Kroger has announced that its rewards credit card program is ending, with existing accounts moving to the U.S. Bank Smartly Visa.
Cardholders will lose Kroger-specific perks, including enhanced cash back on certain purchases and an additional fuel discount.
The change affects the credit card program; Kroger’s regular shopper loyalty rewards will continue.
Kroger shoppers who rely on the chain’s rewards credit card to stretch their grocery and gasoline budgets are losing some of those benefits as the retailer’s partnership with U.S. Bank ends.
Existing Kroger credit card accounts are being converted to the U.S. Bank Smartly Visa, with the transition expected to be completed this fall. U.S. Bank will continue to own and service the accounts, according to the bank’s announcement.
The change ends the Kroger-branded credit card arrangement. It does not eliminate the retailer’s separate shopper loyalty program, through which customers can continue earning and redeeming points. A spokesperson for Kroger-owned King Soopers confirmed that its loyalty program continues despite the credit card change.
What’s going away
For credit card customers, the biggest loss may be the higher cash-back rates available through Kroger Pay and eligible mobile-wallet purchases.
The Kroger card offered 5% cash back on the first $3,000 in eligible Kroger Pay purchases each calendar year, dropping to 2% afterward. Eligible mobile-wallet purchases had a separate $3,000 annual limit for 5% rewards, followed by 1%. Those benefits will disappear with the conversion.
The replacement card offers 2% cash back on eligible purchases, with full value available through qualifying redemptions, including statement credits or deposits into eligible U.S. Bank accounts. Converted customers also receive 3% back on grocery and gas purchases during their first 12 months, according to media reports.
Other Kroger-specific benefits are ending. The additional five-cent-per-gallon discount at Kroger Fuel Centers stops when customers activate their replacement card. Complimentary Boost memberships obtained through the credit card will remain available through their current expiration dates, but the new card does not include that benefit.
What to do
Customers do not need to submit a new application. Replacement cards are being sent between August and October, and existing balances, credit limits and earned rewards transfer automatically. Current APR terms carry over, and there is still no annual fee.
The financial effect will depend on spending habits. Customers who regularly qualified for 5% rewards could earn less, while those using the card for purchases previously earning 1% could benefit from the replacement’s higher base rate.
Cardholders should review their transition notices, check when their complimentary Boost membership expires and update recurring charges as necessary because replacement cards have new account numbers and expiration dates. Questions about individual accounts can be directed to the number on the back of the card.