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Co-branded credit cards are popular these days because they combine the convenience of international credit capabilities with the exclusive benefits of specialty retailers. This new Shoppers Optimum MasterCard, for example, unites RBC's credibility with the convenience of Shoppers Drug Mart.
Frugal consumers in Canada already recognize Shoppers Drug Mart as an ideal place to handle their prescription and over-the-counter medical needs. Now these same customers can take advantage of exclusive Shoppers Drug Mart benefits with the convenience of a Royal Bank of Canada credit card co-branded with the Shoppers Drug Mart's Optimum Rewards Program. In order to fully understand these combined benefits, though, you will need to first look at each of the components separately.
Shoppers Optimum Loyalty Program
The Shoppers Optimum Loyalty program is a frequent shopper rewards program for which you can sign up without applying for this specific credit card. This program earns you 10 points on the $1 charged, points that you can redeem towards a variety of benefits later. This, of course, is similar to other programs that let you earn rewards points, though the rate by which you can earn these points will seem greater. Another difference, though, lies within the progressive rewards structure, which means that your points are worth more when you have already banked points in the past. For example:
- 8,000 points could be worth a $10 cash credit redemption
- 22,000 points could be worth a $30 cash rebate
- 95,000 points could be worth $170
While the earnings rate on redemption point value may seem to be generous it is important to note that there is a substantial gap between the redemption values. For instance if you earn 15,000 points you can either redeem it for one $10 credit or you can bank the points until you get to the 22,000 mark. Unfortunately, many people are not able to actually reach the 22,000 point level within a reasonable amount of time.
The Credit Card Program
Now that you have examined the rewards program, above, you can begin comparing how the basic program compares to the one associated with the credit card. There are a couple bonuses available to you when you are both a Shoppers Drug Mart's Rewards loyalty program member and an RBC Shoppers Optimum MasterCard holder:
- 15,000 bonus points (an actual equivalent of about $20, but could be worth more obviously, when added to an existing rewards point balance)
- Get a 15 point bonus on the dollar (for a total of 25 points for every $1 charged to your card; opposed to 10 points when you are just a loyalty club member
- The basic return rate on loyalty points is, generally, much higher: 3.4% for loyalty club member cardholders vs 1.25% for loyalty club members without the RBC Shoppers Optimum MasterCard
- Optimum MasterCard holders can earn up to a 4.5% after $3,800 in eligible spending
Compared With Other Programs
As you might imagine, the Shoppers program is not the only drug store program available in Canada. The Rexall PharmaPlus Air Miles program offers 1.1% in Air Miles Cash on purchases with participating retailers. You can combine the PharmaPlus loyalty plan with a No-Fee American Express Air Miles Credit Card for an additional 0.7% in cash back.
Perhaps the most important fact you will need to know when considering this card and this program, however, is that prescription medications are not eligible for reward points in Ontario, British Columbia, Newfoundland, and Prince Edward Island.
At the end of the day, this new Shoppers Optimum MasterCard probably best serves new Shoppers loyalty program members who use more over-the-counter medications and appreciate the convenient locations. If, however, most of your health care budget goes towards prescription medications, this card will not be very rewarding.