Worst rewards card ever?

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Worst rewards card ever?

Postby ilskeptic » Tue Dec 25, 2012 10:22 pm

Commerce Bank now has asked me twice to sign up for my "new Pre-Approved Commerce Bank Rewards Visa credit card." The rewards? One point per dollar in purchases and "3x points for every dollar in interest accrued on your monthly balances."

Wow, talk about perverse incentives.
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Re: Worst rewards card ever?

Postby DEBTINATOR » Tue Dec 25, 2012 11:35 pm

That's pretty ruthless.
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Re: Worst rewards card ever?

Postby Imperabo » Tue Dec 25, 2012 11:56 pm

So . . . it effectively reduces your interest rate from 20% to 19.4%. Something like that?
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Re: Worst rewards card ever?

Postby grabiner » Wed Dec 26, 2012 12:29 am

ilskeptic wrote:Commerce Bank now has asked me twice to sign up for my "new Pre-Approved Commerce Bank Rewards Visa credit card." The rewards? One point per dollar in purchases and "3x points for every dollar in interest accrued on your monthly balances."

Wow, talk about perverse incentives.


I have seen this on other cards as well; around 1998, First USA created a rewards plan which gave points for your purchases but more points if you carried a balance.
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Re: Worst rewards card ever?

Postby travellight » Wed Dec 26, 2012 1:08 am

I laughed out loud; this is almost a joke!
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Re: Worst rewards card ever?

Postby tfb » Wed Dec 26, 2012 3:14 am

Worst? No. Between this card and a run of the mill 1% rewards card, if you don't incur any interest, you are even. Like it or not, some people do incur interest. For them, this card is better, if the interest rate is the same on two cards. Therefore you are at least as well off with this card as a run of the mill 1% rewards card. I'm sure there are cards with lower rewards than 1%. Some cards don't have any rewards at all.
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Re: Worst rewards card ever?

Postby tadamsmar » Wed Dec 26, 2012 9:36 am

At the credit card companies they call people who pay off their balances each month and never pay interest "deadbeats"
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Re: Worst rewards card ever?

Postby sscritic » Wed Dec 26, 2012 10:09 am

tfb wrote:Worst? No. Between this card and a run of the mill 1% rewards card, if you don't incur any interest, you are even.

You read one point as $0.01.
One point per dollar

I read one point as one point. One point might be worth 1/10 of a cent, but only if used to buy subscriptions to magazines you don't want.

I don't have cards that pay points; I only get cards that pay dollars.
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Re: Worst rewards card ever?

Postby Default User BR » Wed Dec 26, 2012 12:47 pm

tadamsmar wrote:At the credit card companies they call people who pay off their balances each month and never pay interest "deadbeats"

This old myth. If they thought that, they'd get rid of people who didn't carry a balance instead of fighting over them.


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Re: Worst rewards card ever?

Postby tadamsmar » Wed Dec 26, 2012 2:00 pm

Default User BR wrote:
tadamsmar wrote:At the credit card companies they call people who pay off their balances each month and never pay interest "deadbeats"

This old myth. If they thought that, they'd get rid of people who didn't carry a balance instead of fighting over them.


Brian


Someone who worked at a credit card company told me that they used that term in the office. I agree that it's more of joke than something the companies would take seriously, I assume they make some money of of the non-interest-payers since they get a merchant fee.
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Re: Worst rewards card ever?

Postby jeffyscott » Wed Dec 26, 2012 10:40 pm

sscritic wrote:I don't have cards that pay points; I only get cards that pay dollars.


I used to do the same, but points/miles from cards we signed up for in the last year, plus an additional $300-400 in fees, have paid for airline tickets for 4 domestic round trips and 2 round trip tickets to Europe. These tickets would have cost us probably close to $4000 and we still have over 100,000 points/miles remaining. Required spending to collect all these points/miles was about $7000.

So far it does not look like I'll be keeping any of the points/miles cards, so I also may soon not have them, but I will be happy to get more of them in future. :)
press on, regardless - John C. Bogle
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Re: Worst rewards card ever?

Postby Bacchus01 » Sat Dec 29, 2012 2:12 am

tadamsmar wrote:
Default User BR wrote:
tadamsmar wrote:At the credit card companies they call people who pay off their balances each month and never pay interest "deadbeats"

This old myth. If they thought that, they'd get rid of people who didn't carry a balance instead of fighting over them.


Brian


Someone who worked at a credit card company told me that they used that term in the office. I agree that it's more of joke than something the companies would take seriously, I assume they make some money of of the non-interest-payers since they get a merchant fee.



The merchant fees they collect with almost no risk far outweigh the risky interest from the balance-carriers.
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