Barclaycard CashForward World MasterCard Review: 1.5% Cash Back + $200 Bonus

Update – This offer is now EXPIRED.

Barclaycard has improved this offer by increasing the sign-up bonus to $200 after you spend $1,000 in purchases in the first 90 days. The $200 flat bonus makes this card work out better for those folks that don’t put a lot of purchases on their cards. For example, if you were to compare this card’s 1.5% cash back with a 2% cashback card with no sign-up bonus, you would have to spend $40,000 for the 2% card to catch up and break even. That could take years for some users. This offer now also has a 0% intro APR interest on purchases for the first 15 months.

Full Review:

Barclaycard has introduced a new cash back rewards card called the Barclaycard CashForward™ World MasterCard® which earns a flat 1.5% cash back on all purchases with no earnings cap. There is also no annual fee and an upfront sign-up bonus. Here are the highlights:

• Get a $200 cash rewards bonus after you spend $1,000 in purchases in the first 90 days after account opening
• Earn unlimited 1.5% cash rewards on every purchase
• Every time you redeem, get a 5% cash rewards redemption bonus to use toward your next redemption
• Redeem your cash rewards for a deposit into a U.S. checking or savings account, a statement credit or gift cards. Redemptions start at $50
• Cash rewards do not expire as long as your account is open, active and in good standing
• Enjoy a 0% introductory APR for the first 15 months on purchases. Plus, you’ll get a 0% introductory APR for 15 months on balance transfers for each balance transfer made within 45 days of account opening. After that a variable APR will apply, 15.99%, 20.99% or 23.99%, based on your creditworthiness. Please note, there is a fee for balance transfers
• No annual fee

I suppose the 5% cash rewards redemption bonus could be used to think of this card as a 1.575% cash back card (1.5% times 105%), but keep in mind that it is structured as an incentive to keep you using the card. For example, if you redeem $100 in cash rewards, you will get $5 added to your rewards balance good towards your next redemption. You have to reach $50 to cash out again. As noted in the comments, you could maximize your redemptions by leaving $50 in rewards so that you can cash everything out next time easily. Keep that in mind as your $200 bonus will also get that 5% bonus to become $210.

The competition. Chase and Capital One also have their own versions of 1.5% flat cash back:

• Capital One Quicksilver Cash Rewards Card Review
• Chase Freedom Unlimited Card Review

These competitors have higher effective cash back rates. Some have a few additional requirements which you may or may not find too much trouble.

• Citi Double Cash Review
• Fidelity Rewards Visa Credit Card Review (must have Fidelity account)
• BankAmericard Travel Rewards Credit Card Review (must have BofA or Merrill Edge account with $50k+ assets)
• USAA Limitless Cashback Rewards Card Review (must be USAA member and $1,000 monthly direct deposit)

If you put a lot of purchases on your credit cards, the gap between a 1.5% and 2% card widens. However, if you are a relatively light spender, it can pay to focus more on the upfront bonus than the cash back rate. For example, if you were to compare a card with 1.5% cashback + $200 upfront bonus with a 2% cashback card + no sign-up bonus, you would have to spend $40,000 to earn an additional $200 in cashback (and thus breakeven with the bonus). If you only charge $500 a month, that would take nearly 7 years. If you charge $1,000 a month, that would take over 3 years.

Bottom line. The CashForward World MasterCard is Barclaycard’s entry into the “simple, no hassle cash back rewards” category. The 1.5% cash back is competitive with similar no-annual-fee offerings from Capital One and Chase (with this card offering an additional small redemption bonus on top), but I would also compare it with the offerings from Citibank and other issuers listed above (especially if you are a big spender). Keep in mind that Barclaycard is currently offering the largest sign-up bonus in this category. You also receive a free FICO score updates from Barclaycard.