Our Verdict
The Upgrade OneCard* seems appealing at first because of its initial reward earning rate and lack of an annual fee. But when you look closer, you see that this card is all shine and no substance. The rewards you can get require too many hoops to jump through to be truly optimized. Plus, it lacks any kind of additional benefits, intro APR offer or other perks that would place it above its peers. You would be better off with a more generalized cash-back rewards card in almost all cases.
Pros
- The Pay Now, Pay Later feature is an interesting way to keep your finances on track
- Decent earning rate for everyday purchases, assuming you meet account activity requirements
- Potential for increased credit limit with linked bank account
- No annual or application fees
Cons
- Upgrade Rewards account required to earn maximum cash-back rewards
- 3% cash-back earnings capped at $500 per year
- Cash-back rate depends on account activity
- No additional card benefits
- Limited cash-back redemption options
Highlights
- Earn a $200 welcome bonus after opening a new Rewards Checking account and making 3 purchases
- Maintain a qualifying active Rewards Checking account and earn up to 3% cash back on qualifying spending categories (limited to $500 in rewards per calendar year; then earn 2%) and 2% cash back on all other eligible purchases
- Earn 1.5% cash back for all non-active Rewards Checking account holders on all purchases
- No annual fee
Introduction
The Upgrade OneCard bills itself as a cross between a debit and a credit card, with the fraud protections and rewards of a credit card but the interest-free purchasing power of a debit card. Technically purchases made on the card are personal loans and not a traditional line of credit, so multiple purchases on the card are a series of personal loans. And, to be fair, the card does have some appealing features.
There is an easy-to-earn welcome bonus of $200 after opening a new Rewards Checking account and making 3 purchases, and the Pay Now, Pay Later feature is interesting. With this feature, a cardholder can designate everyday purchases in the “Pay Now” category, and pay for the purchase immediately from their linked checking account, incurring no interest. Or, they can designate purchases as “Pay Later” and pay them down at a fixed interest rate over time. This might be a valuable tool for those on a tight budget, or those learning financial literacy, especially because you earn rewards on both “Pay Now” and “Pay Later” purchases.
In addition, the Upgrade OneCard offers the potential to have your credit limit increased when you link your Upgrade Rewards checking account to the “Pay Now” feature. The amount of extra purchasing power is dependent on your payment history and the balance of your checking account. A higher balance means more extra purchasing power, up to $5,000. But, while these things can be valuable, the card is not without its drawbacks.
To earn the maximum 3% rewards, cardholders must maintain an active Upgrade Rewards account—defined by the Upgrade OneCard as receiving direct deposits in your Rewards Checking account totaling at least $1,000 each month. This may not be a dealbreaker if you’re willing to reorganize your direct deposit from an employer, but there are plenty of other cards that offer similar rewards structures with no extra requirements.
The 3% cash-back earnings are capped at $500, after which the earn rate drops to 2%. And if you don’t meet the rewards checking activity threshold, that earn rate drops even further to 1.5%, a rate easily bested by other cards.
There are multiple other no annual fee cards that offer better rewards without all of the requirements of the Upgrade OneCard. Plus, the Upgrade OneCard offers no additional travel or purchase benefits commonly found on several no annual fee credit cards. And, cash back is automatically redeemed as a statement credit or can be redeemed as a direct deposit to your bank account only if you do not have a current balance. For these reasons, the Upgrade OneCard is going to be less than ideal for most consumers.
Compare Upgrade OneCard With Other Cards
Quick Facts
- Active accounts earn 3% cash back on qualifying spending categories (limited to $500 in rewards per calendar year; then earn 2%) and 2% cash back on all other eligible purchases. Earn 1.5% cash back for all non-active Rewards Checking account holders on all purchases
- Earn $200 after opening a new Rewards Checking account and making 3 purchases
- Pay Now, Pay Later feature lets you designate purchases for long term repayment at a fixed rate
- No annual fee
Upgrade OneCard Rewards
Earning Rewards
So long as you meet the activity threshold set by the Upgrade OneCard, you will earn 3% cash back on common everyday purchases, defined by the issuer as convenience stores, drugstores, restaurants and bars—including deliveries—and gas stations, as well as recurring payments on utilities and monthly subscriptions including phone, cable, TV and other streaming services. You will earn 2% cash back on all other OneCard purchases. The 3% cash back is limited to $500 in rewards per calendar year; after $500, you will earn 2% cash back. If you do not meet the Rewards Checking activity threshold, you will earn 1.5% cash back on all purchases.
Redeeming Rewards
Rewards you receive will be automatically applied to your balance after your next scheduled monthly payment. If you do not currently have a balance, you can choose to have your cash back applied as a deposit to your bank account.
Rewards Potential
For consumer credit cards, Forbes Advisor uses data from various government agencies in order to determine both baseline income and spending averages across various categories. The 70th percentile of wage-earning households bring in $116,000 annually; we base spending on that number.
According to this estimate, a household would be able to charge $36,177 to credit cards each year. Assuming they maintain an active account, and maximize their spending, this hypothetical family will earn $500 at the 3% cash-back tier, working out to $16,700 in spending. The remaining $19,477 in expenses will earn 2% cash back for $389.54 in rewards, for a total of $889.54 cash back at the end of the first year.
