Tangerine’s No-Fee Cash-back MasterCard – The New Cash Back King?

   (Editor Rating)

Tangerine No Fee Cash Back Mastercard

Tangerine MasterCard Rating
  • Annual Cost
  • Cash Back
  • Benefits & Rewards
  • Customer Service
4.9

Review Summary:

Tangerine’s no-fee MasterCard may very well be the best no cashback card in Canada. No other card offers this kind of comprehensive package of rewards and benefits to its clients.

Even though not applicable to Costco, and not recommended for those who run up a balance due to its high interest rates, this card is absolutely great value.

Pros

  • Best rewards & benefits in the market
  • No limit on rewards
  • 100% free to use

Cons

  • Not applicable to Costco
  • High interest rates if you run up a balance

This is a guest post by credit card enthusiast and regular reader –  Elbyron

tangerine money back credit card

Tangerine has recently announced a new no-fee cash-back credit card which is expected to quickly become one of the most popular cards in Canada. In addition to having one of the best reward systems I’ve ever seen, it boasts a wide range of features, and a lower than usual foreign exchange fee.

This card almost seems like it was specifically designed to appeal to MBNA Smart Cash cardholders who are fed up with the limits and inflexibility. It’s reward structure is similar, but is improved over Smart Cash in many ways.


Rewards

  • Earn 2% cash-back on purchases in up to 3 categories of your choice, with NO MAXIMUMS.
  • Earn 1% 0.5% cash-back on all other purchases (also no maximum).
  • The reward is automatically redeemed monthly.
  • Choose to get a statement credit or a deposit to your Tangerine Savings account (excluding TFSA).

If you choose the statement credit for your redemption, you get to pick 2 categories for the 2% cash-back. If you choose the deposit to a non-registered Tangerine savings account (either sole or joint account holder), then you get to pick a third category.

You can change your categories to suit your spending: once initially set, the categories can be changed every 90 days. The changes take effect on the next monthly statement date after current categories have been in effect for 90+ days. Which category a purchase falls under depends on the merchant, not the item you purchased. So if you buy pharmacy items from your local grocery store, they will actually count as Grocery, not Drug Stores. Conversely, if you bought food from Shoppers Drug Mart, it goes under Drug Stores and not Grocery.

The current categories are:

  • Drug Stores: Merchants classified as “Drug Stores/Pharmacies”.
  • Restaurants: Merchants classified as “Eating Places, Restaurants, Bars, Lounges, Discos, Nightclub Taverns and Fast Food Restaurants”.
  • Entertainment: Merchants classified as “Sports Venues, Theatres, Amusement Parks, Carnivals, Circus, Tourist Attractions and Exhibits, Movie Theatres, Zoos, Bands, Orchestras, Aquariums” .
  • Furniture: Merchants classified as “Home Furnishing Stores, Furniture Reupholstery” .
  • Gas: Merchants classified as “Service Stations” .
  • Grocery: Merchants classified as “Grocery Stores and Supermarkets” .
  • Home Improvements: Merchants classified as “Hardware Stores, Home Supply Warehouse Stores, Lawn and Garden Supply Stores, Glass/Paint/Wallpaper Stores, Florist supplies nursery stock & flowers, Floor Coverings, Drapery and Window Coverings”.
  • Hotels: Merchants classified as “Lodging, Hotels, Motels, Resorts or by Property name” (i.e. Fairmont, Marriott, Holiday Inn, etc.) .
  • Public Transportation and Parking: Merchants classified as “Automobile Parking Lots and Garages, Public Transportation (including Buses, Trains, Ferries), Taxis, Road Tolls” .
  • Recurring Bill Payment: Recurring bill payments are defined as payments made on a monthly or other regular basis, and which are automatically billed by the merchant to your Tangerine Money-Back Credit Card, such as your monthly phone bill. Not all merchants offer recurring payments, and not all ongoing payments will be considered “recurring payments” for purposes of this category. Please check with your merchant to see if your recurring payment qualifies.

