Koho Review: Prepaid Visa That Helps Build Credit in Canada

Banking & Financial Products

Koho Review: Prepaid Visa That Helps Build Credit in Canada

Mar 20, 202619 min read

Introduction: Can a Prepaid Card Really Build Your Credit?

For millions of Canadians dealing with bad credit, the idea of building a credit score without a traditional credit card sounds almost too good to be true. Enter Koho, a Canadian fintech company that has quietly become one of the most popular alternative banking solutions in the country. With over 1.5 million users as of 2026, Koho offers a prepaid reloadable Visa card paired with a spending account — and, crucially, an optional Credit Building add-on that reports your activity directly to Equifax Canada.

In this comprehensive Koho review, we will break down every feature of the Koho prepaid Visa, examine how the credit-building program actually works, compare it to traditional secured and unsecured credit cards, and help you decide whether Koho is the right tool for your credit-repair journey. Whether you have a credit score of 450 or you are simply looking for a no-fee banking alternative, this guide covers everything you need to know.

What Exactly Is Koho?

Koho is a Canadian financial technology (fintech) company founded in 2014 by Daniel Eberhard in Vancouver, British Columbia. It is not a bank in the traditional sense. Instead, Koho partners with Peoples Trust Company, a Schedule I trust company regulated by the Office of the Superintendent of Financial Institutions (OSFI), to hold customer deposits. Your money is protected under the Canada Deposit Insurance Corporation (CDIC) up to $100,000.

At its core, Koho provides a prepaid reloadable Visa card linked to a digital spending account. You load money onto your Koho account via direct deposit, e-Transfer, or bill payment, and you spend using the Visa card anywhere Visa is accepted — in-store, online, and internationally. Because it is a prepaid card, you can only spend money you have already loaded, which eliminates the risk of going into debt.

Koho Is Not a Credit Card

This is the most important distinction to understand. A credit card extends you a line of credit — you borrow money from the issuer and pay it back later. A prepaid card uses your own money. Because Koho is prepaid, there is no credit check to open an account. Anyone 18 or older with a valid Canadian address can sign up, regardless of credit score.

However, Koho has added a credit-building feature that bridges the gap between prepaid and credit products. This is what makes Koho unique in the Canadian market and why it has attracted so much attention from consumers with bad credit.

Koho Plans and Pricing: A Complete Breakdown

Koho offers four main plan tiers, each with different features and pricing. Choosing the right plan depends on your spending habits and whether you want the credit-building feature included or as a paid add-on.

If your primary goal is to build credit, the Extra plan at $9/month offers the best value because it includes the Credit Building feature at no additional cost. On the Easy plan, you would pay $10/month for Credit Building alone, making your total $10/month — more expensive than Extra, which also gives you higher cashback and 3% interest on your balance.

How Koho Credit Building Works: The Detailed Breakdown

The Koho Credit Building feature is the primary reason many Canadians with bad credit turn to this platform. Understanding exactly how it works will help you set realistic expectations about its impact on your credit score.

1. Sign Up and Activate Credit Building

   When you enable the Credit Building feature (either through a paid plan that includes it or as a $10/month add-on), Koho sets up a small installment loan on your behalf. This is not money you borrow in the traditional sense — Koho fronts a small amount (typically $7) and holds it in reserve. You do not receive these funds or need to repay them manually.

2. Koho Reports Monthly to Equifax Canada

   Each month, Koho reports your installment loan payment to Equifax Canada. The payment is automatically marked as “on time” and “paid as agreed.” This builds a positive payment history on your Equifax credit report, which is the single most important factor in your credit score (accounting for approximately 35% of your score calculation).

3. Your Credit Score Gradually Improves

   Over time — typically within 3 to 6 months — you should begin to see improvements in your Equifax credit score. Koho reports indicate that the average user sees a credit score increase of approximately 22 points within the first few months of using the Credit Building feature. Results vary based on your overall credit profile.

4. Monitor Your Progress in the App

   Koho provides free credit score monitoring within the app, allowing you to track your Equifax score over time. You can see your score update approximately once a month and watch the impact of the Credit Building feature in real time.

