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If you’re looking for your first credit card or want to add another one to your wallet, don’t sleep on credit union credit cards. When you compare what credit unions have to offer versus big banks, you might find better options for your wallet and spending habits at a credit union. One of the ways credit unions pass their profits back to consumers is via lower interest rates on credit cards, which can benefit cardholders who tend to carry a balance.
In this roundup, we selected six credit union cards that met these requirements:
- Carry a solid intro APR offer and/or low ongoing APR
- Have easy-to-meet credit union membership requirements
- Carry a low or no annual fee
- Offer points per dollar spent and travel and protection perks
- Offer benefits and extra perks
|Best Credit Union Credit Cards|
|Best overall||PenFed Platinum Rewards Visa Signature® Card|
|Best for cash back||Alliant Cashback Visa® Signature Credit Card|
|Best for rotating categories||Visa® Platinum Rewards Credit Card from Nusenda Credit Union|
|Best for travel||Odyssey™ Rewards World Elite MasterCard®|
|Best for service members||USAA® Rewards™ American Express® Card|
|Best secured card||Savings Secured Visa Platinum Card|
Best overall: PenFed Platinum Rewards Visa Signature® Card
Why we like it
Thanks to its broad membership categories, the fact that it charges a $0 annual fee, and some pretty good perks and benefits, this card is worthy of your consideration. Most credit union credit cards don’t come with a sign-up bonus, which makes this card all the more noteworthy. It offers a $100 statement credit when you spend $1,500 in first 90 days.
There’s a low bar for entry with this card. Aside from being a member of the military or working for the federal government or being the family member or housemate of one, you can also join Voices for America’s Troops or the National Military Family Association for a one-time fee of $17.
High rewards rate on gas and groceries. It also offers the chance to earn higher points per dollar spent in popular categories, which you usually don’t get with credit union cards. You earn 5X points on gas at the pump, 3X points on groceries, 1X points on all other purchases. The points you earn for spending on gas and groceries are better than even some non-credit union cards. There’s no limit to the number of points you can earn on the card and you can use them for merchandise, gift cards, gift certificates, hotels, car rentals, airfare, vacation tours and vacation deals.
Low ongoing and promo APRs. The regular purchase APR is 11.49%to 17.99% variable, while the balance transfer APR is 11.49%to 17.99% variable. These APRs are lower than what banks offer for their credit cards.
No foreign transaction fee. This is a good card to use outside of the U.S. since its no foreign transaction fee.
Things to watch out for
- There’s no intro purchase APR. While the regular purchase 11.49%to 17.99% variable APR is better than what’s offered by the big banks, it’s a bit high when compared with other credit union cards.
- While the card does have a balance transfer intro rate of 0% for 12 months on transfers made between 8/1/2018 - 9/30/2018, it jumps to a higher 11.49%to 17.99% variable APR after.
- Excellent/Good credit is needed for it.
- If you use your points to go toward airfare, it will cost you $15 to book online or $25 by phone.
- The points you earn on this card expire five years from the end of the month in which they were earned.
This Visa Signature® card includes access to the Visa Signature® Luxury Hotel Collection, which comes with perks like VIP status, complimentary breakfast daily and room upgrades when available. You get access to special dining and wine events and complimentary tastings at Sonoma County wineries. And it comes with a Visa Signature® Concierge, travel accident insurance, travel and emergency assistance services, rental car insurance, roadside dispatch, discounts at retailers and online stores, extended warranty and purchase protection.
Best for cash back: Alliant Cashback Visa® Signature Credit Card
Why we like it
It keeps it simple. If you want a card that offers good points per dollar spent without having to worry about monitoring spending in different categories, this one is a great option. Just keep in mind if you want this card, you’ll need Excellent/Good credit to get it.
