General Motors currently has a co-branded credit card issued by Capital One. Both Goldman Sachs & Barclays are bidding for this co-branded card business which currently has $3 billion in outstanding balances. Goldman Sachs has recently been moving into consumer facing products with the launch of online bank Marcus & the Apple credit card. Both Goldman Sachs & Barclays are pushing the idea of cars as an e-commerce portal, citing the potential for car owners to use voice recognition to order things like coffee ahead of time.
The GM BuyPower card does currently have some limited use, for example some cardholders received an offer for $1,000 when they purchased or leased a new vehicle earlier this year. Capital One added some new features in September last year as well.
Hat tip to WSJ
For those that don’t know this takeover by Goldman Sachs is going to be complete in the 1Qtr 2022. They are moving to a points system which is bad news for customers like me. Straight forward $1 for $1 redemption is the best for the customer. Going to a point system just means your open to diminishing returns due to the bank controlling the redemption point conversion rate.
In addition to changing to a point system, they are changing the rewards rate. Before we were rewarded with 5% on the first $5,000 in purchases each year and then 2% after that. This put them in a league of their own since you could earn 5% on every purchase regardless of category. Coupling this card with other 5% cards I have been able to earn 5% on nearly everything I buy. That is now gone. It is dropped to 4%, while still decent it is reduction in the value to me.
Since I have a significant amount of rewards in this account, I won’t be closing it anytime soon. However I will be reducing the amount of purchases per year. We will see what other changes we have in store in the future.
Goldman won the rights.
I recently got an offer for an extra 5% back on rewards (so 7% total after the initial $5,000 in spending) at grocery stores up to $250 in rewards from 8/3/20-9/30/20. I know this isn’t a hugely popular card, but for those who can find ways to use the rewards, it’s pretty legit. They do promos like this pretty regularly, and so far funding bank accounts with it have been pretty lucrative.
Somebody in those HQs is completely out of touch with reality. A lot of people are not driving much, I am putting maybe a tenth of my usual mileage since February. And why would they think people will use only their CCs if they suddenly start ordering Puffy blankets from their cars ?
So they are basically bidding to take on a cool 3 bil. of outstanding balances that probably carry with them a decent risk of delinquencies. Mkay.
Please someone shake this thing up! I know someone with the biz version from years back and it is the most useless pos card. Rewards for biz version are valid on a new GM vehicle, a new GM vehicle or a new GM vehicle…
That’s so weird. Why wouldn’t Ally take over GM’s credit card portfolio given that GMAC is a division of General Motors?
GM hasn’t had a stake in Ally/GMAC in years.
GM only owns 49% of Ally Financial. GMAC is no longer the name. Even before the GM bankruptcy, the GM Card was serviced and funded by HSBC that later sold off their credit card portfolio to Capital One. Maybe it is a conflict of interest for them to issue the card or it just isn’t profitable enough as they would have to keep money in reserves to lend out. Ally for a while did offer a Visa credit card; however, it was ironically issued by TD Bank. TD Bank purchased Chrysler Financial to become TD Auto Finance-a direct competitor of Ally Financial.
The GM Card was huge in the ’90s…I am actually surprised people still carry it.
GM sold that minority stake off. I don’t believe GM has any ownership any longer.
It’s my wife’s oldest card, and has no annual fee. Otherwise, it would have been gone many years ago.
On top of what other people have said, Ally doesn’t even currently have a credit card division. That’s part of why they were going to purchase CardWorks pre-pandemic.