Featured Post

Amazing new welcome offer for the HSBC World Elite Mastercard - Up to 100,000 points with first year free! (Quebec gets 130,000 points with fee)

HSBC has just come out with their biggest and best offer yet for the HSBC World Elite Mastercard and in fact the bonus for Quebec resident...

Tuesday, October 28, 2014

Credit Card Showdown: mbna SmartCash World MasterCard vs. American Express SimplyCash Card

Welcome to Rewards Canada's second ever credit card showdown. We tested this concept a little over a year ago in this type of showdown but haven't done one since. Now we hope to make it a more frequent feature here on Rewards Canada. With Cash Back credit cards becoming more popular and more of our readers asking us about them we figured we would compare two of the top no fee based cash back cards, the mbna SmartCash World MasterCard and the American Express SimplyCash Card. (Don't worry, we'll have a fee card showdown coming soon as well!) Like the previous showdown I am writing this piece with the intent that the reader has at least some knowledge of the cash back process and credit card reward programs. You don't have to be an expert but if you are new to the rewards game some of this may not make sense to you. Also know that there are other cash back cards that may work better for you but we have set up this feature like a boxing match so we only compare two cards but those two are typically very popular or at the top end of the offerings in the Canadian market.

Annual Fees / Sign Up Bonus

Both cards match up here as they are no fee for the primary and supplementary cards. Both have a sign up bonus of 5% cash back in select categories for the first 6 months you have the card. The mbna SmartCash World MasterCard is for Gas and Grocery only while the SimplyCash card is for Gas, Grocery and Restaurants. Since the mbna maxes this bonus out $400 in spend per month the American Express SimplyCash is the winner in this category since it maxes the bonus at $250 of bonuses ($833.33 in spend per month). The SmartCash World MasterCard does require $60,000 personal annual income or $100,000 household. You can always look at the Platinum version of the SmartCash card which requires $35,000 annual income, still $20,000 above the SimplyCash. The Platinum also caps all spending $1,250 per month that you can earn a cash back return on.

Interest Rate:
Once again American Express is the leader here but barely, a 0.24% difference over the mbna SmartCash World MasterCard. Either way this shouldn't matter as if you have one of these cards you shouldn't run a balance for more than a couple of months otherwise your screwing yourself. If you do you should look at a low interest card or no card at all.


Cash Back Earning
I'll tell you one thing, Cash Back earning is easier to compare than travel rewards but it isn't as easy as you think. Many of the cash back cards out there offer category bonuses and tiered spending cash back percentage increases which can make side by side comparisons difficult. There are some cards however that make it easy by having a flat cash back rate on spending . Outside of the first 6 months bonus, the SimplyCash makes it easy by being 1.25% on all spending versus the SmartCash's 2% on Gas and Grocery up to $400 per month spending then followed by a 1% return.

The basic earn rates for the cards are 1.25% on the SimplyCash while the SmartCash is 1% outside of the Gas and Grocery bonus.

Spend Comparison
Here are our spend comparisons of these two cards. We take into account the first 6 month sign up bonuses and the SmartCash's 2% on $400 at Gas and Grocery stores. As you can see the SimplyCash is the clear leader between these two cards.

$20,000 per year - Year 1
mbna SmartCash World MasterCard SimplyCash™ from American Express®
Cash Back Cash back
Gas 10% $2,000 $135.96 in the first six months based upon half of the spend completed

$63.96 on the remainder of spend
$50 in the first six months based upon half of the spend completed

$12.50 on the remainder of spend
Grocery 30% $6,000 $150 in the first six months based upon half of the spend completed

$37.50 on the remainder of spend
Restaurant 10% $1,000 $10 $25 in the first six months based upon half of the spend completed

$6.25 on the remainder of spend
All other spending 50% $7,000 $70 $87.50
Total Cash Back $279.92 $368.75
$20,000 per year - Year 2 and beyond
mbna SmartCash World MasterCard SimplyCash™ from American Express®
Cash Back Cash back
Gas 10% $2,000 $96 based on the 2% for the first $400 per month

$31.92 on the remainder of spend
$250
Grocery 30% $6,000
All other spending 60% $12,000 $120
Total Cash Back $247.92 $250
$40,000 per year - Year 1
mbna SmartCash World MasterCard SimplyCash™ from American Express®
Cash Back Cash back
Gas 8% $3,200 $172.02 in the first six months based upon half of the spend completed

$100.01 on the remainder of spend
$80 in the first six months based upon half of the spend completed

$20 on the remainder of spend
Grocery 30% $12,000 $170 in the first six months based upon half of the spend completed

