Credit cards are the most powerful tool for earning points and miles in Canada.
They also play a big role in your credit score.Using cash or debit will not build your score, but responsible and regular credit card use will.
Used wisely, cards help you grow your score and unlock the best credit card offers. Used poorly, they can lower your score and block approvals.
This guide explains how credit cards affect your credit score in Canada, what factors matter most, and how to use them to your advantage.
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Fuel your adventures with points
Signup to get expert guidance and the latest Canadian points and miles tips. Learn how easy it is to travel more for nearly free.
The AWP Newsletter
Fuel your adventures with points
Signup to get expert guidance and the latest Canadian points and miles tips. Learn how easy it is to travel more for nearly free.
Payment History
Payment history is the most important part of your credit score.
Missing a payment, even for only $10, can lower your credit score and disqualify you from future welcome bonuses. Paying your card balances in full and on time is the best strategy.
Learn more in our guide on managing credit cards responsibly and check your credit score.
Top Offers
Wondering which credit card to get next?
Check some of the best credit card offers in Canada.
Top Offers
Wondering which credit card to get next?
Check some of the best credit card offers in Canada.
Credit Utilization
Utilization is how much of your credit limit you are using.
High balances compared to your limits will lower your score, even if you pay on time. Try to keep balances below 30% of your total available credit.
Paying down cards before the statement closes can also improve your reported utilization.
Length of Credit History
Lenders prefer long, stable histories. Closing your oldest card can shorten your history and lower your score.
AWP TIP
Make your oldest no fee card a keeper, even if you rarely use it. This helps maintain your average account age and strengthens your credit score.
New Credit Applications
Each new card application creates a hard inquiry. This may lower your score by a few points temporarily.
With responsible use, your score will recover and often rise higher than before.
Pace your applications and apply when you have a plan to meet the minimum spend. Check out our guide on meeting minimum spending without overspending.
Points Beginner’s Guide
From points newbie to booking your first trip.
Learn how easy it is for Canadians to earn points. Choose the best credit cards and programs. Make your first redemption for almost free travel.
Points Beginner’s Guide
From points newbie to booking your first trip.
Learn how easy it is for Canadians to earn points. Choose the best credit cards and programs. Make your first redemption for almost free travel.
Bottom Line
Credit cards help you develop a healthy credit score when used responsibly.
Pay on time and in full, keep balances in check, and pace your applications. Responsible and regular credit card use will build your credit score over time, while using cash or debit will not.
Use your cards wisely. They will reward you with valuable travel points and a stronger credit score, , and access to the best credit card offers.
