NEW YORK (AP) ? Bank of America is the latest of the big banks to offer a credit card with a cash back reward that escalates for certain types of shopping.
Customers who get a BankAmericard Cash Rewards Visa card earn cash back on all purchases, but the percentage climbs depending on what they’re buying. For most spending, the reward is 1 percent of the price. For grocery store purchases, the reward increases to 2 percent, and for gas, it’s 3 percent.
The tiered rewards were designed to reflect customer behavior, said Bank of America Consumer Banking Products Executive Susan Faulkner. About one-third of all the credit card transactions that Bank of America handles are for gas or groceries.
There’s a limit on those higher percentages, however. They apply only to the first $1,500 in gas and grocery purchases every three months.
Customers who use the account for at least $100 in purchases in the first two months the account is open will receive an extra $50 bonus.
Individuals who have their rewards deposited into a Bank of America checking or savings account will get an additional 10 percent bonus.
The fine print
The card offers an introductory interest rate of 0 percent for the first 12 statements, after which the interest will switch to a variable rate based on the prime rate ? between 12.99 percent and 20.99 percent, depending on credit status. Cash advances from ATMs or bank tellers will carry a 24.99 percent interest rate. Late payments can trigger a rate of up to 29.99 percent.
Bank of America is offering a MasterCard with a similar tiered rewards structure, offering 1 percent cash back on all purchases, 2 percent on restaurant purchases and 3 percent on office supply store, gas station and computer network service purchases. There is no cap on the purchases categories for the business card, but there is also no bonus for depositing rewards into savings or checking accounts.