BankAmerica Corp. has introduced a credit card that offers rewards toward basic banking services.
The card, BankAmericard Banking Benefits, lets customers accumulate points toward reduced checking account fees, closing costs on home loans, computer banking fees, and other items. The points can also be applied toward lower interest rates on revolving card balances.
The product has been under development for more than a year as part of a commemoration of the 40th birthday of the original BankAmericard, widely considered the first bank card.
It was mid-September 1958 when Bank of America mailed 60,000 cards to customers in Fresno, Calif. A year later the card became available statewide and was accepted by more than 20,000 merchants. The modern product will also be introduced gradually: It is now offered in California and will spread to other states by yearend.
"We want to make banking with BofA even more rewarding for our card customers, and our new BankAmericard Banking Benefits card does just that," said Stephen B. Galasso, president of Bank of America NA, the Phoenix-based credit card subsidiary.
The card has a six-month teaser rate of 5.9%, which then jumps to prime plus 8.99%, currently 17.49%. Cardholders are to earn one point for every $100 of new monthly purchases or two points when they carry a balance.
A customer who amasses 10 points can cash them in for $10 off monthly checking fees; 400 points earns a reduction of four percentage points on the BankAmericard interest rate.
Reward points do not expire, and can be redeemed by calling a toll-free number.
In other fanfare over BankAmericard's anniversary, the bank has set up a historical exhibit at its headquarters and posted it on the Internet. It is holding parties for longtime customers and employees at several branches.
Nostalgia within the bank is running deep. James G. Jones, Bank of America's group executive vice president and head of consumer loan administration, said the original card "revolutionized the purchasing power of millions of consumers worldwide and changed buying habits forever."
"Merchants no longer had to maintain credit departments," said Sharif Bayyari, president and chief executive officer of BA Merchant Services Inc. "Smaller merchants who had never had the resources to grant credit were able to offer credit to a whole new group of customers."