Every once in a while you will come across a card that’s a hidden gem… it has some good benefits but since it’s issued by a local or regional bank, not many people know about it. A case in point are the Plains Commerce Bank credit cards.
Plains Commerce Bank has 6 branches in South Dakota. So when it comes to banks, they are about as small as you can get. So what makes their credit cards unique?
Reason #1: They’re issued and managed in-house
You may be surprised to learn that most small and regional banks (even the bigger ones like KeyBank) outsource their credit card portfolios to the big boys like Citi, FIA Card Services (BofA), etc.
I figured that would be the case, but after examining the Commerce Bank Visa card application, it’s quite obvious they are managed in-house! Heck, you even apply for their credit card the old fashioned way by mailing your application to a branch.
Reason #2: The interest rate is low
All of their cards have the same rate… a flat 12% fixed. Even on cash advances!
Obviously many of the big banks offer APRs that may start at 10.99% or 11.99% but you need the best credit to get that rate. Contrast that to Plains Commerce, who is giving everyone that is approved the same low rate.
Reason #3: They use fixed interest rates, NOT variable
Over the past 5 years or so, fixed rate credit cards have virtually gone extinct. Almost every card that previously offered fixed has been converted to variable, which means it’s tied to the U.S. prime rate. So when that goes up, your rate will go up.
On the other hand, Plains Commerce Bank has stuck with fixed rate on their credit cards.
Old fashioned is good for some but not all
While reviewing the applications I actually reminisce to my childhood. Why? Because the names of the cards are a blast from the past.
Their top tier offer is the Plains Commerce Bank Visa Gold card and next down on the list is the Visa and MasterCard Classic. Except for AmEx Gold, when was the last time you’ve seen a gold tier credit card? I got a chuckle out of that. By the way they used to offer a secured credit card but I don’t see it listed, so apparently that’s no more.
Another aspect that’s old school is that there is no rewards program on these cards. Normally I would criticize that, but given the low fixed interest rates I will let it slide this time.
The credit cards from Plains Commerce Bank is what used to be offered… locally issued and managed cards. For the person who carries the occasional balance, the benefits of a lower rate probably outweigh the lack of rewards.
Meanwhile for those who carry pay their bills in full, they would be better off with the high cash back offered on the AmEx Blue Cash (no annual fee) or any number of other reward cards out there.
Last but not least, since you have to have an existing banking relationship with Plains Commerce to apply for their credit card, so unfortunately it’s mainly for those in South Dakota only.
Updated for 2013