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Tuesday, June 18, 2019

Details on the newly launched MBNA Amazon.ca Rewards Mastercard

 MBNA (and parent company TD) along with Amazon announced today the launch of a new Amazon.ca Rewards Mastercard. You may remember there used to be an Amazon.ca co-brand credit card up until early 2018. That old card, a Visa, was issued by Chase Bank (who have now left the Canadian market) and was very popular thanks to its no annual fee combined with no foreign exchange fee.

It is exciting to see the return of an Amazon card but the questions many will ask is "how does it compare to it's yesteryear option"  Let's start by looking  the main details of the new Amazon.ca Rewards Mastercard:

  • For the first six months after your Amazon.ca Rewards Mastercard account is opened, you will receive 5% back on eligible purchases at Amazon.ca, Whole Foods Market stores in Canada and at grocery stores or restaurants in Canada, until $3,000 in such purchases have been made.
  • 2.5% back on eligible purchases at Amazon.ca, Whole Foods Market in Canada and on foreign currency purchases, with an eligible Prime membership
  • Otherwise 1.5% back at Amazon.ca and Whole Foods Market in Canada
  • 1% back on all other purchases
  • No annual credit card fee
  • No annual points caps and no expiration date for points
  • Every 2,000 points earned are automatically redeemed as a $20 Amazon.ca Gift Card that can be applied on millions of items when shopping at Amazon.ca
  • Protection benefits include 90-day purchase assurance coverage, extended warranty and trip interruption coverage
  • Mastercard contactless-enabled for a frictionless checkout – simply tap your card at participating merchants in millions of locations across the globe to process payments securely 
Right off the bat you see the card has a pretty decent sign up bonus and and then you'll see it has a pretty good return - if you are an Amazon Prime member. The 5% back for the first $3,000 in spending ($150 return) is good sign up bonus for a no annual fee cash back card. The 5% is limited to Amazon, Whole Foods, and for Grocery Store and restaurant purchases in Canada so for most it should be no problem hitting $3,000 in 6 months to earn the full $150.

You can also tell in development of this card by MBNA, TD and Amazon that they really wanted to focus the card on Amazon purchases. Not many cards will give you a 2.5% return on Amazon.ca purchases (at least directly with Amazon, there are workarounds like buying Amazon gift cards at grocery stores to earn up to 5% back with other cards) The card with the sort of return will definitely be popular with the Amazon Prime members who are frequent Amazon purchasers. Next the card also earns the 2.5% back on Whole Foods purchases. This is a specific benefit to those living in the Toronto and Vancouver primarily as Whole Foods only has 14 stores in Canada of which 12 are in those two city regions. Of course now we get to the big question, what about the foreign transaction fee. Well the card charges a 2.5% foreign transaction fee and rewards you with 2.5% in rewards on foreign currency purchases so it is a wash. If the No FX fee is your prime goal than you are better offer with other cards in our market that don't charge the fee and still reward you over and above that. See our feature No Foreign Transaction Fee Credit Cards for Canadians for complete details on those cards! And let me remind you the one big caveat to this entire paragraph - those earn rates are only available to Amazon Prime members. Not a Prime Member? You'll get 1.5% back on Amazon.ca purchases and Whole Foods purchases in Canada.  All other purchases on both cards will earn 1%. All of this is with no annual fee. 


All those returns are detailed as percentage but you are actually awarded points and when you reach 2,000 points it will automatically be redeemed for a $20 Amazon.ca Gift Card. That means I would classify this card as a retail cash back card since in the end you are getting cash back but that cash back can only be used at one retailer, Amazon. Again you see how specific this card is as you can only get rewarded at Amazon, not that it is bad thing, that's what co-brand cards are meant to be but unless you are a major, almost full time user of Amazon.ca you are likely better off with other cards in our market that don't limit your high earn to one or two retailers and limit your rewards to only one place. The old card worked well since the 2,000 points earned automatically became a $20 statement credit so it was in fact a true cash back card.

As you can see Amazon et al. have narrowed the focus of who they want using the card. The higher earn for Prime Members, the Amazon.ca gift card reward and elimination of the foreign transaction fee really limits this card's audience to heavy Amazon users. Not a heavy Amazon user? You have a lot of better options out there for you. 

Learn more about the Amazon.ca Rewards Mastercard here!



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