Update 8/18/22: Applications have been paused or discontinued on this card since June 1, 2022. No word if they’re coming back. (ht ProudMoney)
Original Post 2/1/18:
The leaked Chase Starbucks Visa card is now live for applications. Here’s our review of the card.
Rewards and Key Details
- $49 annual fee, not waived first year
- 3% foreign transaction fee (even international Starbucks transactions will probably be hit with this fee)
First, a quick overview of the Starbucks rewards program: All Starbucks Gold members get 2 stars per $1 spent at Starbucks. Get a free drink or food item after reaching 125 stars ($62.50 in spend).
Credit card rewards offering:
- Get instant Gold status on the Starbucks loyalty program which typically takes 300 stars ($150 in spend) to reach
- Earn 1 star per $4 spent everywhere outside Starbucks (free item after $500 in spend)
- Earn 1 star per $1 spent on Starbucks purchases only when reloading your Starbucks balance via the app (if you pay directly at Starbucks you’ll earn the regular earn rate of 1/$4). The 1 star per $1 earned on Starbucks app reloads is in addition to the standard 2 stars per dollar earned by Gold members on all purchases. In total, you’ll end up with 3 stars per dollar, but again, the credit card is only adding 1 star extra per dollar.
- 8 Barista Picks: Curated food or beverage Rewards selected by baristas and automatically loaded to the cardmembers Starbucks Rewards account. These are random picks that get sent to you, not something you can choose. This benefit will load to your account 45 days after becoming a cardmember and will reset each cardmember year. Barista picks expire after 30 days.
- Earn 2,500 stars (20 free drinks) after spending $500 within the first 3 months. Update 7/16/18: Now comes with 4,500 stars bonus after $500 in spend. Update 3/6/19: Now comes with 6,500 bonus stars after $500 in spend.
- Earn 250 stars (2 free drinks) when using the Starbucks Visa card to load your Starbucks card in the app for the first time.
It’s important to note that the Starbucks Stars program comes with a 6-month expiration on stars, and this expiration is the same for credit card holders. This is especially important to keep in mind with regards to the signup bonus since you’ll have to use up all 22 free items within 6 months.
Also remember that Starbucks stars can be used for almost any free item – it’s not limited to a drink. I don’t know what the most expensive item available is, but there could be some good value for those who anyway find themselves buying expensive food items from Starbucks. On the other hand, a typical drink runs $2 – $5, so keep that in mind when determining the value of the rewards program. Chime in below if you have a better analysis on what good values can be had.
The Chase Starbucks Visa card is not available to current cardmembers or previous cardmembers of this credit card who received a new cardmember bonus for this credit card within the last 24 months. The Chase 5/24 rule does apply to this card.
Upon approval, you’ll be able to use a digital version of the credit card immediately in the Starbucks app (but not elsewhere).
Card comes with standard Chase card benefits like purchase protection, extended warranty, price protection, and car rental insurance.
The $49 annual fee is quite a surprise – doesn’t seem like the way to target a Starbucks audience. The foreign transaction fee is a surprise to me as well. And they definitely should not have a 6-month expiration on stars for credit card users.
When analyzing the regular earnings rate on the card, it’ll depend entirely on what you buy for your free item. Most drinks are $3 – $5. If we take a $4 average redemption value, that’s less than 1% back on everyday spend, and it’s slightly over 3% back on Starbucks purchases. If there are $10 items to be had at Starbucks, that would give us a valuation of 2% everywhere ($500 spend gets $10) and 8% at Starbucks ($125 spend gets $10).
Overall I consider this a pretty bad card for almost everyone. The sole exception would be someone who spends a lot at Starbucks and likes to buy the most expensive food items, and even then it has to be calculated against the annual fee. Also, remember you’re losing out by loading the Starbucks app directly and not going through MPX or other venue to buy a discounted Starbucks gift card to load to the app.
If not for the annual fee, there would probably be Starbucks aficionado’s who would go for the card, but I think the annual fee will hinder most of them – that annual fee is a huge mistake, as I see it, since it’ll knock off a good percentage of the base they’re after. They should make it fee-free with only 2 or 3 free baristas (if that’s what they are worried about cost-wise).