PERSONAL FINANCE BLOG

Money shouldn´t stop making your plans come true. Learn how personal loans can help you!
BMO Cashback Card Basics
22 Sep 2019

The Basic BMO Cashback Card Is the Perfect Beginner Cashback Card

It’s always a satisfying feeling to get money back just for shopping with your credit card. Out of the many cash back card options out there that you could use to do this, the BMO Cashback card is one of the more modest ones. Even students, new Canadians and low-income people who might have trouble getting other cards can try this one out to see what it’s like to have their credit card paying them for a change.

Learning More About the BMO Cashback Mastercard

The BMO Cashback Mastercard is an extremely simple basic cash back card. It’s free and available to nearly anyone with a little regular income and a fair credit score, and will sometimes be given to people with no credit score at all. When you charge purchases to it, you’ll receive 1% cash back on anything you buy. There are no bonus categories and no limits on how much you can earn in any given month; it’s just a flat 1% coming back to you at all times. This rate is slightly low considering that there is no way to increase it outside of the introductory offer (see below), but it it’s close enough to the average rate you’ll be able to get at this level that it doesn’t matter much. If anything, many people might like the fact that it is easy to understand how much you’ll have coming to you in rewards for each bit of spending you do.

There are a few benefits that come with this card, too. You’ll get a discount of up to 25% off car rentals from National Car Rental or Budget Rent a Car locations, plus 15-20% off Cirque de Soleil tickets depending on where you are attending the show (you’ll have to go all he way to Vegas for the highest discounts). These promotions are nice to have, but many people will never even have the opportunity to use them, and many more will rent cars and see shows without necessarily remembering that they could have done so for less by using their discount. This means that while it’s difficult to say that these benefits are out-and-out worthless, you shouldn’t expect to get too much value out of them either. They’re just a few extra small things to sweeten the deal for you.

The BMO Cashback Welcome Offers

Anyone who chooses to get this card for the first time will currently also benefit from a few bonus offers that BMO is running. The first is a boosted rewards rate that will let you start your experience with cash back cards off with a bang; you will receive an incredible 5% cash back on all purchases in the 3 months immediately following until you hit $100 in rewards – after that, you’ll be bumped back down to the 1% rate no matter how much of the 3-month time frame you have left to go. It’ll only take $2,000 in spending over those three months to hit that limit, or approximately $667 a month to break it down even further. That’s not very much if you charge most of your expenses to the card, so many people will be able to use this offer to the fullest and start out with an extra $100 to their name by the end of this welcome period. That’s not bad for an entry-level card that forgoes most of the other fancy features some other cards have.

What if you already have a big balance sitting on another card, though, and don’t want to keep racking up more debt on this one just to enjoy that welcome bonus? In that case, you’ll probably be more interested in the other offer that BMO has for new BMO Cashback Mastercard applicants. You could be paying a measly 1.99% on balance transfers for the 9 months immediately after you get your card – that rate is approximately one-tenth of what you would be paying otherwise, whether you kept that debt on a standard card or transferred it to this one when you didn’t have this offer active. You can imagine just how much that could let you save, especially if you’ve built up a debt of hundreds or even thousands of dollars.

A Variety of Ways to Redeem BMO Cash Back Rewards

You might think there’s only one way to redeem cash back rewards on credit cards, but you’d be wrong; the BMO cash back system actually offers its customers 3 different ways to get their cash. You can deposit the amount into a BMO chequing or savings account, apply it as a credit to your monthly statements, or put it into an Investorline account (again, with BMO). Regardless of which of these 3 you choose, you have to redeem your rewards in increments of $50 or more. If you have less than that accrued, you’ll have to wait to claim your cash.

While all of these options more or less amount to the same thing, it’s great to be able to have so much control over the form your rewards take. That flexibility allows people to choose the method of redemption that best suits their financial habits. People who like to save will love the idea of putting the money straight into investments, where they can watch it grow over time and become something substantial with the rest of their savings. People who are prone to splurging or using their credit card a little too liberally might like to put their rewards toward paying off that debt fast before it can cost them more money in interest fees. The rest can simply deposit their new money straight into their bank accounts and spend it however they wish.

You Have Little to Lose With the BMO Cashback Mastercard

As we’ve made clear from the start, the BMO Cashback card is far from a luxury credit card option and there are far better cards on the market for those that want them. That being said, those other cards mostly have much more exacting requirements. This card instead excels at being a realistic option for the average Canadian to use to try out a cash back system. Its simplicity makes it even more suited to this task. No matter who you are, you shouldn’t have much trouble using this card to get a modest sum of money back in your bank account by the end of the year.