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Tag: credit history

  • Balancing personal and financial goals as you build a new life in Canada – MoneySense

    For many newcomers to Canada, personal and financial goals can feel like they are pulling in opposite directions. You want to say yes to everything—travel, dinners out, live music, social events—but you’re also thinking about building an emergency fund, saving for retirement, and staying out of debt. Add to that the cost of settling in, a limited credit history, and (in many cases) living off savings or a survival job, and it becomes clear that trying to do it all right away can be risky.

    This article isn’t about me, but I will say this: my family and I chose to focus on building a strong financial foundation before chasing all the extras. At the same time, we were very aware of how easy it is to fall into the trap of grinding so hard that you lose steam. If the journey to build a better life becomes joyless, it can be hard to remember why you moved in the first place.

    You can’t do everything at once—and that’s okay

    The truth is that it’s hard to prioritize when you’re trying to settle in and feel like you belong. The urge to do and see everything is real. But when your early days in Canada are being funded by personal savings—or worse, high-interest credit—impulsive spending can get dangerous fast. 

    Without a financial plan, it’s easy to overspend—and because newcomers often have no credit history, the only credit products available may come with steep interest rates and strict limits. One misstep can quickly spiral. Instead of trying to do everything, consider what really matters most in the short term. What helps you feel grounded? What creates forward momentum? What is truly urgent, and what can wait?

    Focus on the foundation

    There’s a difference between building a life and decorating it. In those early months, start with the essentials—the things that give you stability, reduce your stress, and set you up for long-term success.

    Earning, saving and spending in Canada: A guide for new immigrants

    Here are a few financial goals that are worth tackling early.

    1. Build your credit history

    Get a secured credit card, if necessary, and use it for manageable expenses like phone bills or groceries. Pay it off in full every month. This helps you build a strong credit profile, which will eventually open doors to lower interest rates and better financial products.

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    2. Set up an emergency fund

    Even if you’re starting small, building a financial cushion gives you breathing room. Try to set aside enough to cover one month of basic expenses, and grow it over time.

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    3. Understand the Canadian financial system

    This includes learning the difference between TFSAs, RRSPs, RESPs, and more. Many financial institutions, community organizations, and nonprofit agencies offer newcomer-specific resources. Take advantage of them.

    Compare the best TFSA rates in Canada

    4. Avoid high-interest debt

    Unless absolutely necessary, avoid payday loans or quick-cash offers. These products often have extremely high interest rates and can lead to long-term financial stress. If you are unsure, ask questions. Get advice before you borrow.

    5. Make small progress on long-term goals

    Even small, regular contributions to your child’s education fund or your own retirement savings can have an outsized impact over time. The key is to get started.

    But don’t put life on hold

    Now here’s the important part: building a financial foundation does not mean you have to live a joyless life. You didn’t move here to just pay bills and build spreadsheets; you moved here for something more. And if you strip away everything fun or fulfilling in the name of discipline, you may find yourself questioning whether the move was worth it.

    What helped me was learning to make room for both—a night out every now and then, a concert ticket, a staycation with my family. Nothing extravagant, just moments that reminded us that we were here to live, not just survive.

    If you plan for it, joy doesn’t have to be expensive, it just needs to be intentional.

    A quote that changed my perspective

    I recently saw a quote on Instagram that stayed with me:

    “Your life will change when you realize you are not building wealth for the things you can buy. You are building wealth for the problems you won’t have. The emergency that doesn’t devastate you. The opportunity you can take. The pressure you don’t feel. Wealth is peace, not possessions.”

    Vickram Agarwal

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  • How your rent payments can help build your credit history – MoneySense

    Rent reporting can help boosts credit scores

    “Your rent is your biggest monthly obligation for debt payments so it’s unfair that it’s not counted towards building your credit,” said Viler Lika, founder and CEO of rental services company SingleKey. 

    Companies like SingleKey, Zenbase, Borrowell, and FrontLobby offer such rent-reporting services, with varying fees and requirements. SingleKey works with landlords and property managers across Canada and screens more than 15,000 rental applications every month. Landlords pay a $30 fee for a tenant screening report, and renters pay $8 per month to report their rent payments on the SingleKey platform.

