Monday, January 30, 2023

How Capital One Credit Card Works

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The Consumer Just Starting Out

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If you have thin or fair credit, Capital One offers multiple cards to choose from. The Capital One Platinum is a good choice for the consumer with fair credit, while the Capital One Secured accepts consumers who have no credit history. Also, the Journey Student Rewards card is a great starter option, and all come without an annual fee.

Capital Ones 2019 Data Breach

In July 2019, Capital One hit a bit of a speedbump.

A hacker managed to access a variety of personal information, ranging from Social Security numbers and linked bank account numbers to names and addresses, belonging to millions of Capital One customers in both the U.S. and Canada.

The good news? The suspect has since been apprehended, and Capital Ones rundown of the incident suggests that none of the information accessed seems to have been disseminated.

Nevertheless, the situation is an important reminder that even the modern security technology employed by global businesses has its weaknesses. If you think you may have been impacted by this breach, or any other data breach, make sure you understand how to deal with identity theft, and monitor your credit reports to keep an eye out for fraudulent activity.

Capital One has stated that it will notify customers that may have been impacted via traditional mail. Free credit monitoring and identity protection services are being offered to those affected.

Looking for cards from other major issuers? Check out the best credit cards in a variety of categories and from many different issuers.

How To Redeem Capital One Cash Back

Redeeming your Capital One cash back is simple:

  • Log in to your Capital One account.
  • From your dashboard, navigate to the Rewards section.
  • Now, you can choose what you want to redeem your cash back for.

    Capital One cash back redemption options

    • Cash.You can receive a mailed check or statement credit. Also, you can apply your cash back to specific purchases youve already made.
    • Gift cards.These are available from dozens of retailers, online stores, restaurants and more. Redemptions start as low as $10, but many gift cards require a $25 minimum.
    • Transfer.You can transfer your cash back to one of your other Capital One accounts. If youd like to transfer rewards to someone elses Capital One account, call the number on the back of your card and ask to speak with a representative.

    How much is Capital One cash back worth?

    Capital One cash back is worth face value, whether you redeem it for a check or statement credit or to offset a purchase. If you have $50 in cash back, for example, its worth $50 in statement credit.

    The same goes if you redeem your cash back for gift cards. A $50 gift card will cost $50 in cash back.

    Pro tip

    While gift cards deliver decent value for your cash back, you can buy them in a more lucrative way.

    Instead, you could use your card to buy the gift card at a Starbucks store. Youll earn 4% cash back on that transaction, which is equivalent to $4 in rewards.

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    Best For Students: Journey Student Rewards From Capital One

    Rewards Earning Rate Earn 1% Cash Back on all purchases. 0.25% Cash Back bonus on the cash back you earn each month you pay on time. Earn $5 per month for 12 months on Select Streaming Subscriptions when you pay on time. *Exclusions Apply
    Balance Transfer Fee There is no standard balance transfer fee for this card.
    Foreign transaction fee
    • Why We Chose This Card
    • Pros & Cons

    The Journey Student Rewards from Capital One is our pick for the best student card as it provides students with cash back on every purchase dollar. Plus, it includes an incentive to build solid money habits by offering a 25% boost in earnings each month for on-time payments. Journey Student Rewards also offers solid credit education, account management, and security tools for college students starting out with credit.

    • Offers cash back, unusual for a student card

    • Streaming subscription credits when paid on time

    Read the full Journey Student Rewards from Capital One credit card review

    Capital One Spark Cash Plus

    Best for small businesses

    • This card is best for: Small business owners looking to earn high cash back rewards without keeping track of spending categories.
    • This card is not a great choice for: People who may not have the cash flow in their business to cover the annual fee.
    • What makes this card unique? Small business owners can earn unlimited 2 percent cash back on all purchases, making it a bit easier to earn consistent rewards on business expenses. Theres also the opportunity to earn cash bonuses with certain terms and conditions.
    • Is the Capital One Spark Cash Plus worth it? For small businesses with the cash flow to handle an $150 annual fee, the Capital One Spark Cash Plus is a great way to earn consistent and high cash back rewards on purchases. If youre looking to earn some of the cash bonuses but youre worried about the spending requirements, there may be other cards on the market that offer a different set of rewards that better fit your needs.

    Jump back to offer details.

