How to Apply For a Credit Card in Canada?

Navigating credit card applications can seem overwhelming. On one hand, there are eligibility requirements to consider, and on the other, you must gather all the necessary information. Moreover, it’s crucial to keep in mind the potential impact on your credit score if you aim to maintain a good rating.

Despite the numerous considerations, there’s no need to worry. Armed with a basic understanding of credit card applications, the process of selecting and applying for your credit card can become a straightforward endeavor.

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This article is designed to walk you through the credit card application process, making it easier for you to get started!

Credit card eligibility

To qualify for any credit card in Canada, certain criteria must be met. Initially, you need to be a Canadian resident, meaning you possess citizenship, permanent residency, or refugee status in Canada, and you must have reached the age of majority in your respective province or territory.

Additionally, it’s essential to have a Canadian credit report. Credit card issuers assess your credit score during the application process, so it’s advisable to check your credit score for free beforehand to avoid potential rejections. Some financial institutions may also stipulate that you haven’t declared bankruptcy within the last seven years.

If you’ve ticked off the boxes on this checklist, you’re in great shape. You are now well-prepared to select the credit card that aligns with your specific needs.

Things to consider before your credit card application

There are hundreds, if not thousands, of credit cards on the Canadian market. Make an educated decision on which one to apply for. This way, you can avoid getting one that doesn’t fully suit your needs or, even worse, getting rejected.

Before starting a credit card application, I recommend you consider things such as:

The card’s interest rate for purchases, cash advances and balance transfers
The annual and/or monthly fee
Rewards, cash-back and discount perks
Required income for eligibility
The grace period
Insurance included (travel, car rental, and other)
The fees for foreign exchange (FX), over-limit, automated teller machine (ATM) withdrawals, etc.
Cost for additional cards/authorized users
User experience, company values and customer service

If you don’t know where to start in the plethora of available options, a credit card comparison tool might be just what you need!

You found the right credit card? The next steps are proving that you meet the requirements, providing government-issued identification and consenting to a hard credit check.

What you’ll need to apply for a credit card

It is time to gather the necessary documents to complete your application. The required documents for your credit card application may include employment letters, salary slips, a list of the other credit cards you have, and a summary of your assets and liabilities.

Each card issuer may have slightly different application processes based on risk profiles and internal procedures. To apply for a Scotiabank credit card or loan, for instance, you need to provide the following.

Please also note that this is just a guide. I recommend reading up on the requirements for the specific credit card you’re applying for beforehand in order to avoid any mishaps.

How to apply for a credit card?

Depending on your chosen financial institution, there may be several different ways you can apply for a credit card. Let’s briefly go over each option.

In-person (branch) applications

In-person applications are usually available with Canada’s traditional, big-five banks (TD, RBC, BMO, CIBC and Scotiabank) and credit unions. This is primarily because these institutions have branches for in-person banking, whereas digital-only banks and less traditional lenders may not.

If you are applying for your new credit card in person, do your research before walking into the branch. If you don’t have the required documents or information, you may have to return at a later date.

In-person applications may be a convenient way to apply for those who don’t consider themselves very tech-savvy or have questions about the application process. This way, the teller will be able to walk you through the process, answer your questions and submit the application for you.

Over-the-phone applications

You may also have the option to apply for your credit card over the phone. In such applications, the teller will walk you through the process and confirm your identity before starting the application. They will then ask for your personal details, including your address, social insurance number (SIN) and employment status.

When you apply for a credit card over the phone, you may have to send certain documents later on, either physically or electronically, such as copies of your driver’s license or an employment letter.

Online applications

Applying for a credit card online is usually quick and easy, taking somewhere between 15 to 60 minutes in total. Some credit card providers, such as American Express, also make it a point to give you a decision on your application in a matter of minutes, simplifying and speeding up the process even further (see below!)

Online credit card applications require you to input all of your details on your own. If you have questions or are stuck, you can hop on a call with a customer service representative for clarification.

What to do after your credit card application

Hearing back on your credit card application may take anywhere from just a few minutes to 30 days. On average, however, most applications take about one week to finalize.

If your credit card application has been approved

If your credit card application has been approved, congratulations! The next steps are to wait a few days to receive your new credit card in the mail. The last thing to do is to activate it.

You can activate your new credit card by calling the toll-free number on its back or logging onto your digital banking. Once you do this, you’re ready to go!

Don’t forget that most institutions will require you to insert the card into a point-of-sale (POS) machine the first two times you use it. If the card has contactless payment capability, it will usually activate after the third transaction.

If your credit card application has been denied

But what happens if your application is denied? First, don’t fret. While there may be several different reasons as to why this happened, it is likely that you still have other options.

