Mar

Scotia Bank No Fee Money Back Visa Card Review

Written by Neil Galloway

I have reviewed a couple credit cards and reward programs previously. This was the CIBC Aerogold Aeroplan cards and the BMO Mosaik Airmiles cards. Both have their pros and cons. So decided to look at ScotiaBank's Visa.

This is the bank I am with, but I have never used their credit card. I figure it would be an easy one to review, because its reward feature is easy to calculate.

No Fees

This is the first big plus. No fees. When you have a card with a fee, you need to be spending a certain amount before it pays for itself. No fees card you can leave in the safe for emergencies or not use them for long periods of time without worrying that you are throwing money away.

Reward Feature

Simple. It is 1$ back. For every dollar you spend, you will receive a penny back. It appears like you only receive this once a year however. There are two cards as well. The standard interest rate 19.5% for the "no fees" card and 18.5% for a fee of $8/year. If you pay your card off consistently, you should be fine with the "no fees" card.

How Does This Compare to Other Cards?

In my other articles on Aeroplan and Air Miles cards, I made the assumption that an Aeroplan point is worth about 1.6 cents and an Air Mile is worth about 20 cents.

You can accumluate 1 Airmile for every $15 on the best schedule and 1 Airmile for every $40 on the worst. So this would mean you would get back 20 cents for every 15 dollars down to 20 cents for every $40. This is return rate of 1.3% down to 0.5%. A large variance. You have to remember that you are paying a fee to get those higher returns as well.

UPDATE (March 22, 2007) American Express has an Airmiles card that gives 1 AirMile for every $20 and it is a no fees card. This is a straight 1% return rate if you value an AirMile at 20 cents like me.

Aeroplan points can be received at 1.5 points for every dollar down to 1 point for every $2. I value an Aeroplan point at 1.6 cents. So this would be a return rate of 1.5% down to 0.8%. The same thing applies here as Airmiles. You need to pay a fee to get the better return rate on your money.

Summary

Aeroplan and Airmiles offer better return rates if you are willing to pay the fee and put quite a bit of money through your credit card (to offset the fees). Their rewards pay out monthly (if you choose to use them) where ScotiaBank's visa does not.

UPDATE: (March 22, 2007) If you have the American Express card, it basically matches the ScotiaBank card in rate of return (unless you think an AirMile is more or less valuable than I do).

However, Scotiabank Visa is real money. Not points that can only be used on predefined products. Their visa starts with no fees and give the medium return rate. Without fees, you do not have to worry about putting a lot of money through your card.

I put a lot of money on my mastercard because it is our primary method of paying bills and such, but the ScotiaBank visa looks like the best alternative for those who are unsure what to go with.

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Category: Finance

Original Post: Thursday, March 22nd, 2007

3 Comments

Cynthia Says:
2009-04-03 14:05:57
You've done a tremendous job but I'm still a little confused, especially after reading your comment above, "Without fees, you do not have to worry about putting a lot of money through your card." If you don't charge a lot on your card, then how will you collect (more) points??? Isn't that the whole, er, point? Pardon the pun

Gregory Says:
2009-05-01 15:02:48
The Scotiabank Moneyback card has a tiered based system, like the CIBC Dividend. It is UP TO %1 cashback. So, if you spend below $3000, you get 0.50% or 0.25% for anything below $1500. The TD Rebate Rewards Visa does away with the 0.25% and offers an automatic 0.50% on anything under $3000 but most people spend more than $1500 a year in card purchases. The CIBC has 3 insurance items (at no cost) with the Dividend card, which makes it the best of the three.

Anna Says:
2009-07-07 22:05:22
How about ease of booking flights with Aeroplan and Airmiles and the other Bank point Visas? I know Airmiles is extremely frustrating and they kept mailing and leaving phone messages that they changed our flights after booking even though the airline said everything was as originally planned (Delta). I haven't booked through Aeroplan as it takes forever to get points if you don't fly Air Canada or use the CIBC Aerogold Visa. I do have a Scotia Gold Visa where points cover taxes/fees on any airline and basically work out to 1 cent a point so if you spend $15,000 on your Visa you get 15000 pts = $150 worth towards travel. So you would want to put $12,000 through your card to cover the $120 fee (includes all medical/travel/car rental insurance for family members). Their travel department always been quite helpful on booking flights, fares are basically same as you can book directly with airlines (or hotels for that matter).