This card now gives a whopping 3% cash back on all purchases

The USAlliance Visa Signature Card is giving 3 points per dollar on all purchases – essentially 3% cash back – through at least the end of 2021.

The promotion, which began April 1, puts it at the very top of the flat-rate cash back credit cards market, especially considering it does not charge an annual fee. The card previously gave 2 points on every dollar spent. Anyone can join USAlliance Federal Credit Union for free, either based upon where they live or work, or by joining a partner organization.

The main catch is that we don’t know what will happen to the card in 2022 and beyond. “The hope is that we will be able to extend this offer into 2022, but for now, we’ve committed to rewarding our Signature card-holding members with the opportunity to earn 3 points per dollar across the board on all purchases for the remainder of 2021,” USAlliance Financial president and CEO Kris P. Vanbeek said in a press release.

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How it compares to other cards

The most similar offer I can think of is the Discover it Miles card, which essentially gives 3% cash back on all purchases in a new cardholder’s first year. Technically, that card gives 1.5 miles on each purchase, and the welcome bonus is to match all miles earned at the end of the cardholder’s first year.

Each mile is worth 1 cent apiece when redeemed for cash back (as a bank account deposit) or to cancel travel purchases made within the past 180 days or to shop via PayPal or Amazon.com. The Discover it Miles card doesn’t charge an annual fee, either.

If USAlliance doesn’t extend its promotion into 2022, Discover has a longer 3 miles per dollar promotion, since it’s based on the cardholder’s first 12 months rather than the 2021 calendar year. But after that, the earn rate is cut in half to 1.5 miles per dollar, whereas the USAlliance Visa Signature has a normal rate of 2 points per dollar on each purchase.

The best flat rate no annual fee cash back cards normally top out at 2% cash back. Examples include the Citi® Double Cash Card (1% when you make a purchase and another 1% when you pay it off) and the PayPal Cash Back Mastercard. There are also several offerings that give the equivalent of 2% cash back if you meet certain requirements, such as depositing into an account opened with the same financial institution or using your rewards to pay down existing debt held by that institution. Those include the Fidelity Rewards Visa Signature card, the TD Double Up Card and the SoFi Credit Card.

Two credit union cards give 2.5% cash back on all purchases, although both charge a $99 annual fee after the cardholder’s first year: the Alliant Visa Signature Credit Card (capped at $10,000 in qualifying purchases each monthly billing cycle) and the Farmers Insurance Federal Credit Union Crystal Visa (which comes with a 3% cash back payout on all first-year purchases and a $100 bonus after spending $5,000 in the cardholder’s first three months).

You can join Alliant Credit Union by becoming a member of its partner charity, Foster Care to Success. Alliant will pay the $5 membership fee to Foster Care to Success on your behalf. And it’s possible to become a Farmers Insurance Federal Credit Union member by making a one-time $8 donation to the American Consumer Council.

To justify the $99 annual fee relative to a 2% cash back offering that does not charge an annual fee, you’d need to spend more than about $20,000 per year on the 2.5% cash back card.

See related: When is a credit card annual fee worth it?

Additional details

Buried in the fine print, USAlliance says its promo is limited to the first 3,000 new cardholders who sign up (along with all of its existing cardholders). That’s another big catch. If you can get in on it, though, this is a stellar deal. The card also comes with a host of other perks, including price protection, purchase protection, cell phone insurance, extended warranty coverage and trip cancellation/interruption benefits.

The simplest way to redeem your USAlliance Visa Signature rewards is as a statement credit (each point is worth 1 cent). The same ratio pertains to gift card redemptions, canceling out travel purchases and redeeming cash into a USAlliance checking account. Statement credits and cash deposits must be made in increments of 2,500 points ($25). It’s also possible to exchange your points for merchandise, although you’ll probably get less than 1 cent per point if you choose that option.

Bottom line

The USAlliance Visa Signature Card is definitely worth a look if you’re interested in a high cash back rate and no annual fee. Its additional perks are impressive as well. The price protection benefit, which reimburses cardholders up to $1,000 per item and up to $4,000 per year when they find a lower price within 60 days of buying something, stands out. Few other cards offer that coverage.

This card may not be as attractive in 2022 and beyond, but even if it drops back to 2 points per dollar, it would still be on a short list of the best flat rate cash back credit cards.

Have a question about credit cards? E-mail me at ted.rossman@creditcards.com and I’d be happy to help.