KOHO credit card review

Quick overview of the KOHO Mastercard

Not too long ago, it felt like Canadians were stuck with only a few options for their everyday banking needs. These included the bank with the comfy green chair, the one that wants you to believe you’re richer than you think, another that loves to tell you it’s the biggest in the country, and a bank that’s named after one of our favourite Quebecois cities. Oh, and one more whose name is really more like a four-letter word. 

Nothing against any of these banks; I, myself, have used – or still use – the products and services of three of those “Big Five”. They’re tried and true and recognizable – with them, you know what you’re getting. However, these days, the options are growing. And competition is always a good thing. 

Enter: the Canadian fintech scene (short for financial technology), which is rife with challengers keen to take on the standard household names. They include Wealthsimple, Questrade, EQ Bank, Neo and KOHO, just to name a few. 

It’s this last one that we’ll talk about today: KOHO. But, first, a caveat/disclaimer/whatever you want to call it. I used to work for KOHO, have freelanced for KOHO and still own shares in KOHO (one of the perks of working for a startup). I’m also a KOHO customer – and this combo makes me perfect to tell you everything you need to know about one of Canada’s leading fintechs (just don’t call them a challenger bank: they don’t seem to like that). 

Is the KOHO Mastercard a credit card or a prepaid card?

First, some housekeeping. The KOHO Mastercard is a prepaid card, not a credit card — you spend money you've loaded into your account rather than borrowing it. Still, it offers a few credit-card-like features that make it an interesting option to consider. For starters, KOHO gives you the option to build credit with its credit-building program, something you don't typically see on a prepaid or debit card. Second, eligible members can access a cash advance of up to $500 through a paid Cover bundle, which starts at $2 a month. The limit isn't guaranteed and depends on your account history, so not every member will qualify for the full amount. Eligibility criteria and Terms and Conditions apply.

Who is KOHO for?

There are several types of people who would benefit from using KOHO. The first and most obvious is anyone who has become fed up with the big banks. Maybe they find the accounts too expensive, the products impersonal and the innovation lacking.

New Canadians also make up a large portion of KOHO users. For them, coming to Canada and building credit can seem like a mountainous task. Features like credit building allow those with no Canadian credit profile to build their history each month.

Anyone who is interested in earning cash back and interest, but prefers to do that without using a traditional credit card, would also find KOHO beneficial. 

Finally, anyone who has had difficulty in the past with budgeting might find a home with the fintech. KOHO gives users monthly insights on their spending, access to a financial coach, and features like RoundUps and The Vault, which help to automate savings and take the work out of building a nest egg. 

Why KOHO is great for newcomers to Canada

KOHO is a great option for newcomers because it offers tiered plans — including the $0-a-month Core plan — so there's something for every budget, along with savings tools, cash back and Credit Building. You don't need a minimum balance or credit history to open an account or start building credit, which makes it ideal for those new to the country.

Pros and cons

What Is KOHO?

KOHO is, at its core, similar to a bank. It offers three plans — from the $0-a-month Core plan to the premium Everything plan — and each one comes with perks tied to the KOHO Prepaid Mastercard, which is issued by KOHO Financial Inc. Regardless of the plan you choose, you'll use a prepaid Mastercard for all your everyday banking needs.

That said, KOHO isn't a bank — at least not yet. The company is pursuing a federal banking licence and raised $130 million in June 2026 to help fund that effort, but the licence is subject to ministerial approval.

Unlike a traditional bank, KOHO doesn’t have any physical branches – they’re digital first (well, digital only, to be more precise). 

In addition to a spending and savings account, KOHO also has a number of features to help you with your finances: From building your credit history to budgeting and earning cash back. More on these products and features a little later.

