After making strong gains among millennials, Uber has introduced a credit card rewarding the kinds of purchases millennials tend to make. The card's cash-back rewards are unusually generous, according to credit card experts.
The Uber Visa card, available November 2, pays four percent cash back on restaurant purchases, three percent on hotel and airfare, two percent on online purchases (including Uber rides), and one percent on everything else. The card does not charge an annual fee or foreign transaction fees, and customers can redeem rewards for Uber credits, gift cards, or cash.
The card also features an annual subscription credit that can be used on services like Spotify, Netflix, or an Amazon Prime membership. Included in the cardholder agreement is coverage for mobile phone theft or damage.
Targeting millennials
Nerdwallet credit card expert Kimberly Palmer points out that consumers previously had to choose between the Chase Sapphire Reserve or American Express Platinum cards to receive comparable rewards. However, both cards carried hefty annual fees.
“To directly target millennial consumers, the Uber Visa lets cardholders redeem rewards in Uber rides or UberEATS orders straight from the apps, in addition to getting cash back or gift cards,” Palmer tells ConsumerAffairs.
“If you’re a frequent Uber customer who wants to avoid annual fees without foregoing perks like Spotify, Netflix, and Amazon Prime subscription credits, the Uber Visa is definitely worth considering.”
Uber trending upward
For Uber to target millennials with a new credit card might not seem that surprising when you consider the ridesharing company has made big inroads among that group lately.
When YouGovBrandIndex recently looked at companies favored by millennials, it found Uber led all brands with the biggest gains. Uber's share of millennial customers rose eight percent to 26 percent of all millennials in the first half of 2017. Rival Lyft, meanwhile, gained six percent for a marketshare of 12 percent.
Among the brands favored by millennial consumers, Uber made the biggest gains in the first half of this year, followed by Instagram, Lyft, Snapchat, and TLC.