Many credit card issuers kicked off 2017 by launching attractive bread-and-butter rewards programs, which some experts say is part of an effort to steal market share and attract more middle-class cardholders.
Among the offers being rolled out or already available are 10% cash back on restaurant purchases and an offer of limitless cash rewards as part of a pilot credit card being tested by USAA.
“There’s a battle for dominance,” said David Robertson, publisher of the Nilson Report, which predicted this trend. “Credit card issuers are trying to create maximum loyalty.”
According to Robertson, the credit card market recently emerged from a period of escalating offers among premium cards. The focus has now trickled down.
Beverly Harzog, credit card expert and author of “The Debt Escape Plan,” said another driver of the current trend is credit card issuers trying to make rewards programs more straightforward for middle-class users who don’t necessarily have time to sign up for and pursue a variety of rewards deals.
“Cash back cards are getting simpler and are breaking into categories that work for specific customers,” Harzog said.
This creates an intriguing landscape of credit card offers. Here are some of the best new middle-class offers identified by experts. And remember: It’s a good idea to know your credit score to have any idea of whether you’ll qualify before applying for a card. You can check two of your scores free, updated every 14 days, on Credit.com.
New Offers From American Express
Both cards now reward new members with 10% cash back on U.S. restaurant purchases made within the first six months of sign-up, up to $200. In addition, new card members receive a welcome bonus after spending $1,000 within their first three months. For the Blue Cash Preferred card, the bonus is $150 and for the Blue Cash Everyday card, it is $100.
USAA’s Limitless Cash Back Rewards Visa Signature
The USAA Limitless Cash Back Rewards Visa Signature earns 2.5% on all purchases. What’s more, there’s no cap on the cash back rewards.
As long as cardholders maintain a $1,000 monthly direct deposit in a USAA checking account, they continue to earn 2.5% cash back. If that deposit minimum is not met, the cash back reward drops to 1.5% on purchases.
The downside of this card is that it has not been officially launched yet. It’s being pilot-tested, USAA spokeswoman Gloria Manzano said.
“If we determine this potential new product can help us serve our members better, we’ll make (it) available to all of our members as soon as possible,” Manzano said.
The card is available to those living in more than two dozen states where it’s being tested.
Premier Dining Rewards From Capital One
Capital One introduced its Premier Dining Rewards card last week.
The card offers an enhanced cash back earn rate in categories the company says consumers are spending more on.
Perhaps putting it in competition with USAA, the card’s rewards include unlimited 3% cash back on restaurant purchases, 2% cash back on grocery store spending and 1% on all other purchases.
Chase Freedom Unlimited
The Chase Freedom Unlimited (read our review here) is promoting a reward for those who spend $500 in the first three months after sign-up.
For those who meet the spending threshold, the card gives $150 cash back. While the offer has been around since 2016, Kerri Moriarty, of Boston-based Cinch Financial, said it’s still worth noting.
“The fact that you can get $150 cash back within the first 90 days for spending just $500 is an aggressive offer,” said Moriarty. “Other cards typically require $1,000 or more of spending before getting that cash back. It shows that they’re really trying to attract customers and steal them away from other cards.”
At publishing time, the Blue Cash Everyday From American Express, Blue Cash Preferred From American Express and Chase Freedom Unlimted cards are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for this card. However, this relationship does not result in any preferential editorial treatment. This content is not provided by the card issuer(s). Any opinions expressed are those of Credit.com alone, and have not been reviewed, approved or otherwise endorsed by the issuer(s).
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