How KOHO works

KOHO isn't a bank or a credit card — it's an app and a prepaid Mastercard that aims to offer the best of both worlds. It's a flexible option for saving, spending and budgeting, earning cash back and offers tools such as:

• Credit building for building your credit history
• Cover, a paid bundle that gives eligible members access to a cash advance of up to $500 (eligibility criteria and Terms and Conditions apply)
• RoundUps for automatically setting aside a set amount for savings each time you spend
• Savings goals for helping you set and reach savings targets
• Monthly spending insights
• Crypto trading, with a 0.5% trading fee on all plans 

So, there’s really something for everyone. As for me, I’ve been an Extra customer (back when that plan was called Premium) as well as an Easy user (now discontinued). I used my KOHO account in tandem with a traditional bank account. The difference was my bank account was used for all my bills and short-term savings, while my KOHO account was used for spending. 

Having the accounts separate really helped me stay on budget, so I would never go over my allotted bi-weekly funds. I loved the RoundUps feature (saving a total of $224 in a year) as well as cash back (earning a total of $235 in a year). As an Extra user, I also took full advantage of no foreign exchange fees whenever I left the country, relying on my KOHO card for the majority of my local spending (along with cash for the times when cards weren’t accepted).

How you use your KOHO account is up to you! Maybe you’ll use it solely to build credit, share finances with a family member, earn cash back or even as your everyday account. Since it does lack some of the features you get with a traditional bank account, like access to tellers, a full suite of financial products like mortgages and insurance and the ability to wire money and exchange funds for foreign currencies, KOHO might work best as an add-on to a standard bank account.

KOHO Plans

The KOHO Mastercard is an interesting prepaid option because it lets you select the rewards, interest rate on your balance and other features based on your chosen plan. Currently, KOHO offers three plans: Core, Extra and Everything. Every plan comes with a free 30-day trial.

A quick note on interest: To earn it on any plan, you have to opt in to Earn Interest. Rates are variable, calculated daily and paid monthly, with no minimum balance. Once you opt in, up to $100,000 of your money is eligible for CDIC protection; KOHO accounts that aren't earning interest aren't eligible

Core ($0/month)

The Core plan comes with 1% unlimited cash back on groceries, transportation, food & drinks, plus 2% variable interest on your balance when you opt in to Earn Interest. There's no monthly fee, so this is a solid choice for anyone who wants to try KOHO, build credit or earn a little cash back without paying for a plan. Additional benefit:

• Earn up to 6.5% extra cash back at select merchants

Extra ($12/month)

Extra offers 1.5% cash back on groceries, transportation and food and drinks, 0.25% cash back on all other purchases and 2.5% variable interest on your balance when you opt in. It also comes with no foreign transaction fees and your first international ATM withdrawal free each month. This account is for the traveller, who can take their card worldwide and tap as much as they'd like without racking up those pesky forex fees.

Everything ($14.75/month)

The gold standard. The platinum package. The luxurious option for the big spender and saver. Everything comes with 2% cash back on groceries, transportation and food and drinks, 0.5% cash back on all other purchases and up to 3.5% variable interest on your balance when you opt in. It also includes 50% off Credit Building, no foreign transaction fees and a free monthly credit report. Additional benefit:

• Cash back and interest on a joint account

How the KOHO Mastercard plans compare

Not sure which KOHO Mastercard plan is right for you? Here's how the three plans compare:

KOHO Prepaid Rewards

Earning rewards

Earning rewards with KOHO is simple and straightforward. Each account plan has a set amount of cash back you earn in various categories. You’ll earn cash back on those purchases and be able to view your balance directly in the app. 

Redeeming Rewards

Redeeming rewards is just as easy. Open the account, tap “cash back”, tap redeem and voila. You’ve just deposited some extra cash directly into your account, instantly. 

Rewards potential from KOHO partners

In addition to the spending categories, you can earn up to 6.5% extra cash back at select merchants on any plan. The list of partner merchants and their rates changes regularly, so check your KOHO app for the most up-to-date offers.

KOHO Prepaid key benefits

The main benefits include cash back and up to 3.5% variable interest on your balance, budgeting and savings tools, Credit Building and no foreign exchange fees (with the Extra and Everything plans).

How KOHO Credit Building works

KOHO's Credit Building tool is designed to help users build their credit history without a traditional credit card. KOHO advertises Credit Building for $10 a month, with a 30% discount on the Extra plan and a 50% discount on Everything. It reports your activity to Equifax but not TransUnion.

