bank rates

New Capital One Card Pays 1.5% Back

Capital One makes it easy to earn rewards with this no-annual-fee credit card.It wasn’t too long ago that if you had excellent credit you could find rewards credit cards that offer more than 1% cash back on all purchases.

Today, it’s nearly impossible.

Capital One recognizes that consumers hate to weed through complicated details, so last week it launched a new and unique credit card titled the Capital One Cash Card.

While some cards provide 5% cash back on rotating categories or 2% cash back on select purchases, there’s often a limit to how much can be saved, rules on how it can be spent or annual fees that cut your rewards.

With the Cash Card, you’ll receive 1% cash back on every purchase (www.capitalone.com/cash). Then on every anniversary you own the card, you’ll earn a 50% bonus on the reward you’ve earned the previous year.

For example, if I earn $300 in cash rewards during a year (spending $30,000), I would be given an additional $150.

The bonus effectively makes this card a 1.5% cashback card, and that’s about as good as you’ll find anywhere. (See our review of the new Bank of America Accelerated Rewards American Express Card, which pays 1.25% cash back.)

New card holders also will receive a $100 bonus after they spend $500 during the first three months of ownership.

There are also a few additional perks and rewards to note for Cap One users:

  • There are no foreign transaction fees on this or any Capital One credit card.
  • There is no annual fee.
  • You’ll pay a 0% intro APR on both purchases and balance transfers until August 2012. Once the intro rate expires, the purchase APR becomes 11.9% to 21.9% variable (that’s the prime rate of 3.25% plus 8.65% to 18.65%), depending on credit history.

In order to be approved for the Capital One Cash Card, you must have excellent credit.

If you apply with anything less, you may be approved for a secondary Capital One card, which does not carry the same benefits you see above.

Compare this deal with other credit card offers in our extensive database.

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Comments (1)
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  1. njambi said:
    on August 31st at 02:19 pm

    this is very interesting. the cashback may cover the service fees charged for holding an account.