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Ranking the Credit Card Portfolios of Each Canadian Financial Institutions (updated August 1, 2016)

ByMatt

It has been a few months since I last updated this list. The reason is because there was no significant shift in the industry until now.

I decided to change up my classifications a little bit. I’ve split up the credit card companies into 4 groupings:

  • Group 1 are the leaders in the industry. They each provide several great products to choose from, so that even if they shut down a product, they won’t be bumped out of this grouping that easily. Furthermore, I will probably cap this group at 5 companies, it is a nice round number!
  • Group 2A are the bubble companies that have enough infrastructure in place to one day bump into Group 1. They just need to beef up their portfolio.
  • Group 2B provide a big enough gap from Group 3, but not enough infrastructure to bump into Group 1.
    • Essentially the main difference between 2A and 2B is their future potential. But I will continue to rank each credit card company based on their current state, which is why you may notice a discrepancy in the rankings.
  • Group 3 are one of two types of companies, they either only offer one product or they don’t have anything significant to talk about. So they will stay put until something changes in their business model.

GROUP 1

*Please refer to the explanation above for the discrepancies in the rankings, as well as the description.

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

As mentioned many times before, TD is really only in this position because they have the companies portfolio with MBNA. Without MBNA, TD would not be ranked first. Unfortunately, MBNA is getting more strict on how many credit card you can have with them at a time. There are reports that you can only have 1 of their credit cards at a time. If the rules becomes even tighter, we may see TD starting to slip down the rankings.

2) American Express (AMEX) (last time 3)

AMEX’s once in a life time sign up bonus policy prevents them from being 1st place. Though they moved ahead of Scotiabank because they offer generous referral bonuses such as AMEX Platinum Card ($699 annual fee and 60,000 sign up bonus points when referred) and the AMEX Business Platinum Card ($399 annual fee and 75,000 sign up bonus points when referred). The AMEX Gold Rewards Card also brought up its referral bonus ($150 annual fee, first year free waived, and 5,000 sign up bonus when referred).

I suspect that American Express and Scotiabank will probably swing back and forth for the time being.

3) Scotiabank / Tangerine (last time 2)

Scotiabank dropped a position mostly because AMEX made an improvement. Overall, I strongly believe that Scotiabank firmly holds down first place in the cash back credit card market. Launching the Tangerine Money-Back Credit Card system wide has pushed their cash back portfolio to the top, especially when you combine it with the Momentum Infinite Visa card.

With the ending of the Tangerine 4% promotion, they have now dropped back to 3rd place for the time being.

I would really like to see Scotiabank begin offering a co-branded hotel or airline credit card in the future.

  • Scotiabank GM Infinite Visa Card
  • Scotiabank Momentum Infinite Visa
  • Scotiabank Scene Visa Card
  • Scotiabank Gold American Express Card
  • Scotiabank American Express Platinum Credit Card
  • Scotiabank Sears Financial Voyage MasterCard
  • Tangerine Money-Back Credit Card

 4) Royal Bank of Canada (RBC) (no change)

We save a few recent promotions (that ended) with the RBC British Airways Visa Infinite and RBC Cathay Pacific Visa Platinum, along with the recent upgrades to the RBC WestJet World Elite MasterCard, which expanded their annual round-trip companion voucher options (with the choice of: $99 for Canada and the Continental United States, $299 for Hawaii, Mexico, Central America and the Caribbean or $399 for Europe). These minor tweaks were not enough to push them into the top 3, but enough to give RBC a firm hold on 4th place.

5) Bank of Montreal (BMO) (no change)

BMO has been pretty good at giving promotions with their existing credit cards. But if they don’t add anything new to their portfolio, or make some permanent positive changes to their existing credit card portfolio, I can’t make an argument to move them up the rankings. That being said, they are doing enough to remain the top 5. Granted the main reason is because the credit card companies ranked below haven’t done much to improve.

GROUP 2A

*Please refer to the explanation above for the discrepancies in the rankings, as well as the description.

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

Even though they are considered one of the big 5 banks, they still have some work to do. It is not so much that their portfolio is bad, because they do have some decent choices, it is more the fact that the competition is better. The question to CIBC is, are you content with where you are? Because you obviously have the infrastructure to push!

9) National Bank (no change)

Even though Capital One and Chase currently rank higher than National Bank, they actually have a high chance of propelling themselves upward because of their infrastructure. They are technically the 6th of the big 6 banks. If National Bank introduces a few more competitive products, I have no problem moving them up to 6th place. But they have a long way to go before entering the top 5.

