Apple is the world’s strongest brand, worth over $124 billion. While this is more than twice as much as the next-most valuable brand, credit card experts have always wondered why it hasn’t offered a rewards credit card to leverage this market strength.
Apple and Barclaycard have just released the new Barclaycard Visa with Apple Rewards that finally offers Apple fans rewards in the form of Apple store gift cards.
How This Card Works
Customers can apply for this card online or at Apple stores, and receive deferred-interest financing on their Apple purchases. This means that interest accrues at the standard rate, and will be waived only if cardholders pay off their entire purchase within the promotional financing period. If they fail to pay off their entire purchase in time, they will have to pay all interest charges on their average daily balance since the day of the purchase. Six months of deferred-interest financing is offered for purchases below $499, 12 months for purchases between $499 and $998, and 18 months for purchases of $999 or more.
In addition, this card also offers three points in the Apple Rewards program for every dollar spent on purchases made directly from Apple at Apple stores, online or over the phone. Double points are earned from dining and one point is earned for each dollar spent on all other purchases. Once 2,500 points are earned, cardholders receive a $25 Apple gift card.
How It Stacks Up Against Competitors
This card’s rewards program is similar to other retailers’ rewards cards. While it offers a strong three points per dollar spent for Apple purchases, and double points at restaurants, the one point per dollar earned on all other purchases is the bare minimum that any rewards card should offer. And like most retail store cards, there are more competitive rewards offered by other, non-store cards, like Barclaycard’s own Arrival Plus which offers double miles on all purchases, worth over 2% of spending toward travel rewards.
But what really distinguishes the Apple Rewards card from other store cards is not what it offers, but rather what it doesn’t. Unlike most other popular retail credit cards, the Apple Rewards card doesn’t offer customers valuable coupons or special perks. One can only imagine the flood of applications for this card that would have occurred if Apple offered its raving fans an early opportunity to purchase its latest products, or even a chance to attend special events at Apple stores.
Yet the most puzzling thing about this card is the deferred financing terms. With most promotional financing offers from non-retail credit cards, customers receive true 0% APR on their purchases, and interest only begins to accrue once the promotional financing expires. Yet with this card, customers face an all-or-nothing proposition. Either they pay off their purchases in full and on time, and avoid all interest charges, or they must pay all interest charge from day one if their payment is a dollar short or a day late. With this type of deferred financing offered by the Apple Rewards card, customers are making a high-stakes bet with themselves that they can pay off their entire purchase before the promotional period expires. That can pay off if you do it correctly, and hurt your wallet if you don’t.
However, you don’t need to be an economist to understand Apple’s amazing brand strength, which by itself should enable this card to succeed no matter how it compares to its competitors.
At publishing time, the Barclaycard Arrival Plus credit card is offered through Credit.com product pages, and Credit.com may be compensated if our users apply and ultimately sign up for this card. However, this relationship does not result in any preferential editorial treatment.
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