    “This is a very powerful tool for graduating towards home ownership as a renter because you’re demonstrating to the lender that you have the ability to pay a large amount,” Lika said. 

    The platform accommodates pauses in rent reporting too—when you might move back in with your parents, for example—without harming your credit. 

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    Rent reporting isn’t risk-free

    Lika believes rent reporting will make housing more accessible for renters while also reducing tenant delinquency risk for landlords. However, Alex Leduc, CEO and principal broker of Toronto-based mortgage brokerage firm Perch, cautions that such disclosure can come with its own set of concerns. “If [you] stop reporting, it would be a red flag to lenders and they would dig deeper,” he said. “And if [you] keep reporting and arrears show on [your] credit report, then [your] credit score would likely go down as a result.”

    Leduc advises against opting into a rent-reporting program if you anticipate missing a payment or even paying a few days late. “Otherwise, you’re just shining a light on a poor repayment history that would’ve potentially gone unnoticed,” he said.

    However, Leduc believes rent reporting can be beneficial especially for longtime renters, new immigrants, or aspiring homebuyers with little or no credit history. “Not having a credit score is a massive impediment to getting credit at all,” Leduc said. “When you’re trying to get a mortgage, you’re ultimately asking a lender to give you hundreds of thousands of dollars … They want to know you’ve managed credit successfully before.”

    He said there are three key components to preparing a mortgage application: credit score, down payment, and income. And while a down payment can often be resolved—by receiving gifted funds from family, for example—having poor credit can be a “deal breaker.”

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    Understanding credit ratings and scores

    Money Mentors CEO Stacy Yanchuk Oleksy said credit ratings and credit scores are often misunderstood.

    A credit rating is given for each of your credit products. It’s based on a scale of one to nine, with one being the best (meaning you’re at least making minimum payments on your credit card, for example). As you miss payments, you go up the scale. A credit rating of nine would indicate a debt in collection or even bankruptcy.

    All of this information contributes to your credit score—a three-digit number from 300 to 900 that’s used as a predictor of how likely you are to pay back your debts. The higher the score, the more “credit worthy” you are.

    Oleksy ,who is also a certified credit counsellor, said there are often misconceptions about what builds and harms your credit score. Being granted a high credit limit on your credit card, for example—even if you pay it off in full every month—can actually be disadvantageous, she said. “When your credit score is calculated, it looks at all that available credit and says that’s debt because [theoretically] you could go out to town tomorrow [and spend it].”

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  • How bad access to credit keeps newcomers from getting ahead – MoneySense

    According to a 2025 TD survey, 92% of newcomers understood the importance of building credit before arriving in Canada. Yet 82% of those who applied for credit faced immediate barriers. For many, these challenges go beyond inconvenience. They directly affect immigrants’ ability to secure housing, buy a car, start a business, and simply build a life in Canada.

    This isn’t just about money. It’s about inclusion. And if Canada sees immigration as important to its future, then removing systemic financial barriers must be part of the national conversation.

    A cultural shift, and a credit wake-up call

    Like many immigrants, I arrived in Canada financially stable. But the Canadian financial system didn’t recognize that.

    I grew up in India and the Middle East with a simple rule: never buy what you can’t afford. Credit cards weren’t necessary, loans weren’t encouraged, and financial independence meant living within your means. That worldview shaped my early adult life—until I met my wife, who was born and raised in Ottawa.

    I remember one of our early conversations while we were still living abroad. She was confused about why I booked flights through a travel agent. The answer was simple: I didn’t have a credit card. And I didn’t feel like I needed one. To her, this was strange; in Canada, a credit card is a default tool for everything from booking travel to building rewards points. For me, it felt like a way to buy things I couldn’t afford. We weren’t arguing, just coming at the problem from different cultural angles.

