How to Build Your Credit From Scratch as a Canadian Immigrant

By Julien Brault, founder of MooseMoney.

When you arrive in Canada, your credit history does not come with you. Regardless of how responsibly you managed debt in your home country, Canadian lenders, landlords, and even some employers will see a blank file. The fastest way to start building credit from scratch is to get a secured credit card, use it for small recurring purchases, and pay the balance in full every month. Within six to twelve months of consistent on-time payments, you will have a usable credit score.

Richard Godyer, Chief Credit Risk Officer at Neo Financial, has experienced this firsthand. "I had a perfectly good credit rating back home in the UK and when I moved to Canada, I had no credit rating at all. I was married to a Canadian, so I could rely on my wife's credit rating, but I had none of my own," explained Godyer.

Going From No Score To Good Score

Canada's two national credit bureaus, Equifax and TransUnion, each maintain a file on you once a lender first requests your report. "Once the first attempt to pull a credit file that doesn't exist occurs, that credit file gets created. Now, the person does have a credit report, but not a credit score," stated Julie Kuzmic of Equifax Canada.

Canadian credit scores range from 300 to 900. A score of 300 is not your starting point as a newcomer because that number is reserved for people with a documented history of missed payments and defaults. If you use credit responsibly from day one, your first calculated score should land well above the floor. "If the person has been paying on time each month, then I believe that it would typically start quite a bit higher than 300, which is the lowest possible score that can be calculated," explained Julie Kuzmic, Head of Consumer Advocacy and Compliance at Equifax Canada.

Your score is shaped by five main factors: payment history (the most heavily weighted), credit utilization ratio, length of credit history, types of credit, and recent credit inquiries. Because the length of your history matters, building credit is not instant. "If you open up a secured card with Neo and use it sensibly, you will improve your credit score. But because a large part of what goes into your credit score is the history, it takes some time," stated Godyer.

Why Your Foreign Credit History Usually Does Not Transfer

Canadian credit bureaus do not pull data from bureaus in other countries. A company called Nova Credit offers a product called Credit Passport that translates international credit files for participating lenders. In August 2025, Scotiabank became the first Canadian bank to embed Nova Credit directly into its digital credit card application process, allowing permanent residents and foreign workers who have been in Canada fewer than five years to leverage their international credit history from select countries for potentially higher credit limits on Scotiabank credit cards.

However, adoption across the industry remains limited. "What Nova Credit does is it gives banks and issuers access to people's foreign credit bureau. Neo does not use it and I don't think many Canadian lenders use it," said Godyer. For most newcomers, the practical reality is that you will need to build a Canadian credit file from zero.

Step-by-Step Plan to Build Credit From Scratch

1. Get a Social Insurance Number first

You need a SIN to open credit accounts in Canada. You can apply online or in person at a Service Canada Centre.

2. Open a chequing account

A basic bank account like the Neo Everyday Account does not generate a credit score on its own, but it establishes a relationship with a financial institution and gives you a place to manage bill payments.

3. Apply for a secured credit card

A secured card requires a refundable security deposit, and your credit limit typically equals that deposit. The Secured Neo Mastercard, for example, reports your payment activity to the credit bureaus, which is exactly what builds your file. Other banks and credit unions also offer secured cards, so compare annual fees and whether the issuer reports to both Equifax and TransUnion.

4. Use the card for small, recurring expenses

Put groceries or a streaming subscription on the card and pay the full statement balance before the due date every month. Keep your utilization below 30 percent of your credit limit.

5. Avoid the interest trap

Richard Godyer, Chief Credit Risk Officer at Neo Financial, warns newcomers against a common pitfall like getting a high interest car loan just to build their credit. "The biggest mistake new immigrants can make when trying to build their credit history is accepting a very high interest rate loan. They're much better off getting a secured card, using it and making regular payments. It will be far more effective than having a single loan that could end up costing you thousands in interest," said Godyer.

6. Get a cell phone plan on a postpaid contract

Most major Canadian telecoms report payment activity to the credit bureaus. A plan under $60 per month keeps costs low while adding another tradeline to your file.

7. Consider rent reporting

Services like Borrowell's Rent Advantage can report your monthly rent payments to the credit bureaus, adding another positive data point to your history.

How to Verify Your Progress

Not every payment you make gets reported to the bureaus, so checking your file is essential. Julie Kuzmic from Equifax Canada put it plainly: "The most important part of building credit is making sure that your positive payment history is being reported to the credit bureaus and the reality is that not all credit or bill payments are reported to credit bureaus. One way to make sure you are making progress is to take a look at your credit reports at both Equifax and TransUnion, which you can do for free."

You can request your free credit report by mail from both Equifax Canada and TransUnion Canada. Equifax also offers free online access through its consumer portal, and several fintech apps provide free score monitoring.