Capital One Financial has added REI Co-op, the outdoor equipment retailer, to its growing group of co-branded retail credit card partners which includes walmartSaks Fifth Avenue and Williams Sonoma.
Capital One will retain some core features of the existing REI card, a Mastercard previously issued by US Bank, including 5% cashback on purchases at the 177 REI stores. It increases rewards on all other purchases to 1.5% from 1%, the company said in a press release.
But Capital One will no longer refund 2% to REI credit card users for paying with a mobile wallet, a feature of US Bank – a unit of US Bancorp – introduced in 2019. Capital One executives did not give a reason to give up the advantage.
Analysts said mobile wallet usage may have gained enough momentum to thrive without incentives.
“An incentive is generally only dropped if it costs too much for the value, or if the value is not enough to drive demand. It may be that with the increase in wallet usage created by the pandemic, there is no reason to provide an incentive for incremental use,” said Thad Peterson, strategic advisor at Aite-Novarica.
US Bank and some other issuers continue to offer consumers additional rewards for paying with mobile wallets. The US Altitude Reserve Visa card rewards users with 3X points for every dollar spent using a mobile wallet, and US Bank-issued Kroger Mastercard users can earn up to 5% back for mobile wallet purchases.
JPMorgan Chase offered up to 5% cash back to Chase Freedom credit card users who paid with mobile wallets, and the Apple credit card issued by Goldman Sachs offers users 2% cash back in Apple Daily Cash with every purchase made with Apple Pay using an iPhone. or Apple Watch.
To further refresh the REI card, Capital One is manufacturing all-new REI cards from 85% recycled materials, underscoring REI’s commitment to sustainability. REI card users can also receive 5% rewards for donations made to the REI Cooperative Action Fund, a non-profit organization supporting justice, equity and belonging in the outdoors. Capital One will also provide an annual donation to this fund, according to the statement released Monday.
Other REI card features that continue under Capital One include no annual fee and the opportunity for new customers to earn a $100 REI gift card by making any purchase with the card within 60 days of purchase. opening an account.