5. Graduate to Traditional Credit Products

   Once your score has improved sufficiently (ideally above 650), you can begin applying for traditional credit products like secured credit cards, unsecured credit cards, or even loans and mortgages. The positive payment history from Koho remains on your credit report, continuing to benefit your score.

Important Limitations of Koho Credit Building

While the Credit Building feature is genuinely useful, there are some important limitations you should understand before signing up:

• Equifax only: Koho reports exclusively to Equifax Canada. It does not report to TransUnion. Since some lenders check only TransUnion, the credit-building benefit may not be reflected across all credit applications.
• Single trade line: Koho adds only one trade line to your credit report (an installment loan). A healthy credit profile typically includes multiple trade lines of different types.
• No credit utilization benefit: Because Koho is a prepaid card, your spending does not contribute to credit utilization ratios. Traditional credit cards, when used responsibly (keeping utilization below 30%), help build credit through utilization as well as payment history.
• Monthly cost: At $10/month on the Easy plan, you are paying $120/year for credit building. A secured credit card from a major bank (like the Home Trust Secured Visa) may offer more credit-building value at a lower annual cost.

If you are applying for credit with a lender that checks TransUnion exclusively (which some Canadian lenders do), your Koho payment history will not be visible to them. For maximum credit-building impact, consider pairing Koho with a secured credit card that reports to both bureaus. Most major bank secured cards, including those from Capital One, Home Trust, and Refresh Financial, report to both Equifax and TransUnion.

Koho Cashback and Rewards: What You Actually Earn

Beyond credit building, Koho offers a cashback rewards program that competes favourably with many traditional bank accounts and even some credit cards. The cashback you earn depends on your plan tier and where you shop.

Category Cashback

On the Easy (free) plan, you earn 1% cashback on groceries, food and drink, and transportation purchases. This is automatic and requires no activation. On the Extra ($9/month) and Everything ($19/month) plans, this increases to 2% cashback in these same categories.

To put this in perspective, if you spend $800/month on groceries and food (roughly average for a Canadian household), you would earn:

• Easy plan: $800 × 1% = $8/month = $96/year in cashback
• Extra plan: $800 × 2% = $16/month = $192/year in cashback (minus the $108 annual plan cost = $84 net benefit)
• Everything plan: $800 × 2% = $16/month = $192/year in cashback (minus the $228 annual plan cost = -$36 net loss)

Partner Cashback Offers

Koho also features rotating partner cashback offers of up to 5% at select retailers. These have included brands like DoorDash, Skip The Dishes, Hudson’s Bay, and various restaurants. These offers change regularly and are available across all plan tiers.

Interest on Your Balance

One of Koho’s more unique features is that it pays interest on the money sitting in your account. This is unusual for a prepaid card product. The interest rates vary by plan:

• Easy: 0.5% on your total balance
• Essential: 1.5%
• Extra: 3.0%
• Everything: 4.5%

While these rates are calculated differently than a traditional savings account (Koho pays interest as cashback rather than compound interest), the Extra and Everything plans offer rates competitive with or exceeding many high-interest savings accounts from traditional banks. As of early 2026, EQ Bank’s Savings Plus Account offers around 2.5%, making Koho’s 3.0% to 4.5% notably attractive.

Koho vs. Secured Credit Cards: Which Is Better for Bad Credit?

This is the question many Canadians with bad credit ask, and the answer depends on your specific situation. Let us compare Koho to the most common secured credit card options available in Canada.

Koho is the better option if: you cannot qualify for a secured credit card (perhaps due to an undischarged bankruptcy or consumer proposal), you do not have $300 to $500 for a security deposit, you are worried about the temptation of a credit line, or you want a combined banking-and-credit-building solution. Koho is also ideal for newcomers to Canada who have no credit history and no Canadian banking relationship.

When a Secured Card Is Better

A secured credit card is the stronger credit-building tool if you can qualify. It reports to both bureaus, builds credit utilization history, and generally has a greater impact on your credit score over the same time period. If you can afford the security deposit and trust yourself to use the card responsibly (paying the full balance each month), a secured card will likely build your credit faster.

