. They really should branch out and partner up with a third party loyalty program to grow their brand. It is not enough to only have internal reward programs.

14) HSBC (last time 15)

I see so much potential with HSBC, but they have yet to impress me. I do hope that they make an attempt to offer a more competitive product. I think that they can handle it, if marketed well.

Furthermore, their Canadian website could use an upgrade. Did you see how they list the features and benefits of their credit cards?

15) Canadian Tire (last time 16)

I have been wanting Canadian Tire to simply team up with a major credit card company, because I still find it odd that they want to stand their own. I guess they like having more control over their product. If it works for them, the I will look at it on the bright side, more competition to the marketplace!

16) Walmart Financial (last time 17)

I will continue to harp on the same issue that I have with Walmart’s only credit card. Let’s see an increase on the cash back received on Walmart purchases. The current 1.25% is pretty dismal. I would like to see 2%, but we can start with 1.5%.

  • Walmart Rewards MasterCard

17) ICICI Bank (last time 14)

After thinking about it, the $49 annual fee on their only credit card just doesn’t sit well with me, so I had to move ICIC to the bottom for the time being. It doesn’t help that the Tangerine card just had a devaluation, so I am currently not expecting much improvement from this card.

6 Comments

  1. The RBC Avion points transfer devaluation to American Airlines is a huge blow to RBC, and a non-AMEX card. This was my wife and I’s go to VISA/MC option, as long with AMEX Premier Rewards. Given the big hit, I imagine we’ll cancel, since BA and Cathay Pacific are distance based awards and really only good for short haul, and BA has huge fuel surcharges which further reduces my want to fly with them.

    Perhaps we will go with the TD Aeroplan VISA Infinite card. If we bump up our checking account with TD the annual fee of $120 is waived.

    Reply

  2. Great Job Matt. I really appreciate the job of summarizing in a post all the options and how the groups are created.
    Thumbs up

    Reply

  3. Thank you Matt. Appreciate the work that goes into such a handy summary.
    If possible I would distance MBNA from TD. I have the Alaska card and the BW from them and their customer service is absolutely the worse to deal with. I wish CC people can learn from the AMEX who is tops in my book for customer service hands down.

    Reply

    1. Just like Tangerine being owned by Scotiabank, I kept them together because there is a parent and subsidiary relationship. MBNA cannot really do anything without TD’s final stamp of approval anyway.

      That being said, I may provide a little more commentary to distinguish the two next time! But I do not think that I would separate them within the rankings.

      Reply

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