Gas Cards

Gas Cards Types

Gas cards are a specialty type of consumer credit card that offer bonuses or incentives for purchases made at gas stations and convenience stores, giving users a break on rising gas prices. There are two major providers of gas incentive cards: major credit card companies (Discover, Mastercard, Visa, American Express, etc.) and individual gas companies (Exxon, Marathon, Speedway, Hess, etc.). Both types of cards generally offer similar benefits, and consumers should examine each offer in detail in order to choose the plan that best suits both their credit needs and their driving habits.

Prepaid Cards

Some companies may also offer prepaid fuel cards. While these cards do not necessarily offer savings at the pump, they can be an excellent way to limit spending on items other than gasoline, particularly for students or other limited drivers.

Business Accounts

Most gas companies offer fleet accounts with multiple features to entice businesses to open exclusive accounts. In addition to providing a savings on fuel, these accounts may feature tracking numbers per card or per vehicle for company audits, fuel-only limitations to prevent misuse, and spending limits to curb fraudulent fill-ups.

Incentive Options

The hype around gas cards generally involves the wide variety of incentives available. Different incentive options may include:

• Higher than normal rebates on gas purchases
• Points to use toward gift certificates or merchandise
• Free credits for additional gasoline

While these incentives are tantalizing and promise significant savings, consumers should thoroughly investigate limitations, promotional periods, and overall usefulness before adding another credit card to their wallet.

Pros and Cons of Gas Cards

Depending on your spending and driving habits, gas cards can either be beneficial or detrimental. As with any credit card, there are pros and cons to these specialized lines of credit that consumers should be aware of before opening new accounts.

Pros

The biggest benefit of gas-specific cards is the accelerated rebate options for fuel purchases. Most cards offer higher rebate percentages and payouts for fuel sales along with standard rates for other purchases. These cards are an excellent choice for individuals who commute frequently and accumulate hefty mileage, or for small businesses that operate company cars and trucks. Different types of fuel savings cards may also be beneficial for college students, allowing parents to monitor driving use and help with gas costs.

Cons

Like any credit card, there are downsides to gas-specific cards. Introductory rates and promotional periods are often exemplary, but after those offers have expired, the rebate rates may drop while the overall interest rate rises. Some companies also put a fixed cap on rebate redemption, limiting the total savings per cardholder. Station-specific gas cards may not always represent the best possible deal on fuel, especially if competing gas stations frequently have lower per gallon rates, since most cards only offer a few cents off per gallon anyway. Depending on the redemption policy of each card, users may have only a limited amount of time to claim their incentives before the rewards expire.

One of the biggest cons about gas-related credit cards is also one of the least considered: opening any new line of credit puts the cardholder at risk for credit card fraud, and if you already have too many credit cards, a new card may lower your credit rating in the eyes of lenders. Any new cards also increases the chance of accumulating too much debt.

Choosing the Best Card for You

If you are interested in gas cards, investigate each offer before filling out an application. Furthermore, analyze your own driving habits – do you always fill up at the same gas station company? A station-specific card may offer better rewards for your use. The best savings will come from responsible credit card use, whether you have a station-specific card or a more general incentive card. If you fail to pay off the balances each month and accrue interest rates, you may end up paying more for that gasoline, despite the small refunds offered through the credit card.