Cancelling a credit card in Canada is straightforward, but there are steps to follow carefully to protect your credit score, redeem outstanding rewards, and ensure no lingering charges. Here’s the complete process.
Before You Cancel: Checklist
- Redeem or transfer all rewards points — Most programmes cancel unredeemed points when you close the account
- Pay the balance in full — You cannot cancel a card with an outstanding balance
- Cancel or move all pre-authorized payments — Subscriptions, utilities, and automatic payments linked to the card will be declined after cancellation
- Confirm the balance is $0 — Request written confirmation from the issuer
Step-by-Step: How to Cancel a Credit Card in Canada
Step 1 — Redeem your rewards Check your rewards balance and redeem everything possible. With most programmes:
- Cash back — Request as a statement credit or cheque before closing
- Scene+ / Aeroplan / Avion — Points typically stay in your programme account even if you close the card (verify with each programme)
- Amex MR — Points are tied to the card; closing the card forfeits unredeemed MR points unless you hold another MR-earning Amex card
Step 2 — Update pre-authorized payments Log in to every subscription and service billed to this card and update the payment method. Common ones to check:
- Streaming (Netflix, Spotify, Amazon Prime)
- Insurance premiums
- Utility providers
- Phone/internet bills
- Gym memberships
- Any regular online subscriptions
Step 3 — Pay the full balance Your final statement may include annual fees or interest. Pay the entire balance and wait for it to clear before cancelling.
Step 4 — Call the issuer Call the number on the back of your card or on the issuer’s website. Request to close the account. The agent may offer:
- A fee waiver (if you’re cancelling due to the annual fee)
- A retention offer (bonus points or credits to keep the card)
- A product change (downgrade to a no-fee version)
Consider these offers — downgrading to a no-fee version of the same card keeps your credit history intact at zero cost.
Step 5 — Get written confirmation Ask for a confirmation number and email confirmation that the account is closed with a zero balance. Keep this for your records.
Step 6 — Cut up the physical card Destroy the old card to prevent accidental use.
Step 7 — Verify on your credit report Within 30–60 days, check your Equifax and TransUnion reports to confirm the account shows as “closed” with a zero balance. If it shows differently, contact the issuer.
How Cancelling Affects Your Credit Score
Cancelling a credit card can temporarily lower your credit score in two ways:
1. Credit utilisation increases If you carry balances on other cards, removing this card’s credit limit raises your utilisation ratio. Example: $2,000 balance across $10,000 total credit = 20% utilisation. Cancel a card with a $3,000 limit: $2,000 across $7,000 = 28.6% utilisation — higher score impact.
2. Credit history length may shorten If this is one of your oldest accounts, closing it can reduce your average account age over time — a minor negative factor.
Impact is typically small for established credit files. For newer credit users (under 3 years of history), the impact can be more significant. If in doubt, downgrade to a no-fee version rather than closing outright.
Should You Cancel or Downgrade?
| Situation | Recommend |
|---|---|
| Card has a no-fee version available | Downgrade — keeps history, removes fee |
| Card has no no-fee version | Cancel if you don’t use it, but consider timing |
| It’s your oldest account | Downgrade or keep — don’t close if you can avoid it |
| You’re applying for a mortgage soon | Wait — score changes before a mortgage application are risky |
| Card is charging an unused annual fee | Downgrade or cancel — no reason to pay for a card you don’t use |
Annual Fee Waiver: Ask Before Cancelling
Before cancelling due to the annual fee, call the retention line and ask for a fee waiver or retention offer. Banks spend significant money acquiring cardholders — they often provide:
- Full or partial annual fee waiver
- Bonus points (often $100–$200+ in value) to keep the card
- Statement credits
This works best if you’ve held the card for 1+ years and have regular spending on it.
Related Articles
- Credit Card Annual Fee Waivers in Canada
- How Credit Scores Work in Canada
- How Hard Inquiries Affect Your Credit Score
- Credit Card Basics — Canada Guide
- Best No Annual Fee Credit Cards in Canada
Rewards forfeiture policies vary by programme. Always verify your programme’s specific cancellation policy before closing a card. See our Advertiser Disclosure.