Posted by: John S Kiernan

EDITOR’S RATING 5 / 5 PROS

• $10 gift certificate upon account approval
• 5% cash back for Amazon Prime members
• No annual fee
• 0% financing for 6-24 months

CONS

• 0% offers include dangerous deferred-interest clause
• High regular APR

The Verdict: It all comes down to your credit standing and whether you’re willing to pay $99 a year for Amazon Prime. If you’re not already a member or you’re unwilling to join, stop reading and instead consider the Amazon.com Credit Card. The store-only version won’t give you anything but a $10 gift certificate.

But anyone with a Prime membership should waste no time in submitting an application, as that status scores you an upgrade to the Amazon Prime Store Card and 5% cash back on every purchase that you make, redeemable for a statement credit. That’s an excellent deal, and our overall rating for this card assumes that you qualify.

It’s best if you pay for your bill in full each month, too. This card’s 28.24% (V) regular APR won’t do you any favors, for one thing. And if you decide to avail yourself of 0% introductory financing — available for six to 24 months, depending on the amount of your purchase — you’ll have to give up rewards privileges and confront the “deferred interest” clause buried in the fine print.

Below, we’ll explore the Amazon.com Store Card in more detail and take a closer look at how it compares to the Visa version.

The Highlights

• $10 Signup Gift Certificate: The only reward you’re guaranteed to earn with the Amazon.com Store Card is the $10 gift certificate that will be loaded to your account automatically upon approval of your application. Fortunately, there’s plenty you can buy from Amazon.com for $10 or less. 

• 5% Cash Back For Prime Members: Earning 5% back on every Amazon.com purchase could save you a lot of money if you’re a frequent shopper. That’s why it has to be considered a highlight.But the caveat that you must be a Prime member effectively puts a $99 annual price tag on that earning rate, thus limiting its value to current subscribers and people who spend at least $1,980 per year on Internet shopping and corresponding shipping costs. That’s the amount at which you’d earn $99 with the 5% rate.

  It’s also important to note that purchases that you pay for under the terms of a promotional financing offer are not eligible to earn rewards. In other words, you must choose between 5% cash back and the special financing rate. 

• No Annual Fee: The lack of a yearly membership charge certainly is good news for your wallet, but this particular account attribute should have an asterisk next to it. Yes, the card can be free to use, which makes it conducive to cost-effective credit building. But if you want rewards, you would need to sign up for Amazon Prime membership first, which is like paying a $99 annual fee. 

The Lowlights

• 0% Deferred-Interest Financing: This particular feature of the Amazon.com Store Card could go very well for your wallet, but it could also end terribly. The deal gives you a special 0% promotional financing rate for six months on purchases of $149 to $598; 12 months on purchases of $599 or more; or 24 months for “select” Amazon.com items that currently include only HDTVs and video projectors sold by Amazon.com (excluding third-party sellers). Other deals may be available from time to time as well.If you pay your bill on time every month and pay off your entire balance by the end of the promotional period, you’d save money relative to the average credit card. But if you pay your bill late or leave even a dollar balance unpaid when regular rates take effect, the card’s 28.24% (V) APR will retroactively apply to the amount of the original purchase that you financed. That would leave you with surprisingly high costs, which ultimately could lead to missed payments and credit-score damage.

  We consider this to be too big of a risk to take in light of the numerous available 0% credit cards that do not use such underhanded pricing tactics.

• High Regular APR: Despite its Amazon.com branding, this probably isn’t the best card with which to make big-ticket purchases on the site. Not only do its 0% financing terms include a dangerous deferred-interest clause, but the stakes associated with screwing up are also higher, thanks to the card’s lofty 28.24% (V) regular APR. To put that in perspective, the average credit-card offer charges 19.26%, and the average store credit card charges 25.76%, according to WalletHub’s latest Credit Card Landscape Report. 

• No Regular Rewards For All Cardholders: Simple possession of an Amazon.com Store Card does not automatically correlate with rewards. You have to pay for that privilege once you’ve been approved. It is either a no-annual-fee credit card or a rewards credit card, but it can’t be both.

Other Things To Consider

• Low Credit Approval Standards: As previously mentioned, this card’s relatively low approval threshold makes the card attainable for Amazon.com users who can’t qualify for the store’s Rewards Visa. Together with the store card’s lack of an annual fee, the modest approval requirements also open the door to people who may not even care about online shopping. Simply having a credit card such as the Amazon.com Store Card will result in positive information being added to your credit report each month and your credit score consequently rising — assuming you use the card responsibly. 

• No Smart Chip: Most credit cards these days come with an embedded computer chip that helps to protect users, merchants and card issuers from fraud. The Amazon.com Store Card is not one of them. But that ultimately doesn’t matter to you, as all credit cards guarantee users of $0 liability for unauthorized transactions.This might be too inside baseball, but the card’s lack of an embedded chip basically means that Amazon (rather than the card network) is liable for any fraud perpetrated with the card. But given that this card can be used only at Amazon.com, it seems the Internet retail behemoth is confident in its ability to prevent card fraud itself.

Compared To The Competition

Amazon.com may dominate U.S. retail, but the credit-card landscape is far more competitive. Shopping around for the card that you’ll ultimately shop with is therefore essential. To help you out, we compared the Amazon.com Store Card not only to its Visa sibling but also to other cards for people with fair/limited credit that offer everyday savings. You can check out our conclusions below.

	Amazon.com Store Card	Amazon.com Credit Card	Walmart® Credit Card	Target Credit Card
Annual Fee	$0	$0	$0	$0
Rewards Bonus	$10 gift card	$50	$25 discount	N/A
Rewards Rate	0 - 5% Cash Back	1 - 3 points / $1	1 - 3% Cash Back	5% Cash Back
Purchase Intro APR	0% for 6 - 24 months	Not Offered	Not Offered	Not Offered
Transfer Intro APR	Not Offered	Not Offered	Not Offered	Not Offered
Regular APR	28.24% (V)	16.49% - 24.49% (V)	18.9% - 24.9% (V)	25.15% (V)
Editors’ Rating	5.0 / 5	4.5 / 5	2.5 / 5	5.0 / 5
Details, Rates & Fees	Learn More	Learn More	Learn More	Learn More
Winners	Amazon.com Store Card		Amazon.com Credit Card

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