Unfortunately, no Costco but…

Because Costco categorizes themselves as “Discount Stores” (5310), they will not qualify for any of these categories. However, Costco gas stations are correctly categorized as Gas. Walmart.ca is also a “Discount Store”, but their Supercenter stores are usually “Grocery”. Online merchants like Amazon or eBay likely won’t qualify either. There is currently no categories for electronics, flights, fitness (except recurring membership costs), medical, liquor, contractors, insurance (unless recurring), jewelry, and many other high-spending categories. But we can always hope that they’ll add more in the future!

You can request additional cards for up to 5 authorized users, but your 2 or 3 category choices will apply for all of them. All the cards accumulate cash-back, but the primary cardholder receives all the rewards to their chosen destination. Your significant other could just get their own card with different categories, but they wouldn’t be linked and you would have two bills to pay.

Cost

  • No annual fees;
  • No cost for additional authorized users (up to 5);
  • 19.95% interest rate;
  • With an interest rate of 19.95%, this is not a good choice of credit card for carrying a balance, as there are other cards in the range of 7 – 10%. Also note that even if you choose to get your cash-back as a statement credit, this does not reduce the minimum payment amount (just your total balance).

Benefits & Features

  • 90-day purchase assurance (theft/damage/loss);
  • Double manufacturer’s warranty up to 1 extra year;
  • Ability to setup online travel notifications;
  • Pause-my-card feature, in case you temporarily misplaced your card;
  • Customizable alerts: you can be notified of every purchase, if you want;
  • Automatic pay-my-balance: pre-authorized withdrawals from any chequing; and,
  • Online credit limit adjustments.

Most of these features are starting to become common-place, but there doesn’t seem to be many cards that offer all of them. Tangerine also has a well-designed and easy-to-use website, plus they are known for pushing the envelope on new online banking features.

Cash While Travelling

Another potential use for this card is obtaining foreign cash while out-of-country. The flat $5 out-of-Canada cash advance fee means that if you withdraw a large enough amount at once, you can get cash for a fairly cheap rate. For example, withdrawing $1,000 CAD worth of the local currency from an ATM would cost you $5 (0.5%) plus a 2.5% fee over MasterCard’s excellent base rate. This is likely to be cheaper than most other methods of obtaining foreign cash, but there is a catch: unlike other purchases, interest will begin accruing immediately on the cash advance, until the day you pay off the balance.

Fortunately, there is a simple trick to avoid paying any interest on the advance: first pay down any current balance, then make a payment for an additional amount to cover the cash you want to withdraw, plus $5 for the fee, plus a little extra to account for fluctuations in the exchange rate. When you go to withdraw from the ATM, you already have a positive balance, which gets used to immediately pay for the cash advance, and therefore no interest is charged. This isn’t really a “trick”, as all credit card companies apply over-payments towards future purchases. It works with pretty much any card – just be aware of the foreign exchange fees and cash advance fees.

How it Stacks Up

There are lots of no-fee cash-back cards available, but only one other – MBNA Smart Cash – offers rewards as high as 2% on select categories. However, the 2% bonus on Smart Cash is restricted to gas & groceries and only applies to the first $400 of each month spent in those categories. Furthermore, unless you upgraded to the World version of Smart Cash, even the 1% is limited to a $1,250 monthly spending cap. (not available anymore)

The fact that Tangerine’s card has no limit on the rewards will seem very appealing to those who would normally exceed those limits. However, it should be noted that those who spend over $5,000 per year on their credit cards may be better off with a premium cash-back card with an annual fee, depending on how much you spend in your 2 or 3 highest spending categories.

At the other end of the spending spectrum, those who only charge small amounts to this card will automatically give you all your accumulated cash-back every month. It is quite clear that Tangerine’s new card is designed to beat Smart Cash and become the new cash-back king!

How to Get It

You must be 18 years old, but there is no minimum income requirement on this card. Right now, this is the best free cash back credit card in Canada.  