If this family does not maintain an active account, they will earn 1.5% cash back on all purchases for $542.66 in cash back.
Other Upgrade OneCard Benefits
- Virtual card option: Choose to have a virtual card account upon approval in addition to a physical card.
- Zero liability: Under Visa’s rules, eligible misuse of your card by a fraudulent third party means you aren’t liable for the amount.
- Contactless payment: The OneCard is chip enabled allowing for quick, contactless payment with Apple Pay or Google Pay.
Fine Print
Interest Rates
- Regular APR: 14.99% - 29.99% variable
- Purchase intro APR: N/A
- Balance transfer intro APR: N/A
Fees
- Annual fee: $0
- Balance transfer fee: Up to 5%
- Foreign purchase transaction fee: Up to 3%
How the Upgrade OneCard Stacks Up
Upgrade OneCard* vs. Chase Freedom Flex℠
The Chase Freedom Flex℠ is an all purpose, no annual fee card with superior rewards to the Upgrade OneCard. The Freedom Flex earns 5% cash back on up to $1,500 in combined purchases in categories that rotate quarterly (requires activation), 5% cash back on travel purchased through Chase Travel℠, 3% cash back on dining and drugstores and 1% cash back on all other purchases. While the everyday purchase rate is lower, the Freedom Flex still comes out on top due to its increased rewards in other categories.
In addition, the Freedom Flex has an intro APR offer: 0% intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 20.49% - 29.24% applies. Balance transfer fee of up to 5% (min. $5) of the amount of each transfer applies. And, it boasts a number of travel benefits, including extended warranty protection, cellphone insurance, and trip cancellation and interruption insurance, none of which the Upgrade OneCard has to offer.
Upgrade OneCard* vs. Citi Double Cash® Card
The Citi Double Cash® Card is like a Toyota Camry. It’s not the flashiest, but it’s reliable and gets you where you need to go. The Double Cash is a no annual fee card that offers 2% cash back on all purchases—1% when purchases are made and another 1% when they’re paid off with no caps or category restrictions. While this technically puts it below the Upgrade OneCard in rewards, the difference is slight. The OneCard only gets better rewards for the first $16,700 in annual spending. After that the two cards are equal assuming the OneCard holder has a linked Upgrade account. Otherwise, the Double Cash comes out ahead.
But what gives the Double Cash the edge are its additional features. The card has a 0% intro APR on balance transfers for 18 months. After that, the standard variable APR will be 19.24% - 29.24%, based on creditworthiness. An intro balance transfer fee of either $5 or 3%, whichever is greater, applies to transfers completed within the first 4 months of account opening. After that, the fee will be 5% of each transfer (minimum $5). This is potentially more valuable in managing debt than simply designating purchases as “Pay Now.” Plus, the card earns rewards in the form of ThankYou Points, a flexible currency that gives you many more options than Upgrade’s cash-back system.
The Double Cash offers $200 cash back after spending $1,500 on purchases in the first 6 months of account opening, fulfilled as 20,000 ThankYou® Points. In every other way, the Citi Double Cash is likely a better option.
Upgrade OneCard* vs. Discover it® Cash Back
The no annual fee Discover it® Cash Back earns 5% cash back on everyday purchases at different places each quarter up to a quarterly maximum of $1,500 in spending when activated. Plus, earn unlimited 1% cash back on all other purchases – automatically. So initially the Discover it® Cash Back will outperform the Upgrade OneCard. However, once the spending cap is hit, the OneCard will actually fare better with its 2% cash back rate to the Discover it® Cash Back’s 1%.
But the Discover it® Cash Back has a far superior welcome bonus where Discover will automatically match all the cash back earned at the end of the first year as a cardmember. There's no minimum spending or maximum rewards. If you use your card regularly, this end-of-year match would mean hefty rewards far surpassing anything the Upgrade OneCard can offer. And, the Discover it® Cash Back also boasts a 0% introductory APR for 15 months on purchases and eligible balance transfers. Then, a standard rate of 17.24% - 28.24% variable applies. A balance transfer fee of up to 5% of the amount transferred applies. Overall, these two cards are about equal; it depends what you want out of your credit card.
Is the Upgrade OneCard for You?
Probably not. There is certainly some value in this card. The ability to manage your finances on such a granular level might be helpful for some consumers. But for most people, you will be better served with a more generalized credit card. Certainly, financial literacy is important and you should never spend money you don’t have on a credit card. But, you can learn these skills with a low-risk card that will net you greater rewards and additional benefits. Which, at the end of the day, is what you really want from a credit card.
Methodology
Forbes Advisor considers a variety of criteria when assigning credit cards a rating. Cards are graded based on numerous factors, including:
- Annual fees
- Welcome bonus offers
- Ongoing earning rates
- Value of individual points or miles
- Included travel or merchant credits
- Additional cardholder benefits
Card features we expect cardholders to use the most often are weighted more heavily in our ratings. Altogether, the factors came together to provide a star rating for each individual card.
Read more: How Forbes Advisor Rates Credit Cards
*The information for the following card(s) has been collected independently by Forbes Advisor: Upgrade OneCard. The card details on this page have not been reviewed or provided by the card issuer.
