Back in November, US Bank caused a stir with the launch of a new product called the Smartly Visa Signature Card. At its base, it’s simply a 2% cashback card, but magic happens when you have at least $100K on deposit with US Bank, transforming it into a 4% everywhere cashback workhorse.
The $100K deposit requirement includes investment accounts and IRAs, making it a more easily-achieved hurdle than it might initially seem. However, once folks started to jump on board, we began to hear tales of tiny credit limits and issues with large purchases, although many others were able to proceed full steam ahead.
A couple of weeks ago, we reported that some Smartly cardholders were receiving letters from US Bank telling them that, if they continued using the card for “business purchases,” it would be cancelled. No one was quite sure what triggered those letters, or what specific activity it referred to, but it seems likely that it was related to total purchase volume.
Now, we’re hearing from reddit, Doctor of Credit and Danny the Deal Guru that new Smartly Visa applications are not being accepted in US Bank branches and product changes are no longer being allowed. There’s more than one report saying that bankers believe that changes are coming, which might include retirement accounts no longer counting towards the deposit requirement, an annual cap being placed on the 4% earnings or the card being discontinued completely.
Quick Thoughts
It should be noted that these are rumors so far, although I did call a local US Bank branch and was told by a banker that the only way for me to get the card would be to apply online. So it does seem like in-branch applications are suspended, which is a little bizarre to me. You’d think that they would suspend online applications first and keep in-branch going.
Since the card was initially launched, Greg has felt like it’s only a matter of time before limits will be placed on the 4% earning rate, as it would end up being a giant money suck for US Bank. I think Greg’s right and, based on the smoke we’re seeing, it seems like there’s fire here.
The reports that we’re seeing, combined with the suspension of in-branch applications and the warning letters that were sent out earlier this month, seem to add up to US Bank seeing more “abuse” than they were anticipating…and moving quickly to stop it. Who knew that offering a 4% cashback everywhere card might be expensive?
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Certain changes have occurred to the Smartly checking account as well. This should be no surprise to anyone. US Bank has been on a path of devaluation for a year and a half +/-. Expect more to follow. While US Bank is the fourth largest bank by assets, its leadership and product strategy are unsophisticated. When it’s venture beyond the plain vanilla, it’s had its fingers burnt and had to backtrack.
“When it’s venture beyond…”
This grammar is unsophisticated.
US Bank is the 7th largest bank by asset as of 9/30/2024.
I product changed from the Altitude Go card about six weeks ago and received/activated the Smartly card. My account still shows the Altitude Go card when I view it online. I called a support rep a week ago, and she said there was a known issue that they’re working on, but assured me I am earning cash back per the Smartly terms….. I haven’t seen that cash back appear.
I product changed 2 cards to 2 Smartly cards and the transition period took several weeks. In the USB app, if you go to the rewards tab of your Smartly card, does it show the 2% + 0% on recent transactions?
Yes it does! That’s encouraging.
Mine went from “2% + 0%” to “2% + 0.5%” to “2% + 2%” over a few weeks.
I’m just happy (and kind of astonished) that grandfathered AR keeps on keeping on.
Following
It is difficult to comprehend that US Bank didn’t anticipate this….
I’m shocked that a card having what manufactured spenders love is attracting manufactured spenders!
What could possibly have gone wrong?