Barclaycard® Ring MasterCard® is unique. Open-source projects, co-op’s, and other kinds of social experiments are flowering now, in the information age. Even a bank is hopping on board.
That’s right — the Ring card is “crowd-sourced.”
The idea (according to Barclay’s) is that the cardmembers can discuss and vote, via an online community portal, and Barclay’s responds in “real time” to their requests. The issues discussed could be fee changes, marketing ideas, alterations to the terms and conditions — basically whatever is important to you, the customer. Barclay’s provides feedback about the consequences of ideas, and periodically posts all relevant financial information so that everyone can participate in this credit card business. Members even get a kind of “returns” — but we’ll get to that in a second.
First, let’s talk fees. Very low fees. Ring from Barclaycard is designed for those who desire simplicity and dependability, and it shows in their fee structure.
There is an 8% APR for everything, all the time. It applies to purchases, balance transfers, and cash advances. This is not promotional, and it does not depend on your credit score. (It could still change if the prime rate changes, as to be expected.) 8% is quite low.
Even lovelier, you aren’t looking at many costs beyond that. Check this out:
- There is no annual fee — but that’s expected.
- The foreign transaction fee is 1% — considerably lower than the standard 3-4%.
- The cash advance fee is $1. Every time. (Typically, cash advance fees are 3% and at least $10.)
- The late payment fee is $25 max. (Usually it’s $35 max.) Plus, there is no penalty APR for paying late. What does happen is that your returns for that cycle (part of the Giveback program, see below) get given to charity.
- There is no balance transfer fee. Ever. In fact, you actually get 1% cash back on any balance transfers made in the first 60 days.
That last one is particularly sweet. No balance transfer fee — that alone makes this card worth having, as a back up, in case you suddenly find yourself in over your head. Now, if you are in the situation of already having a balance that you need to transfer, this may or may not be a good card for you.
Make a transfer with this card, and you get $0 transfer costs and then 8% APR. Or, you could opt for the many cards that have a 3% balance transfer fee and then 0% APR for some length of time. The longer ones right now are 12 to even 18 months. If you think you can pay the balance off in that time, go with one of those. On the other hand, if you can pay the balance off in four months or less, go with the Ring Barclaycard. (Four months is about how long it takes for the Ring’s interest charges to equal the 3% fee that you dodge.)
Barclay’s Ring card does not have a rewards program per se. What it does have is Giveback, a feature that gives cardmembers a share of the “estimated profits.” First, returns need to pass a certain “hurdle” to cover taxes, marketing costs, and shareholder returns. The Giveback pool is 70% of whatever is remaining. Then, individual shares of that pool are computed by taking into account the level of participation.
Your Giveback share is improved by referring others, paying on time, actually using the card, or opting for paperless statements. You can choose whether to receive it as statement credit, donate it to charity, or a split between both. Note that the charity donation is not tax deductible, but if you do choose that path, Barclay’s will match the donation dollar to dollar. We applaud them for this socially conscious practice.
So, in a sense, it’s sort of like a rewards program. Except one in which nothing is guaranteed. The idea is that the cardmembers get to share in the story of the company, become concerned with profits, and thus are motivated to participate meaningfully.
Interestingly, the Ring blog indicates that as of late, members have been asking for a true cash-back rewards program. The scheme the company has proposed would have three tiers of card, with the most rewarding one earning 1.5% cash back, but at a 16% APR. It also would receive no Giveback for purchases, but more Giveback for revolving balances. But remember that if you revolve a balance on a rewards card, you negate the the rewards with the interest charges. (At a 16% APR, even just one month accumulates interest that basically equals the cash back.) Watch this space — we’ll let you know if that card comes to be, and if it beats out the other 1.5% back option, the Capital One Quicksilver.
The truth is that the Barclaycard Ring is not a co-op card, not even close. Right in the terms and conditions, they admit that Giveback “is not based on the actual profits” and that “you have no property or other legal right in any aspect.” Having credit card members share in the profits and vote on the terms of a card is a great idea, but here that is all it is — an idea. Something to play around with.
Still, Barclay’s deserves credit for paying it lip service. Though Giveback isn’t actually the “profit sharing feature” it’s advertised as, it is based on a posted, easy-to-reference calculation. Although they don’t put up the real official financial statements, they do blog regular updates on financial performance. Not to mention that the genuinely low rates and fees are presented with clarity that goes above what’s required by law. All of this shows a true commitment to transparency.
The Bottom Line
The Ring card has no annual fee and never has a balance transfer fee, so it’s great to have as a back-up. Plus, with a constant low APR, it’s a good choice for anyone who typically carries a balance.
Or, it would be worth getting if you want to support the “crowd-sourcing” message.
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Don’t forget to check out our list of the best balance transfer cards.