Thread: Kroger Credit Card - Read This Before You Apply!

WARNING: The Kroger credit card is not what it seems. They may be a great grocery store but here’s what isn’t so great about the Kroger Mastercard.

Wherever you live, odds are there are Kroger-owned supermarkets in your area. In the Midwest they go by then name Kroger’s, in California it’s Ralph’s, and there are other regional names they operate under too. Combined, they are the largest grocery store chain in America. So you would think it would make sense to get their credit card, right? Not exactly. This Kroger credit card review will show you why…

The Signup Promo:
Some people call this the American bait-n-switch; reel us in with something upfront, only to leave us stuck with a crappy deal in the long run. This marketing technique doesn’t always mean it’s a ripoff, but when it comes to the Kroger card, many feel it is.

$25 new account bonus: For quite a while now, they’ve been running a promotion to get a $25 credit at their store when you apply and are approved for their store card (which they call the 1-2-3 Rewards MasterCard).

I don’t know about you, but that in itself is hardly enough of an incentive. It’s the same as those pitiful bonuses you see banks give out to signup for an account. $25 may be nice, but the honest truth it’s not worth the time and hassle.

Balance Transfer: Plain and simple, this is not a good choice if you need to transfer a balance. At the time of this review, it’s not even a 0% offer; instead it’s for 2.99%. Worst of all, it’s only for 9 months and not 12. Once you add the balance transfer fee on top of that, it makes no sense. There are so many better offers out there.

Interest Rate:
Of course these things constantly change, but at the time I’m writing this, the APR isn’t the worst I’ve seen but it’s not the best either. There are four different tiers which depend on your credit. At the time of this review it can be as high as 21.99%. Worst of all, it’s a variable rate which is tied to the prime rate (which will go way up once the economy is rocking and rolling again).

Kroger Credit Card Rewards:
They call their rewards program 1-2-3 Rewards points. For each dollar spent, here’s what they offer…

• 1 point on normal purchases
• 2 points at Kroger (and Kroger-owned) grocery stores. This excludes gas, alcohol, etc.
• 3 points on Kroger-brand products

Now read the fine print…
When you read about the above point structure, it sounds like you’re getting 1% on normal purchases, 2% at Kroger, and 3% on their brands… right? Unfortunately that’s not the case.

They only give you a $5 grocery coupon for every 1,000 points you spend. That only equals out to be…

• 0.5% rebate on normal purchases
• 1% rebate at Kroger
• 1.5% rebate Kroger brands

That’s pretty lousy, huh? Getting only half a percent cashback on your regular purchases is pathetic. Almost every other credit card offers double that. So the Kroger credit card offers no real value as far as rewards go

A Better Option
If you’re looking to earn only 1% cashback, odds are the cards in your wallet already give you that. If you want better, then check out the new Blue Cash Preferred that gives unlimited 6% at supermarkets. Yes, this site does advertise the card, but that's not why it's being recommended. Take a look and the numbers speak for themselves: Review the new Blue Cash Preferred from American Express

They charge 3% foreign transaction fee; 1% from MC who actually does the exchange and 2% from RBS Citizens(the issuer) for, well, not really sure what their fee adds.

But, here is the kicker, and this is something even Chase, B of A or Discover don't do.

They charge a minimum $1.50 fee. That is right, if you use your Kroger card to buy a lunch in Germany, it will cost you an extra $1.50.

Now, I never got a straight answer out of Kroger PF on who sets the minimum. Just some non-specific line about it being a combination of MCs and RBS fees.

So, if you use your Kroger credit card in another country, be ready to pay a high rate of fees for small purchase.

Thank you so much for explaining this! I had thought the Kroger Mastercard gave 3% cash back on Kroger brands, 2% at Kroger and 1% on other. This is very deceiving how their program is structured because I am used to one point equaling 1%. I will pass!

All of the above information about Kroger's 123 card is correct. I have had the card for at least 6 years. Over the years the points system was changed from the equivalent of 1% 2% 3% to 0.5%, 1% 1.5%. This was done quietly without official notice given. The card was originally issued by RBS bank - which experienced difficult times and dumped it's card program with Kroger. Then Kroger switched to US bank.

I have done my homework on grocery rebates and feel confident that the NEW American Express Cash Blue card for groceries is the way to go. 6% rebate - no annual fee the first year, then I think it is 75.00 per year after than. No max or minimum rebates, no limitations on which supermarket you can use. All of the supermarkets we ever visit take the AX card. Despite the annual fee, you come out way ahead of Discover and other grocery cards. we spend 1000.00 per month on groceries. I do not know how that compares to other families of 4. Discover gives you 5% only 3 months of the year on groceries.That is 720.00 per year. When you factor in the annual fee the net rebate percentage for us is 5.375% still not bad.

Originally Posted by RebateMaven

Discover gives you 5% only 3 months of the year on groceries.

Actually this year Discover only offered the 5% on groceries for ONE month! They have really destroyed their Cashback Bonus. I hardly ever use mine anymore. Don't get me wrong, I still like Discover, but there are way better cash back cards out there.