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    Capital One Spark Miles For Business

    Best for business travel rewards

    • This card is best for: Small business owners on the hunt for travel rewards that also like the appeal of other flat-rate Capital One rewards cards.
    • This card is not a great choice for: Those who want a host of premium travel perks.
    • What makes this card unique? Business owners and their employees will collect unlimited 2X miles spent on all purchases. By spending $4,500 in combined purchases within your first three months, you can earn 50,000 miles, which can be boosted higher by finding a great deal through a Capital One transfer partner.
    • Is the Capital One Spark Miles for Business worth it? The opportunity to earn unlimited 2X miles on all purchases could be huge for small business owners with expenses that surpass or fall outside the scope of traditional bonus categories. Although this cards $95 annual fee is $0 intro in the first year, there are competing cards that offer higher rewards rates and more features to justify such a fee.

    Jump back to offer details.

    Increase Capital One Platinum Secured Credit Limit Options:

  • Over-deposit before getting your card

    If you get approved, Capital One will require you to place a security deposit of $49, $99 or $200 to actually open your account. The deposit amount youre assigned depends on your overall credit standing, but everyone starts with a $200 credit limit unless you deposit more than is required, that is. Any amount you deposit above whats required will boost your spending limit by the same amount. For example, if youre required to place a $49 deposit and you put down $149, your credit limit will be $300 instead of $200.

  • Pay on time for 6+ months

    After account opening, the only way to get a Capital One Platinum Secured credit limit increase is to pay on time for 6 months. If you do, Capital One will likely raise your credit limit during the 7th month. By how much, though, is completely up to them. If you pay on time but other aspects of your credit get worse, you might not get an increase.

    Its also possible that Capital One will eventually return your deposit and transition you to an unsecured credit card with a higher credit limit. But that depends on how financially responsible you are.

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    Capital One Venture Rewards Credit Card Vs Chase Sapphire Preferred Card

    The Capital One Venture and the Chase Sapphire Preferred® Card card are competitive with their similar welcome offers, miles/points transfer options and additional benefits, but a close look at the details paint a clear difference in priority between these two travel cards.

    While the Venture card earns unlimited 2 Venture miles per dollar spent, Sapphire Preferred cardholders will earn 5 points per dollar on travel purchased through Chase Ultimate Rewards®, 3 points per dollar on dining and 2 points per dollar on all other travel purchases and one point per dollar on all other eligible purchases. Plus, through March 2022 you’ll earn a total of 5 points per dollar on Lyft rides. However, not all miles are created equalUltimate Rewards can be redeemed for 1.25 cents each through Chase Travel compared to Venture Miles 1 cent each value. That said, Capital Ones Venture Miles can be redeemed against eligible travel purchases from any source.

    Otherwise, the cards are quite similar with equal annual fees, no foreign transaction fees, 24/7 support and travel coverage.

    Capital One Ventureone Rewards For Good Credit: Best Travel Rewards With No Annual Fee

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    Why we picked it: This flat rate travel card lets you earn unlimited miles on every purchase at a rate of 1.25X. Theres no annual fee and no bonus categories to keep track of.

    Pros: Redemption is relatively easy with no minimum required, no blackout dates and no expiration dates. Plus, theres no cap on miles earned.

    Cons: The list of airline partners doesnt include any of the big three legacy carriers which may be a deal breaker for some airline loyalists.

    Who should apply? Frequent travelers searching for a decent rewards rate on a no annual fee card will find a lot of potential value in this card.

    Who should skip? If your local airports dont typically fly United, American, or Delta, a different travel card would make more sense.

    Read our Capital One VentureOne Rewards for Good Credit details.

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    Journey Student Rewards From Capital One

    Best for responsible students

    • This card is best for: Responsible students who will always pay their bill on time.
    • This card is not a great choice for: Students looking to earn substantial cash back rewards.
    • What makes this card unique? The unlimited cash back rate on this card starts at 1 percent and students who use this card responsibly can earn a cash back increase to 1.25 percent for that month after paying each billing cycle on time. Theres also a fairly nice welcome offer for students who enjoy streaming services where you can earn up to $60 in streaming subscription credits for popular streaming services when you pay on time .
    • Is the Journey Student Rewards from Capital One worth it? There are certainly other student cash rewards cards that offer higher rewards rates. However, the Journey Student Rewards is a great starting point for earning an unlimited cash rewards rate with the possibility of increasing those rewards over time. Plus, you might learn some smart spending habits along the way.

    Jump back to offer details.

    Types Of Cash Back Cards

    Generally, there are three categories of cash back cards: flat rate, tiered and rotating. Your rewards will vary depending on the issuer and which card you have, but hereâs a quick overview:

    1. Flat-Rate Cash Back Cards

    The Capital One Quicksilver and QuicksilverOne cards are two examples of flat-rate cash back cards. They both offer unlimited 1.5% cash back on every purchase, every day. With flat-rate cash back cards, you earn the same percentage rate on every purchase you make with your credit card. So whether youâre buying gas, groceries or anything else, youâll earn the same percentage of cash back every time.