The rewards are unlimited. The biggest attraction of this card is its rewards — 2.5% cash back on all purchases (3% in the first year). This is excellent for a flat-rate card, especially in the first year. If you spend $42,000 in the first year on this card, you’ll earn $1,260 in cash back. And there’s no limit on the cash back you can earn, although you’ll earn lower rewards after that first year ends. Even so, the ongoing cashback rate is still on par with some of the best flat-rate cashback cards out there. Your cash back can either be redeemed as a statement credit or deposited to your Alliant checking or savings account.
The foreign transaction fee is $0, so spend away when traveling outside the country.
Things to watch out for
- This is one of the rare credit union cards that comes with an annual fee, at $99, waived the first year. But even with that fee kicking in year two, the fact that you can earn limitless cash back might make it well worth the upfront cost.
- There’s no cushy sign-up bonus.
- The card has a regular purchase 12.49% to 15.49% variable APR and a 12.49% to 15.49% variable balance transfer APR. These rates are better than bank-based cards but are still on the high side when compared with other credit union offerings.
- It charges a 3% balance transfer fee, which is more in line with what the big banks charge. If you want to use your cash back for things like travel, merchandise and gift cards, you can’t with this card.
Eligibility: This Chicago-based credit union, named 2018’s best in America by Money magazine, has pretty broad parameters across the country when it comes to membership. They include: employees, retirees and family members of organizations ranging from Allen Temple Baptist Church to the Sacramento Association of Realtors; relatives of existing members; if you live or work in 20 Illinois communities; or those who join Foster Care to Success for free.
Check out our roundup of best cashback credit cards.
Rotating categories: Visa® Platinum Rewards Credit Card from Nusenda Credit Union
Why we like it
Nice rewards. This card is for those who want to earn top rewards in a rotation of top categories like travel, gas and groceries. The fourth quarter for 2018 currently covers restaurants, hotels and airfare, which is ideal for holiday travel. Good credit is needed to get this card.
Good sign-up bonus. Here’s another card that actually comes with a sign-up bonus, where New card holders earn 10,000 bonus points for $500 in purchases during first 90 days. Cardmembers Earn 3 bonus points, or 5% cash back, respectively, for every dollar they spend on purchases for movies, restaurants, and home improvements (up to $1,500 per quarter).
Unusual rewards categories. Two of the rotating categories — home improvement and education expenses — are ones that don’t always pop up on credit cards when it comes to higher rewards. If you decide to do a balance transfer with this card, there’s no fee to do it.
No fuss rotating categories. Bonus categories rotate automatically every quarter, so you don’t have to worry about signing up each time. Spend the points you earn for things like travel or merchandise. And earn a bonus dividend on your average yearly loan under the Earn Your Return program if you have at least a $1,000 balance on your credit card.
Extra benefits: The card comes with car rental insurance, emergency assistance while traveling and an extended warranty.
Things to watch out for
- The purchase APR is 10.75% - 14.75% Variable, while the balance transfer APR is 10.75% - 14.75% Variable. These rates are higher than other credit union cards in this review, but still lower than what banks charge.
- The bonus points in the quarterly rotation categories can only be earned on the first $1,500 in spending. The points you earn for spending on favored categories like gas and groceries outside of the quarterly bonus are low. The card doesn’t come with many travel and protection perks.
Eligibility: You must be a member of the Nusenda Credit Union. If you’re not a resident of New Mexico or you don’t know a member who can recommend you, anyone can join the credit union by becoming a member of the La Montañita Food Co-op, which costs $15 per household. Good credit is needed to get this card.
Check out our roundup of current credit card bonus categories.
Travel: Odyssey™ Rewards World Elite MasterCard®
Why we like it
If you want a card that offers solid rewards for travel and dining spending, consider this one offered by the First Tech Federal Credit Union.
Cardmembers earn 3 rewards points for every $1 spent on travel, 2 rewards points for every $1 spent on dining, 1 reward point for every $1 spent on all other purchases. The points for travel are pretty high, even when compared with bank-based cards. Redeem your points at the card’s Rewards program website for things including gift cards, airfare, cruises, merchandise and more.