12) Desjardins (no change)

According to their ranking, they should really be in Group 3. However, they also have the infrastructure to launch into Group 1. They offer both MasterCard and Visa cards. All they are missing are more competitive products that really stand out of the rest.

For now, they offer a few standard products, which keeps them at the bottom of Group 2A.

GROUP 2B

*Please refer to the explanation above for the discrepancies in the rankings, as well as the description.

7) Capital One (no change)

Capital One has some strong credit cards in their portfolio, but they don’t have the infrastructure to ever go into Group 1. The main reason is that they only offer credit cards in Canada, they do not have any other source of income. Their services are also virtual based, no in person service, so they have limited resources. That being said, American Express is in the top 5, so who knows, anything can happen!

8) Chase (no change)

They are in the same boat at Capital One. The main reason they are ranked just 1 position below Capital One is because they only have 2 products in their entire portfolio. Albeit, both products are highly competitive. Unfortunately, it does not seem like they have any current plans to expand in Canada. I am more afraid that they will sell off their client base to a big bank and close up shop. They already sold their Sears portfolio to Scotiabank. We will see what happens to the rest of the existing clients.

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

In my last report, I mentioned that PC should probably not be in Group 2, but now with the 2A and 2B system, they slot nicely in this position. They offer two competitive products, but not enough infrastructure to ever launch into the top 5. With the discontinuation of the RBC Shoppers Optimum MasterCard. It will be interested to see what happens to the Shoppers Optimum program. Will it be merged with PC Plus? Would PC Financial introduce a co-branded Shoppers Optimum credit card? One can hope!

GROUP 3

*Please refer to the explanation above for the discrepancies in the rankings, as well as the description.

11) Rogers Bank (no change)

With the addition of the Fido MasterCard, Rogers Bank definitely solidified its position at the top of this group, and also inching closer to President’s Choice, but not quite there. However, with a slight devaluation to the Rogers Bank Platinum MasterCard almost balances it out. Glad to see that there is an expansion in their credit card portfolio!

13) Laurentian Bank (last time 14)

Laurentian Bank is in for some tough competition. There is already Desjardins, who is Quebec specific, along with National Bank (who focuses more energy on Quebec), so I can’t expect too much out of them. That being said, the addition of the Laurentian Bank Visa Dollars definitely contributes to the cash back competition, so they move ahead of HSBC.

14) HSBC (last time 13)

The HSBC Premier MasterCard is actually a decent product that sometimes offers a nice promotion. So they have the potential to shake things up, they just need to take a little risk and come out of the shadows. I would like to go on record that I am cheering for HSBC specially. I really would like to see them grow in Canada.

15) Canadian Tire (no change)

Not much we can say here. Personally I actually rather Canadian Tire team up with one a financial institution to offer a co-branded credit card instead. I really don’t see the purpose of offering their own credit card and incur all the costs associated with supporting this product. Unless their credit card is THAT profitable?

16) Walmart Financial (no change)

With Walmart phasing out Visa credit cards, Walmart’s only credit card becomes that much more prominent. I wouldn’t use the same argument with Walmart as I did about my recommendation to Canadian Tire.

Walmart is so big that they are just going to do their own thing. I just hope that they can offer a more competitive product, because there is some potential here. Keep in mind that Target offered a co-branded credit card with RBC, offering 5% cash back on Target purchases. That might have been too generous to be profitable, but if Walmart bumped up to at least 2.5% (half of Target) on Walmart purchases, you will probably see this credit card in my wallet. Until then…

  • Walmart Rewards MasterCard

6 Comments

  1. But why do I, the consumer, care how each bank’s portfolio rates against the other banks’ portfolios?

    Reply

    1. An example is that it gives you an idea on where to shift your business to. Let’s say you want smaller banks to survive to keep the competition alive, then don’t give any of your business to the top credit card companies.

      Reply

  2. Is see that the AMEX business Platinum still offers the 75k… And for “only” 399$.

    Question : if I already have the personal Platinum and want to get this one as well, where do the MR points “go” ? For instance, if I make a travel purchase on my personal Platinum, can I both access the personal AND business MR pts to reimburse my speeding ? And should I jump on that 75k asap before it goes the way of the personal card ?

    Reply

    1. Yes, you would pool your points into one account, so long as you are the primary cardholder on both.

      I would not tempt fate on an offer. It can end at any time without notice.

      Reply

  3. Pretty much sum up the options available to us. Great summary of the portfolio for each bank.With Air Miles expiration I think BMO will not longer be on the top in the ranking

    Reply

    1. That’s a really good point Santiago. I will take that into consideration when I update the list in the future!

      Reply

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