    Eventually, I applied for a credit card and, like many people who didn’t grow up using credit, I abused it at first. It felt like free money, but that illusion wore off quickly. Over time, I developed a healthy relationship with credit: using it for convenience, managing payments responsibly, and collecting points for purchases I would have made anyway. When we eventually moved to Canada, all of that learning felt like it didn’t matter anymore.

    Earning, saving and spending in Canada: A guide for new immigrants

    Credit history doesn’t travel

    Here’s a truth most newcomers know, but few are prepared for: your financial history doesn’t follow you.

    Despite arriving with a strong financial foundation, I couldn’t qualify for a meaningful credit limit. My first Canadian credit card had a limit of $200, barely enough for half a Costco run. It wasn’t that I had a bad credit score. I didn’t have one at all. And building one from scratch took years.

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    This wasn’t just a minor inconvenience. It affected every part of our lives.

    We couldn’t get a mortgage, not because of our income or how much we had saved for a down payment, but because of a lack of credit history. When we finally did qualify, we had been in the country for years and had done everything right: on-time payments, healthy credit utilization, excellent scores in the 800s. But still, I wasn’t seen the same way the system viewed my wife, who had been born and raised here.

    Even now, after more than six years in Canada, my access to credit remains restricted. I don’t get offers for balance transfers, lines of credit, or automatic credit increases like she does. Why? Because she has decades of history, and I don’t. The system rewards longevity, not responsibility.

    Harder than it should be

    The TD survey confirms what I experienced. Among newcomers:

    • 31% qualified only for credit limits too low to meet basic needs
    • 27% struggled to secure housing
    • 24% couldn’t save or invest for future goals
    • 66% worried about their Canadian credit history
    • 79% found it difficult to start building credit at all

    That last stat is crucial. Building credit isn’t just hard, it’s systemically difficult for immigrants. And that’s the problem.

    Even though 92% of newcomers say building credit is important, they’re often left without the tools to do it effectively.

    Yes, the financial services industry is beginning to acknowledge the unique needs of newcomers, but acknowledgment isn’t enough. It’s like going to a doctor who finally understands your symptoms but doesn’t have a treatment. Empathy without action is still inaction.

    If Canada wants newcomers to succeed, we need more than empathy. We need solutions.

    Vickram Agarwal

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  • Omniwire Launches New Credit Builder Debit Card 

    The innovative card provides financial institutions with a safe and accessible option for consumers to build or improve their credit history.  


    NEW YORK, November 12, 2024 (Newswire.com)
    –
    One-third of young Americans do not have a credit card and, without that basic financial tool, struggle to build a credit record and the economic advantage and security it provides. Omniwire, a leading next-generation fintech company, provides a simple yet powerful solution: Credit Builder, a debit card that allows users to build a credit history without the use of credit cards and without incurring debt.

    Omniwire is the developer and provider of secure, cloud-based core banking, issuer processing and card issuing services that enable financial services, fintechs and enterprises to go to market quickly and efficiently. Credit Builder is Omniwire’s revolutionary product for opening financial opportunities to people otherwise excluded because of a limited credit history.  

    “Omniwire’s Credit Builder is more than just another card. It is a way for people to take control of their financial futures and enter the modern economy,” said Omniwire CEO Serge Beck. “We’ve partnered with major credit bureaus and full-service community banks to deliver a product that makes it easier than ever for people to build credit securely, efficiently, and confidently.”  

    Omniwire’s Credit Builder combines the functionality of a debit card and bank account with the strategic advantage of growing credit history. Every relevant transaction is reported to one of the three major U.S. credit agencies as a credit activity, allowing users to build a record of on-time payments and to build or improve their credit scores without incurring debt. The Omniwire Credit Builder card operates on the global Visa network, allowing transactions everywhere Visa is accepted.  

    Younger generations in particular can benefit from the Omniwire Credit Builder. The U.S. Federal Reserve reports that only 65% of Americans ages 18 to 29 have a credit card. The Fed study also found that about one-third of all people who apply for any form of credit are either denied or approved for significantly less credit than requested – and that percentage has grown about 7% in the last two years.  

    Omniwire’s Credit Builder is a barrier-free entry to building credit, accessible to consumers across all financial backgrounds, and represents a significant opportunity for financial institutions to expand financial inclusivity and their client base.  

