Another cash back credit card is being added to the market. The last one was the TD Cash Back Visa Infinite Card, this time is the RBC’s turn. They are now offering a Cash Back Preferred World Elite MasterCard with the following highlights:

• $99 annual fee
• No annual fee for supplementary cardholders
• Earn 1.5% cash back on all purchases

This card also requires a minimum personal income of $70,000 or a minimum household income of $120,000. 

Let’s do a quick comparison with the TD Cash Back Visa Infinite Card:

• $120 annual fee
• $50 annual fee for supplementary cardholders
• Earn 6% cash back on gas, grocery and recurring bill payments (for the first 3 months or first $3,500 in spending for each category)
• Earn 3% cash back on gas, grocery and recurring bill payments thereafter (on first $15,000 in annual spending per category, including the 3 month bonus promotion)
• Earn 1% cash back on all other purchases

Personally, I think that there are enough other no annual fee cash back credit cards out there that offer at least 2% or more. So you would only use this credit card one other types of spending that do not give you a multiple bonus. Let’s assume that you would use the RBC credit card only on spending that would have only netted you 1% return.

That means, if you spend $20,000 per calendar year:

• $20,000 x 1% = $200 cash back with a no annual fee credit card
• $20,000 x 1.5% = $300 cash back, but subtract the $99 annual fee only nets you $201.

Therefore, you would need to spend $20,000 per year, on spending categories that would have only earned you 1% cash back to come out ahead.

I am not impressed with this credit card, but I am glad to see more competition being introduced to the market. RBC just needs to improve this product over time, but at least they have something to work with.

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