One-third of Canadian credit cardholders prefer cash back:
RBC launches new rewards card with a grocery bonus
TORONTO, June 14, 2010 One size does
not fit all Canadians when it comes to credit card reward
choices. A recent RBC poll shows that one-third (33 per cent)
of Canadian cardholders prefer cash back over any other type
of incentive, including merchandise (27 per cent) and travel
rewards (23 per cent).
"While travel and merchandise rewards remain popular,
many Canadians want a straightforward reward card that gives
them cash back on everyday purchases," said Sean Amato-Gauci,
vice-president, RBC Credit Cards.
RBC's payment survey conducted by Ipsos Reid, found that
more than half (58 per cent) of Canadians hold a credit card
with some type of reward program. Nine-in-ten credit cardholders
(88 per cent) say they pay for travel using their card and
more than half (53 per cent) use it to pay for retail purchases.
Fifty per cent indicate they use their credit card for dining,
entertainment or gas purchases, while a third (34 per cent)
use it to pay for drug store purchases.
The survey also found Canadian families spend on average
$628 at the grocery store each month. The majority (53 per
cent) use their debit card at the cash register, with the
others split between using cash (21 per cent) and credit cards
(26 per cent) to pay for groceries.
"Many cash back cards have complicated earn rates or
thresholds that Canadians find confusing and misleading,"
noted Amato-Gauci. "Our clients have told us they want
a simple and straight forward cash back card, with no tiers
to calculate, no clubs to join, or points to track."
The RBC Cash Back card offers the following features:
- One per cent cash back on all purchases
- Five per cent cash back on grocery store purchases until
December 31, 2010
- Purchase Security and Extended Warranty insurances
- Zero Liability fraud protection
The RBC Cash Back card tracks rewards on the cardholder's
monthly credit card statement and pays out the cash back in
January each year. A cardholder who spends about $500 a month
on groceries, and $500 on other monthly purchases using their
RBC Cash Back card for the remainder of this year would earn
over $200 by next January.
"The cash back you receive can add up quickly based
on the day-to-day spending habits of an average Canadian family,"
To find out more about calculating annual cash back earned,
consumers can visit http://www.rbcroyalbank.com/cashbackcard/calculator
to try the RBC Cash Back calculator.
Amato-Gauci provides the following tips for optimizing your
credit card rewards:
Don't spend more, spend smart - If you never carry
a balance and always pay your bills on time, you can actually
make your card work for you by using it frequently for all
kinds of purchases and expenses. Many people rely on their
credit cards for larger purchases but may not use it for everyday
shopping instead of using cash. Groceries, gas, restaurant
and clothing purchases add up quickly and may earn rewards
at a higher rate than some other categories of spending. You
can also use your card to pay monthly expenses such as utilities
(hydro, cable, mobile phones) daycare, tuition, gym memberships
and newspaper subscriptions, to bump up your rewards.
Put your monthly payment on autopilot - Choose a card
that allows you to set up a monthly payment that automatically
pays off your entire balance or the minimum payment. By using
your credit card for everyday purchases and paying it off
at the end of the month, you will earn cash back but not pay
Consider insurance benefits - A card feature that
is often overlooked is purchase protection which insures against
loss, theft or damage up to 90 days after purchase. Another
valuable feature is an extension of the manufacturers' warranty
period which can provide additional protection for larger
ticket items such as home electronics or appliances.
Double dip if possible - Certain retailers let you
earn points for purchases in their own reward program or in
other independent programs. If you are a member of these programs,
you can present your program card to the retailer to earn
the applicable points, while at the same time earning cash
back rewards by using your credit card to pay for the purchase.
Look for rewards that offer convenience - With some
reward programs, points expire so you need to remember to
use the points or call the card issuer to request your rebate.
Others send your rebate to you when you hit a certain threshold
or credit your account automatically at the beginning of each
year. Either way, it makes sense to use a card that gives
rewards without any prompting from you.
The survey findings are from an RBC omnibus conducted by
Ipsos Reid between May 14 and May 17, 2010. The results of
the online survey are based on a sample where quota sampling
and weighting are employed to balance demographics and ensure
that the sample's composition reflects that of the actual
Canadian population according to Census data. A survey with
an unweighted probability sample of this size and a 100 per
cent response rate would have an estimated margin of error
of ±3.1 percentage points, 19 times out of 20, of what
the results would have been had the entire population of adults
in Canada been polled.
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For more information, please contact:
Media Relations, 416 974-2124
Jacqui van der Jagt,
Corporate Communications, 416 974-1756