    For more information about Credit Builder, please visit https://www.omniwire.com/credit-builder. To learn more about Omniwire, please visit https://www.omniwire.com.   

    About Omniwire    
    Omniwire is a leading next-generation fintech company specializing in core banking, issuer processing and card issuing services. Its comprehensive suite of secure, cloud-based, patented technology streamlines processes and drives improved efficiency, providing clients with seamless integration and aggressive go-to-market strategies.  

    Source: Omniwire

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  • How to build credit history in Canada – MoneySense

    How to build credit history in Canada – MoneySense

    How to get a credit card in Canada

    Well, you apply. But make sure you’re applying for the right card and that you have a high chance of being approved. You see, the credit card company will check your credit history, and that can affect your current credit score. So, don’t apply for a bunch and hope for the best, as that could make it look like you are at risk for having access to too much credit. The good news: There are many types of credit cards in Canada, including those for newcomers to Canada, students and even those with bad or no credit. Check out our rankings for the best credit cards in Canada for your situation.

    Once you have a credit card you will want to maintain good credit habits, like paying it off on time and paying more than the required minimum payment. Here are some other articles that will help you navigating your first credit card in Canada.

    Read:

    Why is credit history important?

    Say you want to rent an apartment. Your credit history is vital because most landlords will want to see your credit score and credit report to judge whether you’ll pay your rent on time. If you get the apartment, you’ll want an internet connection—and for this, too, the large providers will query your credit score.

    If you need to buy or lease a car, your credit history will not only determine whether you’re approved for a loan, but also what interest rate you’re offered: the higher your credit score, the lower the interest rate. Insurance companies may check your credit history before providing coverage. And finally, if you want to buy a home, your credit history is key to qualifying for a mortgage, as well as what mortgage interest rates lenders will offer. A lower rate could save you tens of thousands of dollars over the life of your mortgage.

    Read:

    How to build a good credit history when you have no credit history

    Credit history is usually built organically as people start using credit. In Canada, young people who have reached the age of majority (18 or 19, depending on where they live) can apply for a credit card and start building a history of borrowing and repayment.

    If you’re a newcomer to Canada, or if you’re a student, recent grad or young adult who doesn’t have much of a credit history, your credit score may be low—which is a hurdle in getting approved for credit. It’s a frustrating cycle—you need credit history to access credit, and you need credit to build that history. So, what’s the solution? Here are a few steps anybody can take to build their credit history:

    Aditya Nain

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  • What happens if you don’t use your credit card? – MoneySense

    What happens if you don’t use your credit card? – MoneySense

    If you find that you no longer need the credit, review any potential closure fees before deciding to cancel the card, too. Instead, you could look into downgrading the card, transferring balances, or using the card at least once a year for a small purchase to keep the account active.

    The impact of dormant cards on your credit rating

    Letting a credit card go dormant can impact your credit score in a few ways. As noted above as a con, if you don’t use a card for a long time, your credit issuer might close the account, which reduces your total available credit limit. For example, if your total credit limit drops from $10,000 to $8,000 with the account closure but your spending remains at $2,000, your utilization ratio rises from 20% to 25%. A higher ratio can negatively affect your credit score because it suggests you’re using more of your available credit.

    Having a mix of different credit types—such as credit cards, student loans, mortgages and car loans—helps maintain a healthy credit score. If a card is closed, you lose some of this diversity, which can also impact your score.

    Consistent on-time payments are crucial for maintaining good credit. Even if a card is dormant, missing payments can damage your score. To avoid this, pay more than the minimum payments on your credit cards and make all payments on time, every time. 

    It is important to review your credit report and score at least once a year to make sure there are no errors. You can obtain your credit report and score through Canada’s two credit bureaus, Equifax and TransUnion, a third-party service, or your bank’s website or mobile app. Even without any errors, regularly checking your report can help you better understand how your financial habits can affect your score and helps you see ways to improve it and manage debt better.

    Should you ever stop using your credit card?

