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Chase Introduces a New Freedom Card and Increases Reward Values

Chase Introduces a New Freedom Card and Increases Reward Values

Benefits that makeover rewards holders of Chase Freedom Unlimited cards In a major update to the Freedom card lineup, announced by Chase on Monday, the rewards categories on its flagship consumer credit cards have been expanded. On September 15, the modifications—which also apply to travel purchases made through Chase's Ultimate Rewards online portal—will go into effect. They will add cashback bonus rewards to dining and drugstore purchases. The Chase Freedom Flex, a new Mastercard that will essentially replace the Chase Freedom card, will offer these along with the current Chase Freedom Unlimited.

Main Points

  • The rewards program for Chase's Freedom line of no-annual-fee credit cards is being updated.
  • Chase's new Freedom Flex card is available to any current Freedom cardholder without having to fill out an application.
  • The new Freedom Flex card and a redesigned Freedom Unlimited card offer competitive cash back rewards rates on travel, dining (including takeout and some delivery), and drugstore purchases.
  • In contrast to the current Freedom Card, which is a Visa, the Chase Freedom Flex card will have Mastercard World Elite benefits like cellphone insurance and Lyft rideshare credits.
  • Beginning on September 15, 2020, no new applications will be accepted for the Chase Freedom card.
In a time when many people aren't traveling, Chase's redesign adds enticing everyday spending categories. The updated Freedom Unlimited and the new Freedom Flex cards will now more directly compete with other no-annual-fee cash back cards like the Capital One SavorOne and the Wells Fargo Propel American Express, which also offer rewards on dining and other regular expenses.

Freedom Flex

A bank representative said that although, technically, the new Freedom Flex card is not a replacement for the Freedom card—current Freedom cardholders can keep their cards, and an upgrade is not automatic—no application is required for those who want to upgrade to the Flex card. Beginning on September 15, Chase will no longer accept new Freedom Card applications. Intriguingly complementing the rewards provided by the current Freedom Card, the new Freedom Flex card will offer rewards in both rotating and fixed categories. The cashback rewards will be given as Chase Ultimate Rewards points, as they are with the two current Freedom cards, but they are valued at 1 cent each. Cardholders with the Freedom Flex will specifically earn:
  • Five percent back on various purchase categories that change every quarter, up to a combined $1,500 in spending. The categories, like online streaming services and grocery stores, must be activated by the cardholder.
  • Travel purchases made through the Chase Ultimate Rewards website will earn 5%.
  • Restaurant purchases, including takeout and eligible food delivery services, earn 3 percent back.
  • 3 percent off of purchases made at pharmacies
  • 1 percent cash back on everything else, without limits
Additionally, new cardholders are eligible for two bonuses: a $200 bonus after spending $500 within the first three months and 5% back on grocery purchases (up to $12,000 spent) made during their first year with the card until January 13, 2021. Thanks to the addition of fixed rewards categories for purchases made at restaurants, retail stores, and travel agencies, the Freedom Flex card is now significantly more competitive against rotating bonus cards like the Discover it Cash Back Card, which also offers 5% cash back on categories that change every three months. These rival cards frequently don't offer any bonus at all, or very little, in other categories of spending. The earning rates on travel are exceptional when contrasted with other no-annual-fee travel rewards cards currently offered, which typically offer just 3 percent back on such expenses.

Freedom Unlimited

The Freedom Unlimited card was previously a straightforward cashback rewards card that gave 1.5 percent back on all purchases, regardless of what you bought. Following September 15, 2020, the card will provide:
  • When booking travel through Chase Ultimate Rewards, you receive 5% back.
  • Refunds of 5% on Lyft rides (through March 2022)
  • 3 percent off of meals (including takeout and eligible food delivery)
  • 3 percent off of purchases made at pharmacies
  • 1.5% back on all other purchases
The baseline rate, which will continue to be 1.5 percent back on all purchases, along with the new rewards-earning rates, work together to make the card stand out. On purchases that are not eligible for bonus earning categories, the majority of cards that are competing can only provide 1 percent back. Cashback is given out in the form of Ultimate Rewards points, just like the Chase Freedom Flex card. These points can be redeemed in a variety of ways, including for conventional cashback and travel, as well as for an increased value by transferring them to a premium Chase travel card. Note: The Freedom cards do not offer the option to transfer points to airline or hotel loyalty programmes, in comparison to Chase's Sapphire and Sapphire Reserve cards. Freedom cardholders, however, have the choice to move their points to these premium cards, giving them access to more advantageous redemption options.

Alex

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