RBC Cash Back Mastercard review

How the RBC Cash Back Mastercard earns

The RBC Cash Back Mastercard has two tiers. Grocery store purchases earn 2% on the first $6,000 each year, then 1%. All other qualifying purchases earn 0.5% on the first $6,000 of annual purchases, then 1%. There’s no ceiling on total cash back.

Groceries are where the card earns its keep. A household spending $400 a month at grocery stores spends $4,800 a year, all within the 2% limit, and earns $96 a year from groceries alone. A household spending $500 a month would reach the $6,000 limit exactly and earn $120.

How the tiers play out

Because non-grocery spending starts at 0.5%, the card rewards you more as the year goes on. Once you pass the $6,000 threshold, other purchases earn 1%, the same rate groceries drop to after their own $6,000 limit.

RBC’s terms set out exactly which purchases count toward each threshold and when the tiers reset, so check them if you plan to use this as your only card. For most people, it works best as a grocery card paired with another card for everything else.

The welcome offer

New cardholders can earn up to $70 cash back. The bonus applies to your first $1,000 in purchases within three months, about $333 a month, which is easy to reach with regular grocery shopping. Check RBC’s current terms for how the bonus rate is applied.

For a household spending $400 a month on groceries, the welcome bonus alone would be worth most of a year’s grocery cash back.

Redeeming cash back and other perks

You can redeem cash back any time once your balance reaches $25, rather than waiting for an annual payout. The card includes a complimentary three-month DoorDash DashPass, and at Petro-Canada you save 3 cents per litre and earn 20% more Petro-Points.

Since there’s no ceiling on total cash back, heavy spenders aren’t cut off. Their extra spending simply earns 1% once the $6,000 thresholds are passed.

Fees, interest and the fine print

There’s no annual fee. Purchases in a foreign currency carry a 2.5% foreign transaction fee, so $1,000 spent abroad or with US online stores adds about $25, more than you’d earn back on it.

Purchases are charged 20.99% interest and cash advances 22.99%. Pay your full statement balance by the due date to avoid purchase interest; carrying a balance would quickly outweigh a 2% reward.

Insurance coverage

Insurance is limited to purchase coverage, and there’s no travel insurance. Check the certificate for limits and eligible items.

• Purchase security and extended warranty

Who it suits, and how it compares

The card suits students, newcomers and anyone who wants a no-fee grocery card and doesn’t mind a low starting rate elsewhere. Its 600+ credit score guideline also puts it within reach of people with a short credit history.

The SimplyCash Card from American Express also has no annual fee and pays 2% on groceries and gas, with 1.25% on everything else, though it’s aimed at applicants with a score of 660 or higher and American Express isn’t accepted everywhere. The Tangerine Money-Back Credit Card is another no-fee option, with 2% on groceries as one of its 2% categories.

Of these three, the RBC card makes the most sense if you mainly want a no-fee grocery card with a 600+ credit score guideline and cash back you can redeem whenever you reach $25.

Before you apply

The recommended credit score is 600 or higher, and RBC makes the final decision based on your full credit profile. Confirm the current welcome offer and earn rates on the RBC website before you apply.