Bank of America Efectiva Visa Review

Issued in 2005 - Historical Background - The Bank of America Efectivaâ„¢ Platinum Plus® Visa® was issued in 2005 (17 March 2005 to be precise)¹. And it was a card specifically targeted at the Hispanic Community. It became one of the first bank to offer bilingual services and marketing materials. Bank of America's rationale was that there were more in the Hispanic Community who had no established credit history and this was one card that they wanted to reach out to them. Unlike their secured credit card (which only requires TIN and not SSN), this card gives a standard 1% cash rebate.

Incentives - As an incentive to sign up, you can earn earn 5 points for every $2,500 in net monthly balance transfers from non-Bank of America accounts. I find it amusing that they even dangled this out to prospects because my impression from their press release is that the Hispanic community had less establish credit. If that were so, I guess very few people would take them up on this offer.

More Details About The Rebate Formula - The Efectivaâ„¢ Platinum Plus® Visa has a simple rebate formula that pays you an equivalent of 1% cash rebates. You earn one point for every one hundred you spend and that one point will get you $1.00 in cash rebates. You can redeem your cash rebates when you have accumulated 25 points ($25.00). You can either choose to have the rebates sent to you via a check or deposited into your Bank of America savings or checking account. You can earn up to $600 in annual rebates.

For your first purchase, you earn 5 bonus points ($5.00 cash rebates). Hence, new cardholders will be well served to put a huge purchase on it to get the most bank for the buck.

Annual Fee and APR - This card has no annual fee. You get a 0% apr for both purchases and balance transfers for six billing cycles. The APR is prime rate plus 5.99%.

This Card Never Stood A Chance Vs The Best Cards - While this card may have had it's share of sign ups, what they were offering in terms of rebates were pretty average. During that era, the best cash back card was the Citi Dividend Platinum Select Card. Back then, that card paid 5% cash back on supermarket, gasoline and drugstore spending and 1% on everything else.

Another card that they were competing against was the old Blue Cash from American Express. As a refresher, after spending $6,500 on an annual basis, you earned 5% rebates on supermarket, gas and drugstore purchases. So even against a tiered cash back card like Blue Cash, the Effectiva does not look so impressive.

But over time, in 2006 and 2007, there was even greater competition. The Chase Cash Plus, followed by Chase Freedom was introduced then with the exact same formula as Citi Dividend!

Did I recommend this card back then? - The answer is NO. Earning 1% rebates is obviously better than nothing. But back then, the Citi Dividend, Chase Cash Plus and Amex Blue Cash were the best cash back cards and there really was no reason to recommend a card that paid only 1%. Having said that, BOA probably had some modest success with the card (just guessing) since they were targeting a specific market and probably had their brochures at relevant places where the Hispanic Community hung out whereas Chase and American Express was probably not doing that.

After the 2008 financial crisis, Bank of America has consolidated their credit card portfolio and this card is now longer available though existing holders still has a webpage to go to (see screen shot below) .