    If you’re worried about letting your credit card go dormant, there are a few alternatives. Consider transferring balances from other credit cards or look at downgrading and switching to a no-fee version of the same card. Both of these options keep your account open and your credit utilization ratio low.

    You can also keep the card active by using it occasionally for small purchases, setting up a small recurring charge on it, or making it your go-to card for a regular expense, like buying gas. This helps keep your account in good standing without much hassle.

    How many credit cards is too many?

    There isn’t a set rule for how many credit cards Canadians should have in their wallets. The number of credit cards that is right for you depends on what you can afford to spend and pay back on time. Remember, it’s not just about the number of cards you have, but how responsibly you use them. 

    Sandy Daykin

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  • How to use your credit card responsibly – MoneySense

    How to use your credit card responsibly – MoneySense

    What is a credit score?

    A credit score is a three-digit number, usually between 300 and 900, that banks and other lenders use to determine how likely you are to pay back your loans. The higher the number, the more credit-worthy you are to the banks.

    Your score is based on information in your Canadian credit history, such as whether you pay for your phone bill and utilities on time and in full each month. The problem is, for newcomers and others without a Canadian credit history, lenders don’t have any information. This makes it hard for people to get credit.

    Your first credit card in Canada

    If you’re young, or a newcomer, or you haven’t used credit in Canada before, you’ll need to start simply. Credit cards themselves are forms of credit, so the first step is to get an entry-level credit card and prove your credit-worthiness by paying your bills on time. Then you can work your way up.

    Entry-level credit cards usually have fewer perks than more premium cards, but they also typically have lower income requirements and a lower annual fee—in some cases, $0.

    National Bank’s mycredit Mastercard is a great example. There’s no annual minimum income requirement to apply for this card and no annual fee, making it very accessible. And, while the mycredit Mastercard doesn’t come with a full suite of included benefits, it does allow you to earn 1% cash back on recurring bill payments and restaurant spends, and 0.5% back on everything else.

    If you want more features and rewards, National Bank’s Platinum Mastercard is a good option that also has no minimum income requirement. National Bank’s World Elite Mastercard has an annual fee of $150 and comes with more perks—including an annual travel expense refund up to $150.

    4 tips for credit card use

    You already know you should use your credit card responsibly, but what, exactly, does that mean?

    • Stick to your budget
      Most entry-level credit cards come with modest credit limits. Still, it’s important you don’t spend more than you can pay off, no matter your limit. This is sometimes tricky for new credit cardholders, but budgeting is an essential part of your financial health.
    • Pay your card balance in full
      Best practice is to pay off your credit card, in full and on time, every month. Interest rates on credit cards are very high, so debt can balloon quickly if you carry a balance. Stick to your budget and don’t overspend.
    • Pay the minimum amount
      If, for any reason, you can’t pay a bill in full, make sure you pay at least the minimum amount, which appears on your bill. Credit card companies report your payment history to the credit bureaus, and even one missed payment will lower your score. You can avoid that by making the minimum payment (or more) by the due date.
    • Pay your bill on time
      Timeliness is as important as making minimum payments. It shows the credit bureaus that you can meet your financial obligations. If you need help remembering your due date, consider setting up an automatic payment through your online banking. 

    When it comes to credit cards, you should work towards paying in full, on time, every month. Every payment helps you build your credit score buy showing you are responsible with credit, and over time, you can become eligible for upgraded financial products, with more features and perks.

    Keph Senett

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  • What happens if you get rejected for a credit card? – MoneySense

    What happens if you get rejected for a credit card? – MoneySense

    Having a delinquency on your credit report can also make it more challenging to get approved for a credit card as banks see you as a high-risk applicant. Whether you’ve missed a payment or experienced a financial setback that led to your debt going to collections, having a delinquency on your record can significantly impair your credit score and make it very hard to get approved for most credit cards. So, if you do have a delinquency on your report, work to resolve the issue and settle any amounts in collections before applying for new credit.

    5. You’ve applied for a lot of credit recently 

    Applying for several credit cards in a short time can be a red flag. Lenders can view this as a sign of desperation for credit and worry that you’re borrowing more than you can handle, which could affect your ability to make the minimum payments. 

