Thread: Kroger Credit Card - Read This Before You Apply!

WARNING: The 2013 Kroger credit card is not what it seems. They may be a great grocery store but here’s what isn’t so great about the Kroger Mastercard.

Wherever you live, odds are there are Kroger-owned supermarkets in your area. In the Midwest they go by then name Kroger’s, in California it’s Ralph’s, and there are other regional names they operate under too. Combined, they are the largest grocery store chain in America. So you would think it would make sense to get their credit card, right? Not exactly. This Kroger credit card review will show you why…

The signup offer is a joke...
Obviously their card promotions can change at any time but over the last couple years, from my personal experience, here's what I've seen them offer:

$25 new account bonus? Frequently I see them run a promotion to get a $25 credit at their store when you apply and are approved for their store card (previously known as the 1-2-3 Rewards MasterCard but sometime around 2012 it changed to a Visa). I don’t know about you, but that in itself is hardly enough of an incentive. I remind me of those pitiful bonuses you see banks give out to signup for a checking account. $25 may be nice, but the honest truth that you can get a bonus of $100 to $250 with cards like these instead.

–OR–

25 cents a gallon fuel rebate? An alternate Kroger card offer I've seen is to get an additional 25 cent/gallon fuel discount when filling up at Kroger gas stations. Is this worth it? Well first look at the fine print...



So keep in mind that part that says "when you redeem at least 100 existing fuel points earned in a single month." Then of course the question is... how much will that really save you over a period of only 3 months?

Let's say you buy 12 gallons of gas per week. Over a period of 13 weeks (appx. 3 months) you will have purchased 156 gallons. With the credit card promotion for 25 cents off that equals a grand total of only $39. Obviously saving money is good. But again I bring up the point... would $39 be worth it, when you can get a different credit card that has a bonus of several times higher?

The APRs aren't exactly a bargain either...
Plain and simple, this is not a good choice if you need to transfer a balance.

At the time of this review, the Kroger 123 Visa application listed the 0% promo as being only 9 months for balance transfers and purchases. This is definitely on the low side - the average card out is giving new accounts 0% for 12-15 months (or longer). After Kroger's 0% offer ends, the APR isn’t the worst I’ve seen but it’s not the best either. There are different tiers which depend on your credit score/history. At the time of this review the highest tier listed on the application was 23.99%.

The Kroger credit card rewards program is sneaky...
They call their rewards program 1-2-3 Rewards points. For each dollar spent, here’s what they offer…

• 1 point on normal purchases
• 2 points at Kroger (and Kroger-owned) grocery stores. This excludes gas and alcohol.
• 3 points on Kroger-brand products

Now read the fine print…
When you read about the above point structure, you might conclude it's giving you 1% on normal purchases, 2% at Kroger, and 3% on their brands… right? WRONG!

They give you a $5 grocery coupon for every 1,000 points you spend. That only equals out to be…

• 0.5% rebate on normal purchases
• 1% rebate at Kroger (excluding their fuel centers)
• 1.5% rebate on Kroger brands

That’s pretty lousy, huh? Getting only a half-percent cash back on your regular purchases is pathetic. Most credit card offers give at least double that (1%). So the Kroger Visa offers no real value as far as rewards.

Your best bet for 2013 = 6% cash back at supermarkets
You can do a lot better than the Kroger 123 Rewards Visa card. American Express recently launched 2 cards:

• Blue Cash Everyday = no annual fee and the first $6,000 of purchases at U.S. stand-alone supermarkets in a calendar year qualifies for 3% cash back; 1% thereafter.
• Blue Cash Preferred = $75 annual fee and the first $6,000 of purchases at U.S. stand-alone supermarkets in a calendar year qualifies for 6% cash back; 1% thereafter.

Not to mention, these cards give high cash back on other purchases, too! I use a Blue Cash myself and recommend you check out CreditCardForum's current offers which are available for each:

Earn 3% or 6% cash back at US stand-alone supermarkets

All of the above information about Kroger's 123 card is correct. I have had the card for at least 6 years. Over the years the points system was changed from the equivalent of 1% 2% 3% to 0.5%, 1% 1.5%. This was done quietly without official notice given. The card was originally issued by RBS bank - which experienced difficult times and dumped it's card program with Kroger. Then Kroger switched to US bank.

I have done my homework on grocery rebates and feel confident that the American Express Cash Blue card for groceries is the way to go. 6% rebate - no annual fee the first year, then I think it is 75.00 per year after than. All of the supermarkets we ever visit take the AX card. Despite the annual fee, you come out way ahead of Discover and other grocery cards. we spend 1000.00 per month on groceries. I do not know how that compares to other families of 4. That is 720.00 per year. When you factor in the annual fee the net rebate percentage for us is 5.375% still not bad.

Credit Card Guru: there are a few places in your review that reference the MasterCard version that RBS introduced. They are all now Visa cards under US Bank as far as I know.

They keep sending me offers. No way Josephina!