Who Offers Rebate Credit Cards

Credit cards are offered by several different types of organizations. To gain a better idea of what types of organizations offer rebate credit cards, just keep reading.

Single Issuer Cards

Most credit cards are issued by banks. Discover cards are mainly issued by Discover Bank, and American Express cards are issued by American Express. The other most prominent cards—VISA and MasterCard—have multiple individual issuers, and are distributed by financial institutions from around the world.

In the United States, the top card offers for VISA and MasterCard are generally from the following:

• JPMorgan Chase One of the largest and oldest US banking institutions, JPMorgan Chase was formed in 2000 by the acquisition of J,P Morgan & Co. by Chase Manhattan Corporation. A merger with Bank One in 2004further built the company. They issue credit cards with the Chase name.
• Citigroup Inc Formed by the merger of Citicorp and Travelers Group, Citigroup’s credit card services form one of the four divisions of its Global Consumer Group (GCG). Citi Cards issues the most credit cards of any organization worldwide.
• Capital One Financial Corp.  Founded in 1988, Capital One acquired several banks and became Capital Bank One. It is known for offering cards to high risk customers, as well as for outside-the-box advertisements.
• Bank of America Corporation was formed in 1997 when BankAmerica Corp. was purchased by NationsBank Corp. It then acquired National Processing Company and FleetBoston Financial in 2004 and MBNA in 2006. MBNA had specialized in affinity cards (see below), but Bank of America is terminating those schemes

Other desirable cards are offered by Fidelity Investments, HSBC, and Merrill Lynch.

Co-Branding

Co-branding is a means through which two different organizations share sponsorship of a card with the goal of benefiting both. There are several different categories of co-branding, and the one used with credit cards is called multiple sponsor co-branding.  One of the sponsors is the organization that offers the card and the other is usually a merchant. This is different than the association between a particular bank and a card (like a Citibank VISA or an HSBC MasterCard), which is simply the card issuer and the type of card.

So, for example, American Express and Costco have a co-branded card and an agreement that the American Express card is the only one accepted at Costco Warehouses. Co-branded cards can, however be used at others merchants besides the sponsor.

On account of the customer’s original choice to get a co-branded card, and with incentives tied to the merchant who co-sponsors the car, the card issuers can both count on and work to build customer loyalty. Merchants also benefit by not having to create their own private-label card nor deal with the processing and other costs associated with providing credit to customers, because the credit card company provides that part of the partnership. It’s also an opportunity to transfer a customer’s loyalty from one brand to another by association.

Affinity Cards

Affinity cards are cards offered by a bank or credit card company in conjunction with another institution whose membership is targeted by the card. The institution endorses the program and provides a mailing list and receives in return a small percentage of each transaction on the affinity cards. Affiinity programs build on customer loyalty to the institution and extend that loyalty into the realm of finance.

Begun by MBNA before it was acquired by Bank of America, the institution involved in the affinity card was originally a charity, a non-profit organization, a university, or a professional group. But sports teams, locations, and other, looser associations have also been targeted.

Affinity cards are generally Visa or MasterCard, according to one source. They may offer rewards to the customer in the form of points or some other scheme in addition to subsidizing the institution with which they are associated.

People considering an affinity card often note that it is an easy way to make donations, but you should know that you won’t be able to get credit for your contribution on your income taxes, for example, as you would if you wrote a check. You also have less control than with a check over how the money is used.