$107.50 on the remainder of spend
Restaurant 10% $3,200 $32 $40
All other spending 52% $17,600 $176 $220
Total Cash Back $480.03 $637.50
$40,000 per year - Year 2 and beyond
mbna SmartCash World MasterCard SimplyCash™ from American Express®
Cash Back Cash back
Gas 8% $3,200 $96 based on the 2% for the first $400 per month

$104 on the remainder of spend
$500
Grocery 30% $12,000
All other spending 62% $24,800 $248
Total Cash Back $448 $500
$60,000 per year - Year 1
mbna SmartCash World MasterCard SimplyCash™ Card from American Express®
Cash Back Cash back
Gas 8% $4,800 $195 in the first six months based upon half of the spend completed

$246 on the remainder of spend
$250 in the first six months based upon half of the spend completed

$185 on the remainder of spend
Grocery 25% $15,000
Restaurant 10% $6,000 $60 $75
All other spending 57% $34,200 $342 $427.50
Total Cash Back $843 $937.50
$60,000 per year - Year 2 and beyond
mbna SmartCash World MasterCard SimplyCash™ Card from American Express®
Cash Back Cash back
Gas 8% $4,800 $96 based on the 2% for the first $400 per month

$150 on the remainder of spend
$750
Grocery 25% $15,000
All other spending 67% $40,200 $402
Total Cash Back $648 $750

Of course your spending may be different, if you don't spend very much overall the SmartCash may be better for you because of the 2% cash back on Gas and Groceries up to $400 per month. If your card isn't going to be used for Gas or Groceries because you have another card you primarily use at those places then the SimplyCash would be the better bet as it earns the 1.25% versus the SmartCash's 1%. Also you'll want to look at where you plan on using your card since the SmartCash is a MasterCard which has a higher acceptance rate over the SimplyCash card. However when you look at the numbers above we have to say the clear winner is the American Express SimplyCash card in terms of cash back earning.

Benefits
The last factor to look at when comparing these cards are the benefits that come with the cards. This section is easy as the mbna SmartCash World MasterCard offers more benefits than the SimplyCash card.. It provides a higher travel accident insurance amount, has trip interruption insurance, offers price protection and concierge service. The mbna SmartCash is the clear winner in this category.

Conclusion
Based on the spend comparison above, our comparison chart below and what we believe to be general spending habits of Canadians, the American Express SimplyCash is the winner in this Credit Card showdown. Many no fee Cash Back cards tend to be secondary or tertiary cards for Canadian's who tend to hold Travel Rewards cards as their primary cards so they usually don't need the insurance benefits provided with these card. However for those who don't have Travel Rewards cards but do some travelling they may want to look at the mbna SmartCash World MasterCard because of its benefits but should take into account the loss of cash back by perhaps looking at third party travel insurance combined with the SimplyCash card to see which card or card+travel insurance combination will give them the best return.

Chart Notes: Yellow highlighting signifies a clear winner in that category


Feature / Card
mbna SmartCash World MasterCard
SimplyCash™ Card from American Express®
Fees etc.
Annual Fee
$0
$0
Supp. Card Fee
$0
$0
Interest Rate
19.99%
19.75%
Foregn Exchange Transaction Fee
2.5%
2.5%
Minimum Income
$60,000 Personal or $100,000 Household
$15,000
Cash Back
Card

mbna SmartCash World MasterCard
SimplyCash™ Card from American Express®
Earning Ratio
1% Cash back on all purchases
1.25% Cash back on all purchases
Maximum Annual Cash back limt
Unlimited
Unlimited
Category Bonuses
Card

mbna SmartCash World MasterCard
SimplyCash™ Card from American Express®
Grocery
5% for the first 6 months, 2% thereafter*
5% for the first 6 months, 1.25% thereafter*
Gas
5% for the first 6 months, 2% thereafter*
5% for the first 6 months, 1.25% thereafter*
Restaurant
N/A
5% for the first 6 months, 1.25% thereafter*
Benefits
Card

mbna SmartCash World MasterCard
SimplyCash™ Card from American Express®
Travel Accident Insurance
$1,000,000
$100,000
Trip Interuption Insurance
Yes
No
Auto Rental/Loss Damage Insurance
Yes
Yes
Price Protection
Yes
No
Purchase Protection
Yes
Yes
Extended Warranty Plan
Yes
Yes
Concierge Service
Yes
No
Link to Apply
Apply Online 
Notes:
* On the first $400 spend in each month, anything above is at 1%
Up to $250 total


Do you have a suggestion at a credit card showdown? Comment below on what two cards you'd like to duke it out!

Advertisement

No comments:

Post a Comment