Kroger is one of the largest grocery chains in the United States, with more than 2,700 stores in 35 states. If you’re a dedicated shopper at one of the many stores in the Kroger ‘family’, you may be considering the Kroger 1-2-3 REWARDS® World Mastercard® for your frequent grocery shopping.
But even for Kroger’s loyalists, this card isn’t competitive, thanks to its mediocre, inflexible rewards and awkward redemption process. Most buyers would better investigate cash back credit cards, a number of which would be more versatile and more lucrative.
Here are five things to know about the Kroger credit card:
Nerd tip: Stores in the Kroger Family Co. include Kroger, but also Ralphs, Harris Teeter, King Soopers, Baker’s, Dillons, Smith’s Food and Drug, Fred Meyer and Gerbes, among others.
1. The rewards are poor and limited
The Kroger 1-2-3 REWARDS® World Mastercard®, issued by US Bank, allows you to earn the following rewards:
3 points per dollar spent on certain Kroger “own brand” products.
2 points per dollar spent at any Kroger-owned store (not including Kroger fuel centers).
1 point per dollar on all other expenses.
Discounts on eligible gasoline purchases.
Every 1000 points you earn equals $ 5 worth of free groceries at Kroger stores, meaning one point is worth half a cent each. That’s well below the industry standard of a dime per point, and that means even at the card’s highest 3x rewards rate, you only get back 1.5% which you can use towards purchases at Kroger stores. There is a lot of cash back credit cards with 1.5% cash back or higher on all expenses.
And about that 3x tier: it’s only for qualifying store brand products (Kroger, Simple Truth, Home Chef and Pet Pride, among others). If you don’t like Kroger’s private label products and go for Heinz, Hunt’s, or Hellmann’s instead, then you’ll have to settle for lesser rewards.
Many cash back cards offer better rewards and are much less restrictive about where and how you can earn them. Take into account $ 0-fee-annual Chase Freedom Unlimited®. It offers new cardholders 5% cash back at grocery stores (not just Kroger stores) for the first year, on spend of up to $ 12,000. After that, you go back to 1.5% in grocery stores – but in terms of point value, that equals or exceeds what the Kroger card can offer, even at its highest levels. And that doesn’t take into account the multiple other bonus categories featured on Freedom Unlimited. Plus, you can spend your money however you want, not just with just one brand.
2. Redemption is heavy and restrictive
Speaking of which, points earned through the Kroger 1-2-3 REWARDS® World Mastercard® cannot be redeemed for cash back. Rather, they accumulate towards “reward certificates” which can only be used in the Kroger family of stores.
Besides the lack of flexibility in rewards, there are other obstacles:
You cannot “accumulate” points: For every 1,000 points you earn, you will automatically receive a $ 5 rewards certificate to use at a store under the Kroger umbrella. That means you can’t save a large pool of points to use later, and it also means that if you only have 999 points, they’re not good for you yet.
You’ll have to wait: Reward certificates are only issued four times per year and are mailed to cardholders in February, May, August, and November. Any remaining points that do not qualify for a $ 5 certificate will be carried over to the next redemption period.
You are on the clock: Points expire after three years, and reward certificates have an even shorter timeframe: they must be used within one year of the date of issue. (They also cannot be redeemed at Kroger Fuel Centers).
While some of these restrictions come with the territory for store branded credit cards, this is not the most general way. rewards credit cards job. You can find plenty of them with no minimum redemptions required, no expiration date on rewards, and no need to wait in the mailbox every few months for a certificate that can only be used in certain stores.
Take the $ 0-fee-annual American Express Blue Cash Everyday® Card. He earns 3% cash back at US supermarkets – not just at Kroger stores – on up to $ 6,000 spent per year (then 1% back). This spending limit of $ 6,000 is well above what the average American household spends on groceries. And, again, you earn money, not points.
3. There is a separate fuel rewards program
If you get the Kroger 1-2-3 REWARDS® World Mastercard®, you will automatically be enrolled in the Kroger Customer Loyalty Program. (Credit card or not, membership is free and you can register online or at a Kroger-owned store).
As a member of the program, you will earn 1 “fuel point“for every dollar spent on groceries – with a few exceptions – at any store in the Kroger network. Here’s how the program works:
Fuel points can be redeemed at Kroger fuel centers and participating Shell petrol stations. At Kroger Fuel Centers, you can redeem up to 1,000 fuel points for $ 1 off per gallon. (You can redeem in 100 point increments, up to 35 gallons.) At qualifying Shell stations, you can redeem 100 fuel points for 10 cents per gallon.
There is no limit to the number of fuel points you can earn each month. But these points do not carry over and instead expire on the last day of the month after being earned.
Aside from fuel points, if you have the Kroger credit card, you can also receive an ongoing 5 cents per gallon reduction at eligible Kroger fuel centers. But in terms of credit card points on those fuel purchases, you’ll still be rewarded at the card’s base rate (1 point per dollar spent). And the reward certificates you earn with the card cannot be redeemed at Kroger Fuel Centers.
Nerd tip: Not all Kroger grocery stores in the United States have fuel centers where you can pump gas and redeem fuel points. Kroger’s Fuel Locator can help you find the nearest fuel centers to you.
4. There is a two-part sign-up bonus
The Kroger 1-2-3 REWARDS® World Mastercard® offers the following welcome offers:
Until January 15, 2021, the card offers 5% cash back in the form of statement credit, on up to $ 2,500 in purchases, within the first three months of account opening. If you were to maximize this, you would earn $ 125. It’s okay, but many cash back credit cards offer bonus of $ 150 or more for much less expense.
New entrants will also receive 25 cents off per gallon of gasoline, up to 35 gallons per fill, during the first year of card use. To qualify for the discount, you will need to redeem at least 100 Fuel Points, when scanning your card, at eligible Kroger Fuel Centers. (The rebate drops to 5 cents per gallon after the first year.) If you drive a lot, this can save you quite a bit of gasoline savings, although tracking and redeeming fuel points can be quite expensive. maintenance.
Nerd tip: The 25 cents per gallon discount offer is not available in Louisiana or Missouri.
5. Try to avoid having a balance
Having a balance with this card would eat away at any rewards or discounts you would get.
Information about the Kroger 1-2-3 REWARDS® World Mastercard® was collected by TBEN and was not provided or reviewed by the issuer of these cards.