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More debit cards offering rewards

Gail Johnson
Pay Day
The U.S. Consumer Financial Protection Bureau is set to propose new rules to protect consumers using prepaid debit cards, according to a report in the Wall Street Journal.

In the credit-vs-debit debate, credit often gets points because of all the rewards on offer: the more you spend, the closer you are to that trip or at least to that espresso machine. The drawbacks to consumers, of course, are high interest rates and the risk of debt accumulation.  There’s a new trend emerging to encourage people to use money they already have in their bank accounts: rewards debit cards.  

“With a credit card, it’s very easy to overspend,” says Caroline Hubberstey, Interac Association’s head of external affairs. “We have more credit cards now than we’ve ever had. Now more and more financial institutions are offering incentives to use debit.”

CreditCards.com estimates that Canadians each own, on average, 2.9 credit cards, based on data from the Canadian Bankers’ Association and Statistics Canada. According to a recent BMO Annual Debt Report, credit-card debt accounts for 52 percent of the average Canadian household’s debt load.

Here’s a look at some of the rewards debit cards available today; expect to see more in the future.

PC Financial No Fee Bank Account

Points mean free groceries and Joe Fresh Style clothes. You earn five PC points per $1 spent on at participating stores where President’s Choice products are sold. If you set up direct deposit for your paycheque or pension to your no-fee account, you get 10,000 points.

The account comes with free unlimited Interac Debit and Flash purchases, transfers between accounts, bill payments, and withdrawals at any PC Financial or CIBC bank machine.

BMO Air Miles Debit Card

You get one Air Miles reward mile for every $30 spent, up to a maximum of 50 air miles per month, or 600 reward miles a year. If you maintain a minimum monthly balance of $3,000, you get an additional 50 reward miles per month.

The monthly fee is $13.95.

Scene ScotiaCard

Here’s a debit card geared specifically to film buffs: everyday debit purchases rack up points that can be redeemed for free movies.  You earn one point for every $5 spent using the card, and one point for every $1 spent at Cineplex Entertainment theatres.

A new partnership with Sport Chek means you get one point for every $1 spent at the sporting-goods store.

The signing bonus is up to 2,000 points, which translates to two free movies.

RBC Shoppers’ Optimum Bank Account

Chances are you’re familiar with Shoppers’ Drug Mart Optimum card, its in-store rewards card; this debit card ramps up the potential to accumulate points.

You earn five points for every $1 in purchases anywhere you shop. When you shop in-store, you get 10 points for every $1 in eligible purchases, and those are on top of the 10 points per $1 you get by presenting your Shoppers Optimum loyalty card.

The monthly fee is $10.95, which includes unlimited debit transactions, and there’s a bonus of 50,000 points (equivalent to $85) for signing up.

Target RedCard Debit Card

Linked with your own bank’s debit card, this one allows users to save five per cent on purchases at Target stores across Canada.