Review of Discover Gas Card



The Discover Gas Card was last reviewed on : 7th March 2005

Summary - The Discover Platinum Gas Card has a tiered rebate formula based on annual expenditure. The rebate percentage actually declines as your annual expenditure goes up. Here is how it works. For your first $1,500 in annual expenditure, you earn 5% rebate on gasoline purchases and 1% on other purchases. For the next $1,500 in annual expenditure, you earn 3% (gas) and 0.5% (other purchases) rebate respectively. Once your annual expenditure exceeds $3,000, you earn only 1% (gas) and 0.25% (other purchases). You also only earn 0.25% on discount warehouse and stores. You can rebates for up to $25,000 in gasoline purchases. There is no limit on how much rebates you can earn for non-gasoline purchases. Rebates do not expire and can be redeemed once you earn $20.00. Discover allows you to double your rebate percentage if you exchange your cash rebate for gift certificates of selected merchandise. (For example, if you have earned $20.00 in rebate, you cash exchange it for a $40.00 gift certificate).

The Discover Gas Card has no annual fee. The APR ranges from Prime Rate plus 4.24% to 11.24%. You get a 0% APR offer for 8 months for balance transfers. Though Discover cards allow a 25 day grace period, they use the two-cycle average daily balance method for calculating balances.

To sum up, the Discover Gas Card gives a good 5% rebate for gasoline purchases for the first $1,500 gasoline purchases. If you have the discipline to exchange your cash rebates for Discover's gift certificate, then your actual rebate will work out to 10%. However, because the rebate percentage actually declines as your expenditure increases (especially for non-gas purchases), we recommend this card only for gas purchases and to use other credit cards for your other non-gasoline purchases. If you spend within $1,500 a month on gasoline, then this will make a good gas credit card. Another strong point is that unlike most other gas credit cards, Discover rebates do not expire.

Positives
  • No annual fee
  • Low apr if you qualify
  • Can double rebate percentages through gift certificates
  • Rebates do not expire


Negatives
  • Declining rebate formula
  • Uses the two-cycle average daily balance method for calculating balances


Discover Gas Card
Reward Benefits
Rebate Formula Tiered rebate formula
For first $1,500 in annual spending, earn 5% on gasoline purchases and 1% on other purchases
For next $1,500 in annual spending, earn 3% (gas) and 0.50% (other purchases)
Once annual spending exceeds $3,000, earn 1% (gas) and 0.25% (other purchases)
Earn 0.25% at discount warehouse and outlets
Redeem rebates at $20.00 increments
Rebate Expiration No expiration
Rebate Limits You can earn up to $1,250 in gasoline purchase rebates annually (ie $25,000 in gasoline spending)
No limits on other purchases
Credit Limit Up to $50,000
Travel and Insurance Benefits
$500,000 in travel insurance
$25,000 in auto rental insurance
Other Benefits
Cost/Fees/Interest rates
Introductory rate 0% introductory APR on balance transfers for 6 months
Annual Fees No annual fee
Purchase APR Prime Rate plus 4.24% to 11.24%
Balance Transfer APR Prime Rate plus 4.24% to 11.24%
Cash Advance APR 20.99% or 22.99%
Penalty/Default Rate APR Prime Rate plus 10.99%, 15.99% or 19.99%
Min Finance Charge $0.50
Grace Period 25 days
Balance Calculation Method 2-cycle Average Daily Balance (including new purchases)
Cash Advance Fee 3% min $5.00
Balance Transfer Fee 3% min $5.00, max $50.00
Over-the-credit-limit fee $15.00 - $1000 or less
$35.00 - greater than $1000
Late Payment fee $15.00 - up to $100
$25.00 - $100-$1000
$39.00 - greater than $1000



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