How does Credit Building by KOHO work?

To begin, you'll need a KOHO account on any plan. Then, you can register for Credit Building in the KOHO app.

You might be wondering how KOHO manages to convince credit bureaus you're an established borrower without you taking out any credit. When you sign up, you get a $225 tradeline with no fees or interest, kept separate from your available balance. On each billing date, you set a utilization rate — KOHO suggests 10% or lower — and KOHO takes that portion of the funds and reports the activity to Equifax as a "repayment." Activity from one month is reported the following month. To the credit bureau, it looks like you're paying back a line of credit, and to you, there's no actual difference to your spending money aside from the monthly subscription fee.

How to apply

Let's break down the process of using the Credit Building tool step-by-step to see how it looks from start to finish:

1. 1 Sign up for the Credit Building tool in your account on the app
2. 2 Once you’ve signed up, KOHO will retrieve your current credit score
3. 3 KOHO sets up your $225 tradeline and charges the monthly subscription fee
4. 4 Each billing date, you choose a utilization rate, and KOHO reports the activity to Equifax as a repayment

That's all there is to it! The only thing you really need to do is make sure you have enough money in your account each month to cover the subscription fee, but besides that, everything is done behind-the-scenes. You'll be able to track your credit score changes directly in the KOHO app.

Keep in mind that the subscription renews automatically. If you cancel, KOHO says your credit line will stay open for 12 months.

Is the Credit Builder tool worth it?

In certain scenarios, the Credit Building tool can be worth the relatively small investment. However, it's not right for everyone. Here's why.

If you're doing everything you can to increase your credit score, then Credit Building can be a helpful tool to give you a little extra edge. KOHO says members who started with a credit score of 440 and used its credit tools for 18 months or more with on-time payments saw an average increase of 93 points — though results aren't guaranteed. At full price, the tool costs $120 a year, or $60 a year with the Everything plan's 50% discount. I would recommend this tool if you're responsible with your finances, you're looking for new ways to increase your credit score and you already have other measures in place to maintain or improve your score. It might also be helpful to those who are new to Canada and don't have any credit history yet, but there are also other ways to establish a credit score from scratch.

That being said, KOHO's Credit Building tool isn't a be-all-end-all fix to your credit score woes. If you're reckless with money or simply don't know how to manage your finances, this tool won't fix your credit score the way you want it to. You can still be missing credit card payments or have piles of unpaid loans outside of KOHO, which means you probably won't see your credit score go up after signing up for this tool.

Not only that, but the “set it and forget it” method here is a bit of a double-edged sword. Sure, it’s incredibly convenient just to sign up for this tool and then forget about it for six months as your credit builds the background, but improving your credit score should be a more interactive process. If you’re someone who has bad credit because of poor budgeting and spending habits, then it’s important to be engaged in the process of rebuilding your score so that you can learn how it’s done. I’d like to see this tool expanded into a full suite of credit-building tools, such as articles with advice on how to improve your credit score or a personalized plan of action to help get your finances in order.

Extra benefits of the KOHO Mastercard credit card

KOHO Cover

KOHO bills its Cover product as zero-interest overdraft protection. With Cover, you’ll be given a $50 overdraft limit for $5 per month. You’ll have to pay back any Cover funds you use each month. 

KOHO Cover is a paid bundle that gives eligible members access to a cash advance of up to $500. The bundle is a monthly subscription that starts at $2 a month, and the price rises with the size of your limit — the standard price for the $500 tier is $30 a month for eligible members. KOHO doesn't charge added interest on the advance itself, but the subscription fee is the cost of using it.

Not every member will get $500. KOHO uses an automated system based on your account history to set your limit, the limit isn't guaranteed and KOHO's support team can't grant higher amounts on request. Paying bills through KOHO, paying Cover and other KOHO fees on time and keeping a positive balance may help you qualify for a higher limit over time. The bundle also includes access to a KOHO financial coach.