The Best Strategy: Use Both

The most effective approach is to use Koho as your everyday banking solution while simultaneously holding a secured credit card that you use for a small recurring purchase each month. This gives you:

• Two trade lines instead of one
• Reporting to both Equifax (via Koho) and both bureaus (via the secured card)
• Credit utilization history (from the secured card)
• Installment loan history (from Koho’s credit-building feature)
• Cashback and interest earnings (from Koho)

Day-to-Day Banking With Koho: Features and Experience

Even without the credit-building angle, Koho functions as a surprisingly capable everyday banking alternative. Here is what you get:

Loading Money

You can fund your Koho account through several methods:

• Direct deposit: Set up your employer’s payroll to deposit directly into your Koho account. Koho provides the necessary institution and transit numbers.
• Interac e-Transfer: Send an e-Transfer to your Koho account email. Funds typically arrive within 30 minutes.
• Bill payment: Add Koho as a payee through your existing bank account and send funds via bill payment. This can take 1–3 business days.

Spending

The Koho Visa card is accepted everywhere Visa is accepted — both in-store and online. It works with Apple Pay, Google Pay, and Samsung Pay, so you can make contactless payments with your phone. Koho also provides a virtual card number instantly upon signup, so you can start making online purchases before your physical card arrives.

Savings Features

Koho includes several built-in savings tools:

• Roundups: Automatically round up every purchase to the nearest dollar and set aside the difference in a savings goal.
• Savings goals: Create multiple savings goals and allocate funds toward specific targets (emergency fund, vacation, etc.).
• Automatic savings: Set a percentage of each direct deposit to be automatically moved to savings.

Budgeting and Spending Insights

The Koho app categorizes your spending automatically, showing you where your money goes each month. You can set spending limits for specific categories and receive notifications when you are approaching them. This is particularly useful for Canadians who are working on rebuilding their finances alongside their credit.

Koho Fees: The Complete Picture

One of Koho’s biggest selling points is its fee structure — or rather, the lack of one. Here is every fee associated with Koho:

Compared to traditional banks, Koho’s fee structure is remarkably transparent. The Big Five banks in Canada typically charge $4 to $30/month for chequing accounts, $1.50 to $3.00 per e-Transfer, and $5 for each transaction beyond a monthly limit. Koho charges none of these fees.

The only notable fee is the 1.5% foreign transaction fee, which is actually lower than the 2.5% charged by most major Canadian banks and credit cards. If you travel or shop internationally, Koho is a cost-effective option.

Koho for Newcomers to Canada

Koho has become an increasingly popular choice for newcomers and immigrants to Canada. Here is why:

• No credit check: New immigrants have no Canadian credit history, making it difficult to open traditional bank accounts with premium features or obtain credit cards. Koho requires no credit check.
• Instant virtual card: You get a virtual Visa card number immediately upon signup, allowing you to make purchases before your physical card arrives in the mail.
• Credit building: New Canadians can begin building their credit history from day one with the Credit Building feature.
• No minimum balance: Many newcomers arrive with limited savings. Koho has no minimum balance requirement.
• Competitive FX rates: The 1.5% foreign transaction fee is lower than most banks, useful for newcomers who may need to make purchases from their home country.

Security and Safety: Is Koho Trustworthy?

Given that Koho is a fintech company rather than a traditional bank, many Canadians understandably have questions about security. Here are the key facts:

• CDIC protection: Funds held through Koho are held in trust by Peoples Trust Company, which is a CDIC member institution. Your eligible deposits are insured up to $100,000.
• FINTRAC registered: Koho is registered with the Financial Transactions and Reports Analysis Centre of Canada as a money services business.
• Encryption: Koho uses 256-bit AES encryption for data at rest and TLS 1.2+ for data in transit.
• Card controls: You can instantly lock and unlock your card from the app, and you can disable specific transaction types (online purchases, ATM withdrawals, etc.).
• Zero liability: As a Visa card, Koho provides Visa’s zero-liability protection for unauthorized transactions.

Your Koho funds are held in trust by Peoples Trust Company and are eligible for CDIC insurance up to $100,000. This is the same protection you get with deposits at major banks like TD, RBC, or BMO. Koho is not itself a bank, but your money is held by one.

