Credit Card News
TD Introduces “Subscription-Based Credit Card ” TD Clear
Today, TD Bank announced a new credit card offering while also making some updates to a couple of their other products. First, the bank introduced a new and unique card offering: TD Clear.
TD describes the Clear card as a “subscription-based credit card” that charges a monthly fee rather than interest. Currently, customers can choose to get a TD Clear card with a $1,000 credit limit and a monthly fee of $10 or opt for a $2,000 credit limit with a $20 per month fee. While there is a monthly fee, Clear cards do not charge foreign transaction fees, cash advance fees, or over-limit fees.
Commenting on the offering, TD Bank’s Head of Credit Cards and Unsecured Lending Chris Fred stated, “This card is the first of its kind in the U.S. Our research indicated that many customers want a simple solution to credit.” Fred added, “TD Clear provides simplicity with a predictable monthly payment.”
In addition to debuting the Clear card, TD also made some other updates to its credit card portfolio. Among them, the bank is making it easier for Double Up customers to earn cashback. Now, customers can simply earn 2% back on all purchases regardless of how they redeem their earned points. Previously, since the card’s premiere in 2021, customers would need to redeem points for deposits into qualifying TD Bank accounts in order to earn full value.
Meanwhile, the TD Cash card is also getting a refresh. While the card previously earned customers 3% cashback on dining purchases, 2% back on grocery purchases, and 1% back on everything else, the card will now feature greater customization. With this update, each quarter, cardholders will be able to choose their 3% and 2% categories from the following options: dining, entertainment, gas, grocery, and travel. Of note, new cardholders will still begin with the default options (3% dining and 2% grocery) but will be able to make their selections in subsequent quarters. All other purchases will continue to earn 1% back.
My thoughts:
Overall, there’s a lot to process with TD’s announcements — so we’ll start with the two current product updates. First, removing the account deposit requirement from the TD Double Up card definitely makes the card more attractive and puts it on par with the Citi Double Cash card and the Wells Fargo Active Cash Card. As for the TD Cash updates, while the ability to customize your categories is nice, it still doesn’t make the card terribly competitive. For example, the Capital One SavorOne already offers 3% back on dining, entertainment, and groceries (in addition to other perks). Therefore, there are likely better options (including the Double Up card) for most customers.
Finally, while the TD Clear card is certainly unique, it’s hard to imagine that it’s a good deal for many consumers. Instead, they may be better served by more traditional secured card or even debit-secured credit hybrids that have popped up in recent years. With all of that said, it is interesting to see TD making changes and trying new things… even if they aren’t all winners.
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