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The GM Card or Buypower Card by Capital One - how is it administered?


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This financial product helped me buy my current car.  I loved the "top off," which meant"rounding up."  It gave me an extra $700+ when I bought the last car.  They recently ran another "top off."

QUESTION(S):  How is this financial product managed?  I know the bookkeeping for each cardholder's account is separate, but are they managed separately like a trust ... or are they pooled?  I know they couldn't manage an individual cardholder's account, as in spending time doing that, but maybe they might manage them in tiers (accounts with similar amount in benefits, economic cycles, spending habits, goings-on and trends at GM, etc.)  

From what I recall, the usual take on credit card purchases is about 3%.  If someone doesn't take credit cards, they are either operating on slim margins ... or "never mind."  The GM product gives 5% on the first $5,000 spent in an anniversary year cycle, and then goes down to 2%.  Someone has to pay for that, especially the front loaded higher earnings.  That means that, if you put over $5,000 on it, you get $250 a year in the kitty.  You can put all your auto-pays on the card, for one.   Given the way financial markets have fared in the last 3 years, their providing and keeping benefits for cardholders seemed entirely feasible.

If anyone knows how Capital One might run the GM loyalty credit card program, it would be great if you chimed in.  

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Good to know, I have never had a loyalty card and have wondered what the interest rates are and how the program is run in comparison to other programs such as an airline mileage program. Seems here it is all about a percentage of money spent.

Interesting web site, will have to log in and read more.


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@dfelt  It is, but I wanted to know if a particular cardholder's kitty's performance affected whether they extended "top offs" to them and what the P&L picture for an account looks like along the way that makes it feasible over the "holding period?"

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