    2. Tiered-Category Cash Back Cards

    Tiered-category cards let you earn different levels of cash back on different spending categories. For example, the Capital One Savor card offers 4% cash back on dining, entertainment, popular streaming services, 3% at grocery stores1 and 1% on all other purchases.

    SavorOne has similar rewards: 3% cash back on dining, entertainment, popular streaming services and grocery stores, and 1% on all other purchases. There are also other differences between Savor and SavorOne you may want to check out before you apply.

    Credit card issuers know which purchases qualify for cash back rewards thanks to a four-digit number called a merchant category code. These codes are assigned to each credit card transaction. They help tell issuers which purchases qualify for different levels of cash back rewards.

    3. Rotating-Category Cash Back Cards

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    How To Use Rewards From The Capital One Spark Cash Plus Card

    There are two options for redeeming the rewards from your Spark 2% Cash Plus: You can choose to take them as cash back, which can be a great way to boost your business’s bottom line. If you go this route you can redeem your rewards for a check or statement credit, with no minimum amount required for redemption.

    Read more: How to earn, redeem, and maximize Capital One miles

    However, if you also have a Capital One card that earns miles, such as the Capital One Venture Rewards Credit Card or Capital One Spark Miles for Business card, you can choose to convert your rewards into airline miles as well. Simply log in to the Capital One website and use the “move rewards” feature to move cash back from your Spark 2% Cash Plus to either the Venture or Spark Miles. From there, you can transfer to over a dozen airline and hotel partners at a ratio of either 1:1 or 2:1.5 depending on the specific partner.

    Virtual Cards And Long

    Capital One

    If you are subscribing for something and you are sure that it will be a long-term service, paying with your VCC may not be a good idea. You should pay close attention to expiration dates because the service will be terminated if your Capital One VCC expires, and the provider uses that data to renew your subscription.

    For a better overview of the pros and cons of a Capital One VCC, check the table below.

    What is good about a Capital One virtual card?

    What is not so good about a Capital One virtual card?
    Data protection

    Relatively short expiration dates

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    Save Time And Money With Capital One Shopping A Free Tool That Instantly Checks For Coupons Better Prices And Rewards

    Saving money while shopping online is always better when itâs easy. And thanks to Capital One Shopping, the better deal is even easier to find.

    Capital One Shopping does the work that often makes finding a deal a challenge. Like instantly searching for and testing coupon codes or searching retailers for better prices. Plus, itâs 100% freeâand you donât need to be a Capital One customer to use it. So you can spend your time living, not hunting for bargains. Itâs kinda genius.

    Capital One Platinum Card Review: Who Is It For

    Advertiser Disclosure

    Advertiser Disclosure: ValuePenguin is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on our site . To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

    Editorial Note: The content of this article is based on the authors opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

    Citi is an advertising partner

    If you have a spotty credit history or no credit history, the Capital One Platinum Credit Card is worth considering. This card offers the potential to build good credit without paying an annual fee.

    With an over-the-top APR of 26.99% , the Capital One Platinum Credit Card may seem unattractive for many consumers. However, for those with mediocre credit or starting to build their credit history, the Capital One Platinum Credit Card may be the place to start.


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    What Do Capital One Credit Cards Offer

    Capital One offers a card designed to boost your credit score over time and a 0% balance transfer card, which could help you to save money on existing credit card debt. Credit is subject to status and terms apply.

    Capital One Quicksilver Cash Rewards Credit Card: Best For Cash Back

    Capital One Secured Credit Card – Secured Card Review

    Why we picked it: The Capital One Quicksilver Cash Rewards Credit Card is great for people who want the freedom of cash back without having to worry about rotating categories. It offers unlimited 1.5 percent back on all purchases. Plus, theres a sign-up bonus that lets new cardholders earn $200 after spending $500 in their first three months.

    Pros: Unlike the QuicksilverOne, which accepts people with lower credit, the Quicksilver has no annual fee. This card is a prime choice when youre looking for a no-annual-fee credit card that has across-the-board boosted ongoing rewards.

    Cons: If you are willing to pay an annual fee, you can get a better welcome bonus and better tiered ongoing rewards, as with the Blue Cash Preferred® Card from American Express . Learn more about the best cash back credit cards.

    Who should apply? Anyone put off by complicated rewards programs and rotating categories is likely to appreciate the simplicity of this flat-rate cash back card. This card is also ideal for frequent travelers thanks to its lack of foreign transaction fees.

    Who should skip? A strategic rewards-minded cardholder who wants to earn bonus rates in certain categories or follow a rotating cash back schedule.

    Read our Capital One Quicksilver Cash Rewards Credit Card review.

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