The Rise and Fall of the Uber Credit Card
In the fall of 2017, Uber announced they were launching their own credit card in partnership with Barclays and Visa. Most of these co-branded credit cards suck, but the Uber credit card was different. It offered above-average cashback and perks tailored for the Millennial consumer.
Here are some of the highlights of the card at launch:
- 4% cash-back on dining (including UberEats)
- 3% cash-back on hotels and airfare
- 2% cash-back on all online purchases
- $50 credit for subscription services (Netflix, Spotify, Prime, etc.)
- $600 mobile phone damage insurance
The best part was all of this came with no annual fee and no foreign transaction fee. There are plenty of other credit cards with great perks and cashback, but they usually come with at least a $100 annual fee. Needless to say, this quickly became my go-to credit card for almost every purchase. It was great when traveling too. A lot of the best reward credit cards are American Express, but Amex isn’t as widely accepted globally as Visa or Mastercard.
To see how valuable these reward rates could be, the average American spends $232 a month dining out, and I would argue most people I know spend double that per month. The cash-back rewards add up quickly with 4% cashback on dining — easily $20–30 a month. Cashback could be redeemed for a statement credit, gift cards, Uber credits, etc.
All of this did come at the cost of your personal data. They won’t get an itemized receipt of what you’re buying, but they can see:
- where you go
- when you go there
- how much you spend there
It would be very valuable data for a ridesharing app to know when you go out to eat, where you go out to eat, how much you spend. Personalization, cohort building, and recognizing patterns could be used to increase their revenue from Uber rides and revenue.
I imagine the goal here for Uber was if you pay for dinner, you would then get a push notification prompting you to book a Uber ride home, or even suggesting a place to go next. If your habit is to go out to dinner every Friday night at 6 pm, they could advertise through push notifications a new place you might like (based on your recent dining history) earlier in the day or week when you may still be deciding where to go. The data shows that Millennials don’t mind this type of advertising when it is personal to them.
But none of that ever seemed to happen…
As a user since launch, I never got any personalized offers or targeted ads that I can remember. I’m not sure if they failed to get advertising partners onboard, but it seems like a missed opportunity.
Towards the end of 2019, they announced a major revamp to the card. They increased the reward rate for Uber to 5% while cutting the reward rate for dining to 3%, removing the cashback for online purchases, and removing the streaming credit. Getting rid of all of these at once made the reward offers average at best unless Uber was your main mode of transportation. Then the biggest change…
Cashback would only be redeemable for Uber Cash (a credit to your Uber account that can be used for Uber and Uber Eats deliveries). You would no longer be able to redeem your points for statement credits or cash.
By June of 2020, only six months after the revamp, Barclays confirmed the card was being closed for new applications. They did not say if the decision to cease applications for this card came from Uber or Barclays.
This month, Barclays announced that all Uber credit card holders would be transitioned over to their Barclays View Mastercard in October 2021. This card is not available to public applications. Overall, the card has a much better rewards program than the revamped Uber card so in that regard it is an improvement.
- 3x points on dining
- 2x points on internet, streaming, phone, and TV
- 2x points on grocery purchases
- 1x points on everything else
It’s unclear why exactly the card is being discontinued, but it feels like this was a missed opportunity rather than a market failure. Like I mentioned, I never received any offers (personalized or otherwise) in the entirety of the four years I’ve had the card. So while, it’s disappointing to see what could have been a unique card in the market disappear, it never reached its full potential to begin with.
Market conditions may have been another factor in the discontinuation. More people than ever are “reward hacking” credit card offers and perks. With the original reward program for this card, I could see this costing more than expected. Barclays also has a track record of changing card benefits or discontinuing them. For example, the Arrival Premier card was discontinued mere months after being introduced in 2018.