Gas Credit Cards: Running Low on Fuel or a Good Way into Credit

by Brian Riley 0

gas

So many cards, so many decisions.  Are gas credit cards worth it?

  • Drivers can save at the pump with gas cards, but general cash back cards are better at re-fueling our wallets, according to a new CreditCards.com survey.
  • Our latest survey of 28 major gas station credit cards shows that while most offer some kind of fuel discount or rebate, the average per-gallon savings is 5 cents. That falls short when compared to general purpose cash back cards that offer 2 to 5 percent off at gas stations, even though the average gas price is low ($2.66 per gallon as of April 10, per AAA).

Is it worth having a specialized card for gas?  Add that to your general purpose card, you travel card, you major expense card, and whatever, the wallet starts getting fat.

  • “General purpose credit cards that give the customer an opportunity to use their miles and points have greater appeal versus credit cards that only accumulate rewards for spending at an individual gas station,” said Rahul Srinivasan, a marketing intelligence spokesman at LoyaltyOne.
  • Gas-branded credit cards appeared to fall out of favor with consumers in recent years. However, there’s evidence now that drivers aren’t quite ready to toss cards from their favorite gas station brands out of the window.
  • Research firm Colloquy reported in its 2015 Loyalty Census that fuel and convenience loyalty program memberships had fallen 3 percent to 24.5 million members from 2012 to 2014. But the firm’s latest report in 2017 showed a remarkable jump in the fuel and convenience category to 43.7 million memberships between 2014 and 2016.

Issuers cause part of the confusion, but think of the total value proposition, from rewards to fees and interest.  Forget the luster of big rewards and consider your credit card to be a financial product that carries benefits and expenses.

Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group

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