New Chase Credit card is Brewing
It’s been a while since we’ve seen a “new” credit card come down the line. Sure, there’s a new Ultimate Rewards card (the Sapphire Reserve) or a new Hilton Card (the Aspire Amex) or even a new US Bank card (Altitude) but a new card with new benefits? That’s been the unicorn in the credit card space for a while.
The Retail Sector
Partnerships between corporations and banks have been around forever. Airlines and Hotels have had a cozy relationship with credit cards for decades, and in the past few years we’ve seen an expansion of new credit cards. The Costco credit card is one of the most popular non-airline cards I know of, and Uber just rolled out their new offering.
Having a joint partnership can be an incredibly lucrative benefit for corporations, and banks usually pay heavily for the right to have that branding partnership.
Well, now Starbucks wants to join the fun! This was JUST announced on their earnings calls yesterday. Here’s the quote from the transcript:
The next major application of this new technology platform will enable the launch of financial services products in the US in conjunction with Chase. We are pleased to announce that our first product with Chase to be launched this winter will be a co-branded Visa credit card, enabling customers to receive Starbucks Rewards with their purchases both in and out of Starbucks stores.
Cash Back Style or Points?
For those not familiar with how Starbucks Rewards works, here’s a quick rundown. For each dollar you spend at Starbucks you earn two stars. Once you hit 125 stars, you get a free drink. Pretty easy, right? That’s a free food or drink item for each $62.50 you spend. If your drink is around $5-6 then you’re getting around an 8-9% return on your Starbucks purchases. If you’re a heavy Starbucks customer, that’s a good deal.
We’re not sure how Starbucks is going to reward customers using the card, but I would imagine that it’ll be something like 1 star per $5 spend on your card at Starbucks and 1 star per $10 spend outside of Starbucks. If you think about it like that, you’d have to spend $625 to get a free drink at Starbucks. If most cards give you a 1% cash back, then that’s around $6.25 for using an alternate card. It’s not the best return on your “investment” but if you REALLY like coffee or Pumpkin Spice Lattes, this could be awesome for you.
Keep watching this space for news about when the card comes out, but I can imagine that it’ll hit within the next month or two. If it’s worth it, we’re in… but for now just the the idea brew in your head a bit.