The prime rate in Canada as of September 18, 2025, is currently 4.7%. The prime rate, also called the prime lending rate, is the annual interest rate that Canada's major banks and financial institutions use as a benchmark to set interest rates for variable loans and lines of credit, including variable-rate mortgages. This rate closely follows the Bank of Canada's target for the overnight rate, and changes by the Bank of Canada typically lead lenders to adjust their prime rates accordingly. The prime rate impacts borrowing costs for consumers and businesses, especially for variable-rate products.