Guest Blogger

This is a guest post. You can read more about the author in the biography above.
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Richard
4 years ago

Anybody out there with a suggestion…
I run a small expedite cross border delivery service and will spend approx. $55,000 in fuel and vehicle related items.
Need a credit card for 3 drivers under the business .
Have a personal Capital One (CDN) but restricts business use and I need to change over to a card with cash back provision.
Open to your recommendations .Thanks

FT
4 years ago
Reply to  Richard

Richard, have you taken a look at the Scotia Momentum Visa? It offers 4% cash back on gas purchases. https://milliondollarjourney.com/scotia-momentum-visa-infinite-card-review.htm

smayer97
4 years ago
Reply to  Richard

First I would like to say that for that kind of spend, you are mostly likely better off with a fee-based premium Cash-back card, because the spend will more than offset the fees and you will be farther ahead.

Second, the cards discussed on this site have been for consumer customers. Don’t recall much discussed for business use. That said, here are some of my recommended cards, in order of preference for your usage.

MBNA Rewards World Elite Mastercard. 2% cash-back on all expenses, no cap, $89/yr fee, no extra cost for additional cards.

Laurentian DOLLARS VISA-2% cash-back on gas (& groceries), 3% on pre-authorized recurring charges, 1% on all else, no cap. $65/yr + free additional cards

Scotiabank Momentum Infinite Cash Back Visa – 4% on gas (& groceries) with $25K spend limit, 2% on pre-authorized recurring charges with $25K spend limit, 1% on all else, no cap. $99/yr + $30/each additional cards (so $90 extra for the 3 you need).

All have 1st yr refunded feature.

You can read about the first and third ones here: https://milliondollarjourney.com/top-premium-cash-back-credit-cards-in-canada.htm

I do not know if they offer these for businesses, so you would have to inquire.

HTH

smayer97
4 years ago
Reply to  smayer97
Luc
4 years ago

I have received my credit card with limit 3000 CAD. Not bad for student, and FREE saving account. Unfortunately in Canada we should to pay for daily banking.

FrugalTrader
4 years ago

My understanding is that there is no minimum income requirement, just that you need to be at least 18 years old.

andy
4 years ago

What is the minimum annual income requirement to get a Tangerine credit card?

nobleea
4 years ago

This card is going to come in handy right quick. Almost finished building our house and we are going to be getting a fair amount of furniture, fencing, landscaping, etc etc. Conveniently, all probably purchased over a 3 month period which coincides with their signup bonus. Having no maximums on the categories means we can probably get $600 cash back in a short time.

smayer97
4 years ago

Just a quick post so I can get updates to this discussion thread
(wish there was a way to subscribe without leaving a comment)

Paul
5 years ago

The best thing about this card is just seeing the cashback deposited to my savings account every month.

JC
5 years ago

Just an FYI, MBNA Smartcash has direct deposit to your next Statement (go green save paper and stamp plus get your money sooner)… just go to your rewards login page and turn it on… they will pay you more than the $50 cheque to whatever your cash back balance is once it hit’s the minimum $50 rewards. ie. my last statement MBNA credited my account with $69.78

Bruce
5 years ago

Lots of choices. Have been using my CIBC Dividend card since it first came out. Think it was the first Cash Back card but it’s now behind the curve. Now use my Capital One MC Costco card and Think I will supplement with Tangerine.
Since we are now retired we spend 5-6 months in the US so what I now need it a Cash Back card in US $ offered by a Cdn company. Been using the CIBC US card for $35 p/a but no cash back. Anybody got suggestions?

Tom
5 years ago
Reply to  Bruce

The RBC Black Visa (U.S.) is linked with the Canadian RBC Visa although cash rewards, if switched back onto the Canadian card, can only be applied to a Visa payment and at 1/2 the number of $ transferred. So $5000 earned on your US Black Visa would result in a transfer of $2500 to be applied to a Visa payment. Less than ideal.

Neha Sharma
5 years ago

I guess, Some CC won’t allow you to overpay or prepay.

Elbyron
5 years ago
Reply to  Neha Sharma

Is that just a guess, or can you actually provide an example of such a credit card?