There is no foreign transaction fee when you make purchases outside the U.S. And there is no balance transfer fee.
The benefits: This card comes with the travel and purchase perks you’d expect with a World Elite Mastercard, including travel accident and baggage delay insurance; lost or damaged luggage insurance; trip cancellation insurance; MasterAssist Travel Assistance Services; rental car insurance; roadside assistance; purchase protection; extended warranty; and price protection. It also comes with access to a dedicated World Elite MasterCard Global concierge, special offers and upgrades at hotels, resorts and cruise lines worldwide, and premier access and preferred pricing food and wine, sporting and golf events.
Things to watch out for
- This is one of those rare credit union cards that comes with an annual fee — $75. If you spend regularly on things like gas or groceries, you’ll only earn the lowest points per dollar spent on this card.
- There’s no sign-up bonus or intro purchase APR.
- The intro balance transfer APR of 0% for 12 billing cycles is what you’d expect from most non-credit union credit cards.
- The card’s regular purchase rate, at 12.74% to 18.00% variable APR, puts it at the higher end for credit union credit cards, but is still lower than what’s offered by bank cards. The same goes for the regular balance transfer rate of 12.74% to 18.00% variable APR.
Eligibility: There are several ways to qualify. You work for a high tech or telecom sponsor company; work for the state of Oregon or live or work in Lane County, Ore.; you have an immediate family member who is a First Tech member; or, lastly, you can join the Computer History Museum (between $15 and $75 a year) or the Financial Fitness Association ($8 a year).
Check out our roundup of best travel credit cards.
Servicemembers: USAA® Rewards™ American Express® Card
Why we like it
Strong reputation. If you’re in the military, this card reels you in as soon as you see the letters U-S-A-A. The company is known for its legendary customer service for those in the military and their eligible families. The company also has special expertise dealing with the unique needs of service members that make its credit cards worth having. Excellent/Good credit is needed for this card.
The sign-up bonus allows members to Get 2,500 bonus points with your first purchase. While it’s smaller than what banks offer, at least it’s a credit union card that comes with a bonus. This card is attractive because of its rewards, especially if you spend regularly on dining, gas and groceries. Earn 3X points per dollar spent on dining, 2X points per dollar spent on gas and groceries, 1X point for every dollar spent on all other purchases.
Redeem your points at the USAA Rewards Service Center via usaa.com or by calling 800-980-8722. Use them for airfare, a cruise, merchandise, gift cards, a credit on your card, checking account, savings account or donation to a charity, or deposited to your USAA checking or savings account.
Low fees. The card has a $0 annual fee and there is no foreign transaction fee when spending outside of the country.
The benefits. It’s an American Express card, so it comes with the perks you’d expect from that brand. The card offers travel accident insurance, baggage insurance, trip cancellation/interruption insurance, travel assistance services, rental car insurance, price protection, extended warranty and access to USAA’s American Express Concierge Service.
Things to watch out for
- There’s no intro purchase or balance transfer APR rate.
- The regular purchase rate of 12.15% - 28.15% Variable APR and the balance transfer rate of 12.15% - 28.15% Variable can jump as high or higher than bank credit cards.
- And you’ll have to shell out 3% on balance transfers and cash advances; $200 maximum.
Eligibility: If you want this card, you must be an active or former military, an eligible family member or a cadet or midshipman.
Check out our list of top credit cards for military members from USAA here.
Secured: Savings Secured Visa Platinum Card
The card’s credit limit starts at $250 and is secured by the balance in your savings account.
Why we like it
Low rate. Many secured credit cards come with purchase APRs of between 25% and 30%, which can be steep if you don’t pay it off every month. But this card comes with a reasonable purchase rate of 13.99% variable APR and a balance transfer rate of 13.99% variable APR — and there is no balance transfer fee. The annual fee is $0, which is rare with secured credit cards.