If the financial institution hasn’t already given you a reason for their rejection, you can contact them to learn more. If the issue was your credit score, I recommend that you explore credit card options for rebuilding your credit score. Otherwise, consider credit cards that are easy to get, such as the ones that accommodate lower annual incomes or more limited credit histories.

Final thoughts on credit card applications

There are approximately four steps to a credit card application: choosing the appropriate card, gathering your documents, completing the application and then taking the necessary post-application steps based on the issuer’s decision.

Once you become familiar with how credit card applications work and the different types of credit cards available to you as a consumer, this is a relatively straightforward process. We just recommend that you carefully minimize the effect on your credit score, as each hard credit check that results from an application can lower your credit score by a few points.

FAQs About How to Apply For a Credit Card

Can you cancel a credit card application?

If your credit card application is not yet processed, you may have the option to cancel it online or by calling a customer service representative at your given lender. You cannot, however, cancel your credit card application after you’ve been approved. If you do not want the credit card you have applied for, you will have to cancel the credit card itself.

Can you include parents’ income on credit card applications?

No, you cannot include other people’s income on your credit card application, even if they are your parents and will support you in paying your statement balances. If your parents pay you a consistent monthly allowance, you can include this money as part of your income based on the lender’s discretion.

What documents do you need for a credit card application?

You will need government-issued identification, your social insurance number, proof of income and a summary of your assets and liabilities to apply for a credit card. It is also necessary that you consent to a credit check during the application process.

Do credit card applications affect your credit score?

Credit card applications themselves do not affect your credit score, but the hard credit check you consent to in your application does. Generally, this impact is quite low (only a few points), and you can recover from it by upkeeping your credit-friendly habits over the following months (as you always should be!)
Suppose you are, however, consistently applying for new credit cards (or other types of credit, such as loans or mortgages) for whatever reason. In that case, the cumulative effect on your credit score will be more prominent.

How long should I wait between credit card applications?

There is no prescribed amount of time that you should wait between credit card applications. While it is better that you wait as long as you can, we recommend that you do not apply for more than one credit card within the span of 90 days. If you can hold off, consider waiting about six months.

Is a credit card application a hard inquiry or a soft inquiry?

A traditional credit card application results in a hard credit inquiry. Prepaid or secured credit cards, on the other hand, usually only require a soft inquiry. Soft credit inquiries are less detrimental to your credit score.

Should I put “student” or “employed” on my credit card application if I am both?

You may be better off putting “student” on your application as this may give you eligibility for student credit cards with more preferable terms, a lowered annual income requirement and fewer fees. At the end of the day, however, the decision is up to you.

What counts as income for credit card applications?

Any direct payments you receive (and don’t have to pay back) can count as income for credit card applications. Your income sources may include employment or self-employment earnings, investment income, government or pension payments, income from a spouse or partner, allowances, scholarships, grants, bursaries, or trust fund payouts.
Your income may be in the form of cash, direct deposits or cheques. Borrowed money (such as lines of credit or student loans) does not count as income for credit card applications.

Why has my credit card application been declined?

There can be many different reasons why your credit card application was declined. However, some common reasons include having a low credit score, not meeting the annual income requirement, having an unstable income, having limited credit history (common for newcomers or youth), or having a high outstanding credit balance.
If you’re unsure why your application got declined, I recommend reaching out to the lender to learn more. This way, you can take the appropriate steps to remedy the situation or look for more suitable options.

Will a credit card application rejection affect my credit score?

Getting rejected for a credit card does not negatively affect your credit score. What does affect it, however, is the hard credit check done by the lender in the application process.
If you’re rejected for a credit card and immediately apply for another through a different lender, the effects of multiple inquiries can add up. As such, we recommend waiting at least 90 days between applications, if not more.

How long do credit card applications stay on my credit report?

The credit inquiry that results from a credit card application can stay on your credit report for about two years. The negative effect on your score, however, will be negligible after one year.

How long does a credit card application usually take?

The application process for a new credit card can take between 15 to 60 minutes, while the decision process afterwards may take a few minutes to a few weeks.

Why is my credit card application taking so long?

A decision on your credit card application may take up to 30 days. While the long turnaround time may be related to the status of your application, the lender may also have an overwhelming number of applicants or may be experiencing other issues on their end.
After 30 days, you may consider reaching out to the lender regarding the status of your application.

How many credit card applications is too many?

There is no magic number for credit card applications. You are free to apply for and have as many credit cards as you like.
It is, however, a good idea to keep in mind that the credit checks that result from credit card applications hurt your credit score. As such, more than one application within the span of a few weeks may be detrimental to your credit score and be considered “too many.”

What happens if I lie on a credit card application?

We highly, highly recommend that you do not lie on your credit card application, as doing so may result in serious consequences that hinder your ability to get credit again for a long time. In addition, lying on your credit card application may be considered fraud and potentially result in fines or jail time.