Common Complaints and Drawbacks

No financial product is perfect, and Koho has its share of complaints. Here are the most common issues reported by users:

Holds on Pre-authorized Transactions

Gas stations, hotels, and car rental companies often place pre-authorization holds on cards. With a credit card, this hold is against your credit limit. With Koho (a prepaid card), the hold is against your actual balance, meaning those funds are temporarily unavailable. This can be frustrating if you have a limited balance.

No Cheque Deposits

Koho does not support cheque deposits. If you receive payments by cheque, you will need to maintain a traditional bank account to deposit them.

Limited Customer Support Hours

While Koho offers in-app chat support and email support, it does not have phone support. Some users have reported slow response times during peak periods.

e-Transfer Delays

While e-Transfers are typically fast, some users report delays of several hours during evenings and weekends, which can be inconvenient if you need funds immediately.

Koho vs. Other Fintech Alternatives

Koho is not the only fintech player in the Canadian market. Here is how it compares to its closest competitors:

How to Sign Up for Koho: Step-by-Step

Signing up for Koho is straightforward and can be completed in under 10 minutes:

1. Download the Koho app from the Apple App Store or Google Play Store.
2. Enter your basic information: name, email, phone number, date of birth, and Canadian address.
3. Verify your identity: Koho will ask you to take a photo of your government-issued ID (driver’s licence, passport, or provincial photo ID) and a selfie for identity verification.
4. Choose your plan: Select Easy (free), Essential, Extra, or Everything. You can always upgrade later.
5. Receive your virtual card: You will get a virtual Visa card number immediately, allowing you to make online purchases right away.
6. Wait for your physical card: Your physical Koho Visa card will arrive in the mail within 5–10 business days.
7. Fund your account: Load money via direct deposit, e-Transfer, or bill payment.
8. Enable Credit Building (optional): If you want the credit-building feature, activate it from the app.

Real User Results: What to Expect

Based on publicly available user reviews and Koho’s own reported data, here is what typical users experience:

• Credit score increase: Most users report seeing a score increase of 10 to 40 points within the first 6 months of using Credit Building. Koho’s own data suggests an average increase of approximately 22 points.
• Timeline: The first credit report update typically appears 4 to 8 weeks after activating Credit Building. Meaningful score changes usually take 3 to 6 months.
• Best results: Users who combine Koho with other credit-building strategies (secured credit cards, becoming an authorized user, etc.) tend to see the best results.

Pros and Cons Summary

Pros

• No credit check to sign up — anyone can get a Koho card
• Credit Building feature reports to Equifax Canada
• Competitive cashback (up to 5% with partners)
• Interest paid on your balance (up to 4.5% on the Everything plan)
• No overdraft fees, no NSF fees, no interest charges
• Free Interac e-Transfers
• Low foreign transaction fee (1.5% vs. industry standard 2.5%)
• Works with Apple Pay, Google Pay, and Samsung Pay
• CDIC-insured deposits through Peoples Trust
• Built-in budgeting and savings tools

Cons

• Reports to Equifax only — not TransUnion
• Credit Building costs $10/month on the free plan
• Not a full bank replacement (no cheque deposits, no joint accounts)
• Pre-authorized holds can tie up your balance
• No phone customer support
• Physical card takes 5–10 business days to arrive
• Cannot be used where Visa is not accepted

Frequently Asked Questions About Koho

Final Verdict: Is Koho Worth It?

Koho has carved out a unique and valuable niche in the Canadian financial landscape. It is not perfect — no single financial product is — but for Canadians with bad credit or no credit history, it offers a genuinely useful combination of features that is difficult to find elsewhere.

The Credit Building feature is the star of the show. While it has limitations (Equifax only, single trade line, monthly cost), it provides a legitimate, low-risk path to establishing positive credit history for people who may have no other options. When combined with its competitive cashback, interest on balances, and fee-free banking features, Koho presents a compelling package.

Our recommendation: if you are currently rebuilding your credit, start with Koho’s Extra plan for the best balance of credit building, cashback, and features. Use it as your everyday spending card while simultaneously applying for a secured credit card to maximize your credit-building efforts. Within 6 to 12 months, you should see meaningful improvement in your credit score, opening the door to better financial products in the future.

Disclaimer: This review is for informational purposes only and does not constitute financial advice. Credit-building results vary based on individual circumstances. Always consult with a licensed financial professional before making significant financial decisions.