A secured card that comes with rewards. Unlike most secured credit cards, this one actually allows you to earn points every time you use it. Cardmembers earn one flexpoint for every dollar you spend.
Those points can be redeemed at the credit union’s Flexpoints Rewards Program. Use them for cruises, airline tickets, hotels, cruises, car rentals, event tickets, gift cards, merchandise and charity. Earn more bonus points for $1 spent at the Flexpoints’ Shop Ampre Online portal.
The benefits: Again, you don’t expect to see any perks with a secured card, but this one comes with travel and emergency assistance services, lost luggage reimbursement and car rental insurance.
Things to watch out for
- No surprise here — you’re not going to get a sign-up bonus with this credit card.
- A credit check is required for new members.
Eligibility: Aside from being a State Department employee, you can also join the State Department Federal Credit Union the following ways: by having a relationship with more than 100 of the credit union’s organizational affiliates, like Voice of America; a relationship with a current member; or join the American Consumer Council for $8 a year.
Check out our roundup of secured credit cards.
Pros and cons of credit union cards
Pro: Potentially lower interest rates. Platinum credit cards offer higher credit limits and better perks. Ones issued by credit unions have average APRs of 10.05%, according to national market research firm Datatac. That compares with 16.46% APR for a similar bank-issued credit card, according to the Federal Reserve.
The fact that all federally chartered credit unions cap the interest rate on loans and credit cards at 18% helps credit union card rates stay relatively low. By comparison, some personal loans carry interest rates well into the triple digits and some credit card rates can easily go above 20%. “A consumer that consistently carries a $5,000 card balance will save roughly $200 annually in interest costs by using a credit union – rather than a bank platinum card,” said Mike Shenk, Credit Union National Association’s (CUNA) vice president of research & policy analysis.
Con: Lower branch presence. While they don’t have nearly as many branches as large banking companies, there’s online and ATM access, along with connections to other local credit unions for face-to-face service.
Pro: It’s getting easier to meet credit union eligibility requirements. Overall, nearly two-thirds of the country’s 5,600 credit unions offer credit cards to their members and the total dollar amount in credit union credit card accounts has nearly doubled since the beginning of 2008, Shenk added. Part of the rise might be due to the fact that it’s increasingly easy to meet criteria for credit union cards today. You may be able to qualify by making a small cash donation to an affiliated organization or charity if you don’t meet other requirements.
Fewer rewards and lucrative bonuses. Credit unions offer fewer options when it comes to checking and savings accounts, along with loans and credit cards. When it comes to their credit cards, they don’t tend to come with splashy sign-up bonuses, top points per dollars spent and a plethora of travel and purchase perks. But if having lower purchase and balance transfer interest rates on credit cards are important to you, then credit unions may be a good option, even with their pros and cons.
The bottom line
“The combination of favorable pricing differences and overall better service satisfaction are primary drivers of consumer’s increasing interest in seeking credit card accounts at credit unions,” said CUNA’s Shenk.
Credit unions can be attractive alternatives to banks thanks to their nonprofit status. They’re operated as cooperatives that answer to their members as opposed to banks, which are owned by and responsible to shareholders.
Because profit isn’t their biggest concern, credit unions tend to charge less for things like balance transfers, cash advances, foreign transactions, over-the-limit, returned check and late fees. And credit unions are more likely to work with you as a borrower if you don’t have the best credit score.
The truth is it can be hard for credit union cards to compete with general cards on the market. Those cards come with things like lucrative sign-up bonuses, more points per dollar spent for things like travel, dining, gas and groceries and travel and protection benefits.
But credit union cards come with lower purchase and balance transfer interest rates, they tend to not charge annual fees and they can be a little more forgiving when it comes to credit scores. Before hitting that apply button, figure out what’s most important to you — interest rates, sign-up bonuses, points per dollar spent and perks — when deciding between credit union and general credit cards.