    In addition, every new credit-card application generates a hard inquiry that will lower your credit score. Hard credit inquiries account for 10% of your credit score so it is important to only apply for new credit products you need, one at a time. If you’re rejected for a credit card, wait between three and six months before reapplying to limit the impact of hard inquiries. 

    6. You have too much debt 

    If you already have a lot of debt through loans, mortgages and high credit-card balances, opening a new credit card could be seen as a warning sign to lenders that you are having problems paying down your existing balances. They might flag you at a higher risk of defaulting and reject your application. 

    When it comes to assessing your creditworthiness, lenders focus not just on the amount of debt you owe, but also look at how much of available credit you’re using. This is known as credit utilization, which makes up 30% of your credit score. Try to keep your utilization under 30% of available credit for maximum positive impact on your score. For example, if you have $10,000 in total credit available to you, try not to carry a balance of more than $3,000 at any given time. This shows lenders you can manage your credit responsibly.

    7. There’s an error on your credit file 

    If you’ve been turned down for a credit card (even if you have an excellent credit score), but have no debt and a clean payment history, it’s worth checking your credit report for errors. Incorrect payment details could be affecting your credit score—and, in turn, your eligibility to get approved for new credit. 

    You can identify this by reviewing your credit report regularly to see what’s documented and make sure the information is correct. For no charge, you can remove incorrect information by filing a dispute directly with the credit bureau.

    8. You don’t meet the age requirements

    In Alberta, Saskatchewan, Manitoba, Ontario, Quebec and Prince Edward Island, you must be at least 18 years old to obtain credit. In all other provinces and territories, the minimum age is 19. If you don’t meet these age requirements, your credit card application will automatically be denied, so hold off until you are eligible. 

    Doris Asiedu

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  • What does opening or cancelling a credit card do to my credit score? – MoneySense

    What does opening or cancelling a credit card do to my credit score? – MoneySense

    To close a credit card, the balance is $0. If there’s a substantial balance on the remaining cards, it’s going to increase the credit utilization ratio. And, if the increase is high enough, it will hurt your credit score. This is because the closed card’s unused credit limit no longer provides balance in the relationship between your other credit balances and credit limits. What you owe elsewhere can have a bigger impact than if you had a zero-balance credit card.

    Another thing: Closing an account means the creditor will stop reporting on your behalf your credit history on that card. If the card showed positive credit history, such as responsible usage and making payments on time, that history will gradually fade away and no longer bolster your credit score. 

    The reverse can’t be said. If the card showed negative credit history, closing the account will not erase the negative impact on your score. 

    Generally speaking, cancelling a credit card won’t improve your credit score, and you shouldn’t close a credit card unless you have a good reason, such as not trusting yourself to use the credit responsibly.

    Buyer beware: Welcome offers

    Many credit cards come with a generous sign-up bonus that helps you earn cash back, points, miles or a reduced interest rate. Welcome offers can be a great way to save money, especially if you already had planned on spending the minimum threshold to earn them. However, proceed with caution. 

    Read the fine print. Despite the enticing welcome offer of a credit card, your credit score may drop when you apply for a new card as a hard inquiry will be performed during the application process. Although your credit score will only drop a couple of points and will likely recover after a few months if you make your payments on time, it’s still a hit to your credit.

    Remember that welcome offers are one-time deals. While some credit card sign-up bonuses may save you money up front, the reality is that any rewards you earn aren’t worth incurring additional bills if you’re already struggling with debt. You should only consider a new welcome offer if you have paid off your credit card debt in full. If you have any debt, focus on paying that down—not short-term wins like getting a lower and very temporary interest rate.

    Opening and closing credit cards can impact how you use credit, too. Open multiple new cards, and you may end up with more credit than you can feasibly handle or keep track of. In addition, the allure of welcome offers may distract you from your financial goals. There’s impact on your credit score, and it’s critical to think about how having more or less credit affects your ability to live within your means and pay off your debt in full each month.

    Doris Asiedu

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