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Friday, October 23, 2020

Changes coming to CIBC's cash back Dividend cards on February 1, 2021

 


CIBC reached out to us yesterday to let us know they are revamping their suite of cash back credit cards. These are the cards better known as their Dividend Cards and all the cards in the portfolio are seeing an update. There are both positive and negative and negative changes being applied to all the cards. We'll delve into those individual changes below but the most important change that is portfolio wide is a great one! You will be able to redeem your cash back balance from any of these cards at any time now so long as your cash back balance is at $25! This is the same redemption option seen on the TD Cash Back Visa Infinite* Card and it is welcome change! If you are familiar with the Dividend Card(s) you'll know that your cash back rewards balance is only available once per year but that all changes February 1st. Called On Demand Redemption CIBC Clients can redeem their cash back anytime as long as their account is open, in good standing, and they have a minimum of $25 in cash back. You will be able to redeem cash back at any time through the CIBC mobile app or online.

We've seen a major shift from that once per year reward to almost anytime access to your cash back in our market over the past few years with CIBC, Scotia and American Express being the big player hold outs from moving to the new redemption style for cash back. Now you can take CIBC off that list!

Now onto the individual card changes. The first is CIBC's flagship cash back card, The CIBC Dividend Visa Infinite Card. This card was already quite good - in fact we ranked it as the number one cash back credit in Canada in our latest rankings! And now for the most part the card gets even better. 

The card will keep it's 4% earn rate of gas and groceries but sees its 2% category get better as you'll earn that rate on all transportation, dining purchases and recurring payments - compare this to the current 2% on Tim Hortons and TELUS purchases. That category will be much better however you do have to be aware the card retains its $20,000 spend cap in total for those categories which does mean some cardholders will hit that cap faster now. They will also be adding mobile device insurance to the card. The negatives happening to the card are that it sees its annual fee bumped up to what other Visa Infinite cards are charging of $120. This is up $21 from the current $99. Hopefully the better 2% category will make up for that difference for most cardholders. Also the card is seeing a hit to its travel insurance. Out of province medical drops from 15 to 10 days and it loses trip interruption, flight delay and baggage insurance. While it's never good to see benefits pulled, given today's market and that fact this is a cash back card and not a travel card I don't consider these a huge loss.

 


CIBC Dividend Visa Infinite Card

 New features

Current

Effective February 1, 2021

4% cash back on gas and groceries

 

4% cash back on gas and groceries

 

2% cash back on Tim Hortons and TELUS purchases

 

2% cash back on transportation, dining purchases and recurring payments

 

1% cash back on everything else

 

1% cash back on everything else

 

 

Annual fee

Primary Cardholder: $120 (previously $99), Authorized Users remain at $30 per card

 

Insurance benefits

NEW: Mobile Device Insurance

Changes to Existing Insurances: Out of Province Travel Medical Coverage reduced from 15 days to 10 days. Trip Interruption Insurance, Flight Delay & Baggage Insurance has been removed. 

 

The other two cards in the portfolio don't do as well with the changes. Yes they get the on demand redemption option but their changes in my opinion come out to making the cards equal to what they are now (the Platinum version or worse (the base level card).  Their changes outside of the on demand redemption come solely on earn rates. The Platinum card sees its 4% on cash back and grocery being cut to 3% but it does gain 2% on all transportation, dining purchases and recurring payments - compare this to the current 2% on Tim Hortons and TELUS purchases. The rest of the purchases remain at 1%. This is where I think the card equals out - it loses that 1% on two categories but gains a percent on three categories. 

The base level card however takes the biggest hit I would say. It retains 2% on groceries, gets a boost to 1% on all gas transportation, dining purchases and recurring payments but then has it's base earn rate drop to 0.5%. The card has this 0.5% rate but that was only on the first $6,000 of spending then it jumps to 1%. Now it will simply be 0.5%.

 


CIBC Dividend Platinum Visa Card

 

New features

Current

Effective February 1, 2021

4% cash back on gas and groceries

 

3% cash back on gas and groceries

 

2% cash back on Tim Hortons and TELUS purchases

 

2% cash back on transportation, dining purchases and recurring payments

 

1% cash back on everything else

 

1% cash back on everything else

 

 



CIBC Dividend Visa Card

 

New features

Current

Effective February 1, 2021

2% cash back on groceries

 

2% cash back on groceries 

 

0.5% cash back on the first $6,000 in other purchases

 

1% cash back on other purchases over $6,000

1% cash back on gas, transportation, dining and recurring payments

 

 

0.5% cash back on everything else

 

 

Even though there both pros and cons to the revamp on the CIBC Dividend cards I would say these changes lean more to the positive side than negative side. Especially so for the top end Dividend Visa Infinite card - it was a strong card to begin and it just got stronger. I think Scotia and Amex will have to take a long hard look at their cash back redemption being limited to once per year - they are the only two hold outs left and that once a year reward should now be considered a thing of the past.

What do you think of these changes? Let us know in the comments below!

Learn more about the changes here plus find the complete details of each of these cards on the Rewards Caanda CIBC page.

Images via CIBC


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