by Justin McHenry

Best Buy has launched an improved rewards program with the introduction of the Best Buy Reward Zone MasterCard and the announcement that Reward Zone program members will no longer pay an annual fee.  Members previously paid $9.99 per year for the program, which allowed them to earn points on Best Buy purchases only.  With the introduction of the Reward Zone MasterCard, Best Buy customers have the opportunity to earn points toward Best Buy gift certificates anywhere they make a purchase with the card.

The Best Buy Reward Zone MasterCard offers cardholders a 4% rebate on Best Buy purchases and a 1% rebate when used elsewhere.  In addition, the card will offer 2% rebates in select categories, which will change throughout the year.  For the remainder of 2006, the 2% rebate will apply to travel and dining purchases.

The Reward Zone card that is accepted at Best Buy only offers points equivalent to a 2% rebate on Best Buy purchases. As mentioned, cardholders will no longer pay an annual fee.

The Best Buy Reward Zone MasterCard is issued by HSBC.

by Liz Morris

American Express and JetBlue Airways have announced the launch of the JetBlue Business Card, which offers small business owners 5% discounts on JetBlue flights, plus a traditional frequent flyer program. This is not the first partnership between JetBlue and American Express, as they’re already teamed up on The JetBlue Card for consumers.

The JetBlue Business Card offers similar features to those of the consumer card, but does tailor them somewhat for likely business purchases. The JetBlue Business Card offers one Award Dollar per dollar charged, and double Awards Dollars on certain small business purchases, including JetBlue travel, gas, office supplies, wireless phone charges, and car rentals. The card is also offering 5,000 Award Dollars when new cardholders use the card for the first time. Free flights on JetBlue start at 20,000 Award Dollars, which are equal to 100 points in JetBlue’s TrueBlue frequent flyer program.

The JetBlue Business Card carries a $40 annual fee.

by Justin McHenry

The technology to allow cell phones to store and transmit credit card information has been available for well over a year, but questions about security, a lack of manufacturers interested in adding the technology, and a lack of merchants with compatible credit card readers, have combined to make the actual use of such payments rare.  Today’s article in The Washington Post, however, demonstrates that the technology is making inroads, even among some mom-and-pop retailers.

The article centers on the D.C.-area Chevy Chase Supermarket, which is experimenting with cell phone credit card payments, but is still a year away from rolling it out to al of its customers. Even when the supermarket does, it’s questionable whether customers will use their cell phones for such payments, or whether many cell manufacturers will have even incorporated the technology into their phones.

The article quotes ABI Research as saying that less than five percent of the world’s cellphones will have the necessary technology by next year, and that the number will be 30 percent by 2011. Currently, only about 50,000 merchants can accept credit card payments via mobile phones.

by Tim Castleman

American Express launched the Bonus Points Mall yesterday, allowing Membership Rewards members the opportunity to earn double points when they use their American Express cards to shop at specific merchants via the mall. Merchants included at the mall’s launch include Saks Fifth Avenue, Neiman Marcus, Target, iTunes, Barnes & Noble, The Home Depot, Staples, Gap, Brooks Brothers, Eddie Bauer, Lands’ End, Gateway, Best Buy, Ann Taylor, JCPenney, Bloomingdale’s, Old Navy, Dell, Petco and about 60 others.

To receive double Membership Rewards points, American Express cardholders must sign in, then find the retailers they wish to shop at within the Bonus Points Mall. Once the retailer’s name is clicked, the cardholder is redirected to the merchant’s regular Web site, and that specific shopping session is tracked, allowing American Express to credit double points on any purchases made.

Average credit card rates continue to hold fairly steady, as the Federal Reserve Board voted again yesterday to hold the line on further rate increases. It was the second straight meeting without a hike after more than a year of steady bumps by the Fed.

The average credit card rate for non-reward consumer credit cards remains at 14.14%. For those with excellent credit, the average rate stands at 11.23%.

Consumer reward card rates held steady as well, at 15.62%. For folks with excellent credit, this rate stands at 13.19%.

Student credit card rates did take a small hit, increasing to 16.54% in our survey, up from 16.52%.

Business credit card rates also increased slightly. Non-reward business credit cards now have an average interest rate of 12.18%, up from 12.15%. Business reward cards moved up even more, to 14.16% from 14.11%.

Financial institutions represented in the survey include Advanta, American Express, Bank of America/MBNA, Capital One, Chase, Citi, Discover, National City, Providian, Pulaski Bank, U.S. Bank, Wells Fargo and more.

by Justin McHenry

Discount store chain Dollar General announced today that customers will be able to use Visa credit cards and check cards at Dollar General’s 8,000+ stores beginning tomorrow. The move ends Dollar General’s exclusive agreement with Discover Card, which had been the only credit card accepted at the stores since the middle of 2004.

“The dollar store retail segment has been one of the last untapped markets for payment card acceptance,” said Bill Dobbins, vice president, merchant relations at Visa USA.

Dollar General operates 8,190 stores in 34 states. Despite its name and beginnings as a dollar store, Dollar General’s Web site says that only 30 percent of its products still sell for one dollar or less.

by Justin McHenry

American Express announced a deal with Guaranty Bank last week that will result in Guaranty offering its customers a co-branded American Express Preferred Rewards Gold Card at its 150+ branches in Texas and California.

The deal is an extension of an existing partnership between the institutions. Last October Guaranty introduced “My Checking” accounts offering American Express Membership Rewards points, and Guaranty also has been offering a co-branded American Express Small Business Gold Card and a Platinum Business Cash Rebate Card to the bank’s small-business customers.

Deals of this type are generally a win-win–American Express widens its distribution and gains new customers, while the partner bank painlessly adds credit cards to its offerings. In most such partnerships, the co-branding bank also receives a bounty for each new cardholder it signs up as well as a percentage of purchases made with the cards. (American Express and Guaranty Bank offered no informations on the specifics of this particular deal.)

by Justin McHenry

Chase launched its new Freedom Visa today with the promise of greater flexibility in switching between its cash back and reward programs, but the generosity of its gas purchase reward may be the bigger draw for consumers who’ve seen these rewards cut back in recent months. In addition, the ability to get an extra $50 tacked on to redemptions of $200 should bring in heavy card users.

The Chase Freedom Card is offering 3 points (or 3% with the cash back option) for purchases at grocery stores, gas stations and quick service restaurants on the first $600 of these purchases per month. All other purchases earn one percent back (or one point per dollar). Customers who choose to earn cash back get a $50 bonus if they can hold out until reaching the $200 threshold.

While the Chase Freedom Card’s highlighted feature is the ability for cardholders to switch between a points program and cash back option, past Chase reward programs and other card issuer programs have allowed consumers to exchange points for cash.

Recent cutbacks in rewards have alarmed heavy credit card users who enjoy the cash back, travel and merchandise rewards they can bring. Earlier this year, Chase stopped offering its Cash Plus Rewards card, which offered 5% back on gas and other purchases, while Citibank pulled its Citi Dividend card, which also offered 5% rebates on gas, groceries and other “everyday” purchases. American Express also discontinued double points rewards on similar purchases.

The format for IndexCreditCards.com’s Credit Card News section has changed.  To find articles previous to September 18, 2006, please use this legacy article archive.