You can use Cover for everyday purchases and bill payments, but not for e-Transfers or to add money to your savings. If you only need a small amount occasionally, compare the monthly fee to the amount you'd actually borrow before signing up. Eligibility criteria and Terms and Conditions apply.

KOHO referral bonus: How it works

If you're a KOHO member who refers a friend, you can earn up to $100 for each friend who signs up, verifies their account and makes a first purchase of at least $20 within 30 days. You can refer up to 50 friends, and you'll find your referral code in the app. Your friend gets a welcome reward too — currently free months on a paid KOHO plan — though the offer changes from time to time, so check the app for the latest details.

KOHO virtual card vs. actual card

KOHO plans come with a virtual card, which can be added to your phone's wallet, and a physical card as well. Your virtual card is ready as soon as you sign up; you'll have to request a physical card in the KOHO app to be sent one. Eligible everything members can get a metal card, and other plan members can order one for $150. 

How the KOHO Prepaid Mastercard Compares

KOHO Core Mastercard® Prepaid Card Prepaid Mastercard vs. KOHO Extra Mastercard® Prepaid Card Prepaid Mastercard

The KOHO Core and Extra plans are fairly similar, but Extra offers a little more — at a cost. The Core plan has no monthly fee and offers 1% cash back on groceries, transportation and food and drinks, plus 2% variable interest on your balance when you opt in.

The Extra plan costs $12 a month and offers 1.5% cash back on groceries, transportation and food and drinks, 0.25% cash back on all other purchases, 2.5% variable interest when you opt in, 30% off Credit Building and no foreign transaction fees. If you travel or shop in foreign currencies often, the forex savings alone could cover the cost.

KOHO vs. Neo

KOHO and Neo are both popular fintech banking alternatives, aimed at new and younger Canadians. They, more or less, do the same things, but with some differences.

You know all about KOHO at this point, so let’s talk a bit about Neo’s offerings. The Secured Neo Mastercard will run you a $7.99 monthly fee. It comes with account insights to help you better manage your money, and offers 1% cash back on gas and groceries, 1% cash back on everything else, and additional cash back with partners. It also comes with credit monitoring, purchase protection, 24/7 legal assistance, and $2,500 group life insurance. 

Overall, KOHO might offer more features at its higher paid plans but the Neo Premium plan is more cost-effective. 

Disclosures:

• Neo Secured Credit card is issued by Neo Financial™ pursuant to license by Mastercard International Incorporated.

KOHO Prepaid Mastercard vs. Simplii No-Fee Chequing + Cash Back Visa

If you’re on the hunt for a feature-rich chequing account but also want a traditional credit card, you might want to consider the Simplii no-fee chequing account and cash back Visa. They’re separate products that can be used together for everyday banking and credit needs. The Simplii chequing account is a more traditional option than KOHO. It has no monthly fees, unlimited e-transfers and can be used at any CIBC ATM, offering some additional convenience. The Cash Back Visa, meanwhile, also has no fees and allows you to earn 4% at bars and coffee shops, 1.5% on gas, groceries, drugstore purchases and pre-authorized payments and 0.5% on everything else. 

Disclosures:

• †Terms and conditions apply. Click ‘Apply Now’ for complete details. This offer is not available for residents of Quebec

  ‡"Purchase" means any Transaction other than a Cash Advance, Balance Transfer or Convenience Cheque. "Cash" means a Cash Advance, Balance Transfer and Convenience Cheque. Interest rates may change from time to time.

• Simplii Financial™ is a trademark and division of CIBC. Banking services are not available in Quebec.

Is the KOHO Mastercard worth it?

The KOHO prepaid card is an intriguing option for those who want a combination of cash back, up to 3.5% variable interest on their balance and the option to build credit — and with the $0 Core plan, you can try it without paying a monthly fee. You can boost your cash back by shopping with select KOHO merchants, which offer up to 6.5% extra. If you travel often or keep a larger balance, Extra or Everything may pay for itself. Ultimately, if you're looking for a one-stop way to establish a credit profile with responsible card use, KOHO might be just right for your needs.

FAQs

With files from Alicia Schneider