NEW: Capital One Cash, a Great No-Fee Cash Back Credit Card

Today, Capital One launched the new Capital One Cash, which gives a solid 1.5% back on all purchases made. It’s low-maintenance, with no annual fee or foreign transaction fee. In terms of straight-up rewards rate, it doesn’t fare well against the cash rewards heavyweights. However, its best feature is that in addition to giving rewards, it has one of the longer 0% introductory APR periods out there. We’ll break down the Capital One Cash’s benefits and compare it to the best cash back credit cards on the market. Read on!

Capital One® Cash Rewards - $100 Cash Back Bonus
	$100 Bonus after you spend $500 in the first 3 months 50% bonus on the cash back you earn every year 1% cash back on all purchases No annual fee Earn unlimited cash rewards that don't expire Redeem cash rewards anytime for any amount, even set up automatic redemption Personalize your card with an image of your choice 0% intro APR on purchases and balance transfers until May 2013
Annual Fee Signing Promo APR, variable* Intro APR Promotions $0 $100 Cash Bonus - for new accounts. Min APR: 12.9%(V) Max APR: 20.9%(V) Default APR: 29.4%(V) Cash Adv: 24.9%(V) Purchase: 0% until May 2013 Bal Trans: 0% until May 2013

Review: Capital One Cash

The card gives a flat 1% rewards rate on all purchases, but increases your rewards (spent or unspent) by 50% at the end of the year, so your effective rewards rate is 1.5% as long as you stick with the card. (Plus, you get your bonus all at once, which is pretty darn exciting). The card comes with a $100 cash back signup bonus.

Your rewards never expire, and you can redeem them via cash, check, statement credit, donation or gift cards. You can also automatically redeem your rewards by saying, for instance, that if you’ve accumulated more than $25 cash back by the third Tuesday of the month, you want a gift card.

It’s a no-frills card, as we’ve said, without the hassle of redemption tiers, spending caps, or enrollment bonus categories. It has no annual fee or foreign transaction fee, but best of all, it has a 0% purchase and balance transfer APR for the first 12 months. Most other balance transfer credit cards don’t give rewards at all.

Cash back credit card showdown

How does the Capital One Cash fare against our reigning cash back champions?

Capital One Cash vs. Chase Freedom

The Chase Freedom easily has better rewards than the Cash: it gives 5% back in rotating bonus categories up to $1,500 in purchases a quarter, plus an unlimited 1% back elsewhere. The Freedom also has a promotional $100 cash back signup bonus. It doesn’t have a 0% APR deal, so if you’re already carrying credit card debt or need to make a big purchase, you can get the best of both worlds with the CapOne Cash. However, if you’re just looking to maximize rewards, you should probably consider the Chase Freedom.

Capital One Cash vs. AmEx Blue Cash

The American Express Blue Cash Preferred is one of the most popular cash back credit cards. Like the Cash, it’s pretty simple, steering clear of thresholds or spending caps. Its rewards rate is quite high: 6% back on groceries, 3% on gas and department stores, and 1% elsewhere. It does have a $75 annual fee, though, so it doesn’t have quite the simplicity of the Capital One Cash. If you’re a big suburban spender (ie, you buy gas, groceries and clothes for a family) you’re better off with the Blue Cash, but someone whose spending patterns are more diversified will prefer the Cash.

Citi® Dividend World MasterCard® – $100 Cash Back

We wanted to compare the CapOne Cash with a credit card that has a balance transfer deal as well as rewards. The Citi® Dividend World MasterCard® – $100 Cash Back has a 0% APR period of 15 months*, but caps its annual rewards at $300. That’s $20,000 of spending on the Cash. If your annual spending exceeds $20k, you’re probably better off with the CapOne Cash’s unlimited rewards. On the other hand, if your spending is well below that threshold, you may prefer the longer 0% intro period.