This card is the "rewards" version of their Visa Platinum Card. That particular card has arguably the lowest ongoing APR at 7.25%. But that card came with no rewards. Any body who works in the industry will tell you that if you offer a card with very low rates, then it is difficult to offer a rewards program because they are costly to run. It is for this reason that most rewards cards have their interest rates at about 13% or more.
Simmons First actually went better than most rewards cards. Instead of jacking up their interest rates to the mid teens, they just increased it slightly to 9.25%. This is still way less than most other cards with rewards. But given that the cards still offers a very low rate, will that compromise the reward program. I was very curious about that too and made sure I did the research thoroughly.
All About The Reward Program - Firstly let's start off by how you earn points. Well, for every dollar that you spend on the card, you will earn one point. This is pretty much standard in the industry although some cards will give you double points for certain spending categories. The real question is what are the reward points worth? If you look at the Simmons First website, they say that you can redeem airline tickets with any airlines and with no blackout dates. But do you have to use their travel portal? Do you have to book through their own agent? Well, the answer is that it turns out to be NO. You can book with any agent that you want.
What I did find surprising was that you can get more bang for the buck if you use reward points for airline tickets. And the reason is because unlike most reward program (where 100 points gets you $1 in value), a fix set of points gets you price range of tickets you could choose. It is best to look at the table below to understand what I'm saying.
The airline reward system is a throwback to the good old days where a fixed set of points gets you from a certain region to another. In it's present version, a fixed set of points gets you airline tickets within a certain price range. For example, you need 25,000 points for an airline ticket that cost up to $400. For most reward program (including Chase, Citi and Capital One), 25,000 points gets you $250 in value. So in my opinion, this program gets you more in value for a fixed set of points. If you look at the charts, the scale goes all the way to 600,000 points getting you up to $12,000 in ticket value (that is more like a full fare long haul first class ticket). If you fly long haul first class (or rather would like to redeem points this way), then earning frequent flyer miles would be the more efficient way to go about it. But for less expensive tickets, this reward program offers great value.
Another interesting aspect of the program caught my eye. And that was the cruise rewards. I found out that you can also get discounts on cruises using points. Below is the screenshots showing the cruise rewards.
One of the things that I noticed was that you do have to book the cruise with First Simmons and I would not know at this moment how competitive their rates are.
It is also worth noting that the reward program also have merchandises and gift cards (which is pretty standard). But once again, the highlight is the airline rewards.
This will be an interesting section because there are a couple of really unique features in this card. Firstly, in terms of ongoing APR and interest, nobody beats this card. At a 9.25% interest, it is low by a few percentage points compared to the typical rewards card.
Another area in which it beats out other cards is in the airline redemption charts. All the major programs like Chase Ultimate Rewards, Citi ThankYou, Capital One Rewards, Amex Membership Rewards have a 1% redemption rate for their airline tickets and travel. That means that 100 points gets you $1 in value. But as you can see from the chart above, once you get to 25,000 points, you can redeem it for tickets slightly above the 1% threshold. In fact, in this sense, it beats most other programs and cards. If we compare no annual fee reward cards like the Chase Sapphire, Cap One Venture, Citi ThankYou, this card actually beats them all in the airline redemption area. The ones which are better all charge annual fees. Examples of such cards include the Cap One Venture (the one that allows you to earn double points) and the Barclays Arrival (with the annual fee and is also a double points card). But despite it allowing you to earn double points, the redemption rate for airline tickets is still 1%.
Is This A Good Card?
If you surf around the web and read other blogs, especially frequent flyer blog, you will find that many talk about cards like Chase Sapphire Preferred, Capital One Venture and perhaps Citi ThankYou Preferred. Nobody has ever recommended this card as a favorite. And I think it is a shame because it has some really good features. The airline rewards is better most no annual fee rewards card. Given that frequent flyer miles are becoming harder to redeem, using a reward program from a card issuer might suit some better. And for those of you who occasionally carry a balance, you simply cannot beat the interest rate.