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The short answer
Newcomer cards start with low limits because the issuer has no Canadian repayment record to judge you by, so it lends a small amount and watches how you use it. The FCAC says issuers set your limit when you first get the card and must get your permission, in writing or verbally, before increasing it. Limits grow when you pay on time, keep your balance well under the limit (the FCAC suggests using less than 30% of total credit), and then ask for an increase.
Why the limit is small
In Nigeria you may have had a long banking relationship, a salary account and perhaps a loan history. None of that sits on your Canadian credit file. Canada's two main credit bureaus, Equifax and TransUnion, hold records of Canadian accounts, and the FCAC notes only that "some lenders may look at your credit history from another country". To an issuer, a newcomer with no file is an unknown, and the safest way to lend to an unknown is a small limit.
The FCAC's How credit cards work page (modified 15 October 2025) puts it simply: "Credit card issuers set your limit when you first get your credit card." The factors each issuer uses are its own, but income, existing debts and your history with that bank are the usual starting points.
Why a low limit can hurt your score
Utilisation is the share of your limit you are using. The FCAC's Improving your credit score page (modified 1 July 2026) advises using less than 30% of your total credit limit, and says to keep monthly utilisation low even if you pay the balance in full. On a small limit that is easy to break by accident.
| Limit (example) | 30% of limit | Spend that crosses it |
|---|---|---|
| $500 | $150 | One weekly grocery shop and a phone bill |
| $1,000 | $300 | A month of groceries |
| $3,000 | $900 | A new laptop |
Example only. If you put $400 of groceries on a $500 card each month, your utilisation reads as 80% even if you pay in full, because issuers typically report the statement balance, not what you pay afterwards. Two ways round it: pay part of the balance before the statement date, or use the card only for one or two fixed bills.
How limits grow
- Pay on time, every time. The FCAC calls payment history the most important part of your score.
- Keep utilisation low as above.
- Avoid many applications at once. The FCAC lists how often you apply for new credit as a factor.
- Ask. After several months of clean use, ask the issuer for an increase. Issuers set their own timing; some review accounts on their own.
- Keep the first card open. The FCAC suggests keeping older accounts open if they have no annual fee, and notes that keeping one account open with a low limit may help your score.
The consent rule
The FCAC says your issuer "must get your permission in writing or verbally before increasing your credit limit", and once you consent it must confirm the change in writing, no later than your next statement. An increase cannot simply appear. If a higher limit would tempt you to overspend, you can decline it.
A first-year plan
Example only, for a newcomer with a $500 limit:
| Months | What to do | Why |
|---|---|---|
| 1 to 3 | Put one fixed bill, such as a $60 phone plan, on the card and pay in full by autopay | Builds on-time history at 12% utilisation |
| 4 to 6 | Add small, planned purchases; keep the statement balance under $150 | Stays under the FCAC's 30% guide |
| 7 to 9 | Check your credit report from Equifax and TransUnion for errors | Your file should now show the account |
| 10 to 12 | Ask the issuer for a higher limit, and say no to any you do not need | A higher limit with the same spending lowers utilisation |
Each issuer has its own timing and may decline a request, so treat the months as a guide, not a promise. The habit that matters is paying the full statement balance on time.
Secured cards and newcomer programmes
Some newcomers start with a secured card, where a deposit backs the limit, or with a bank's newcomer package, which may offer an unsecured card without Canadian history. The terms differ by bank; our guide to how secured cards work explains the deposit and how to move to an unsecured card, and building a score from zero covers the wider plan.
Two things the grace period does not cover
The FCAC says federally regulated issuers must give at least 21 days interest-free on the previous month's purchases, but the grace period does not apply to cash advances, cash-like transactions or balance transfers. Using your new card to fund a transfer to Nigeria may be treated as a cash-like transaction, with interest from day one; see our guide to card-funded transfers.
Where Pryme fits
Pryme does not issue Canadian credit cards. For sending money home without borrowing, a Pryme account holds NGN, USD, GBP and EUR; the app shows the rate and the fee before you approve.
Questions people ask
Why is my credit limit so low in Canada?
Because the issuer has no Canadian record of how you repay. The FCAC says issuers set your limit when you first get the card; it usually rises after a period of on-time use.
How do I increase my credit card limit as a newcomer?
Pay on time, keep balances under 30% of the limit, avoid many applications, and ask the issuer after several months. It must get your consent before any increase.
Can a bank raise my limit without asking?
No. The FCAC says the issuer must get your permission in writing or verbally, and confirm the change in writing.
Does using my whole limit and paying it off hurt my score?
It can. The FCAC advises keeping monthly utilisation low even if you pay in full.
Sources
- FCAC: How credit cards work (modified 15 Oct 2025) · accessed Oct 2026
- FCAC: Improving your credit score (modified 1 Jul 2026) · accessed Oct 2026
- FCAC: Credit report and score basics (modified 1 Jul 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.