Discover the Best Credit Card for Online Shopping—Top 5 Picks
Ever since the pandemic, online shopping has seen a spike in popularity, making up about 22% of all sales in 2022.
If you’re in the market for a new credit card, this article covers a few things you should know to make an informed decision. We’ll cover the following topics:
- Advantages of using credit cards for online shopping
- Best credit cards for online shopping
- Most important factors to consider when choosing an e-commerce credit card
Advantages of Using a Credit Card for Online Shopping
Source: Nataliya Vaitkevich
Credit cards are a popular payment method, with nearly half the U.S. population (47%) opening an account in 2021.
Using credit cards for online shopping has several advantages:
What To Look For in an Online Shopping Credit Card
Source: Leeloo Thefirst
To decide which credit card works best for you, consider the following factors:
- Rewards—Think about where you shop most frequently and choose a credit card that offers the biggest rewards for those specific merchants.
- Fees—Choose a card that charges the lowest annual, foreign transaction, and balance transfer fees.
- Annual Percentage Rate (APR)—To avoid high interest rates, choose a credit card with a low APR.
- Requirements—Some credit cards require a higher credit score than others, so make sure you’re eligible before applying.
- Digital wallet compatibility—If you use a digital wallet for shopping, choose a credit card that’s compatible with it.
One additional factor that needs to be considered is security.
Instead of choosing a credit card based solely on the rewards, it’s important to also put emphasis on its security measures. To improve the safety of your online transactions, a credit card should:
- Offer zero-liability protection for unauthorized transactions
- Provide fraud monitoring and notify you of any suspicious activities
- Let you set spending limits to prevent large-scale fraud
- Alert you when a purchase occurs to help you detect fraudulent transactions immediately
- Allow you to easily pause or block the card in case you lose it or detect unusual activity
- Include two-factor authentication and verify each purchase via a text or email
- Have an EMV chip, generating a unique code for each transaction to prevent cloning
Best Credit Cards for Online Shopping
Source: Avery Evans
Below, we present five of the best online shopping credit cards, evaluated according to factors such as security, features, rewards, and other benefits they provide:
- Amazon Prime Rewards Visa® Signature Card
- Chase Freedom Flex℠
- Bank of America® Customized Cash Rewards Credit Card
- Wells Fargo Active Cash® Card
- American Express® Gold Card
The information in this article is current as of June 13, 2023.
Amazon Prime Rewards Visa® Signature Card—Best for Amazon Users
For users who shop at Amazon on a regular basis, the Amazon Prime Rewards Visa Signature Card can bring numerous benefits. It offers:
- 5% cashback on purchases made at Amazon, Amazon Fresh, and Whole Foods Market[1]
- 2% cashback on purchases made at restaurants, gas stations, drugstores, and on local transit and commuting[1]
- 1% cashback for all other purchases[1]
- 10% cashback or more in rewards on rotating categories and products on Amazon with the Prime membership[1]
The cashback is earned in the form of points, which can be used directly on eligible Amazon purchases or redeemed via Chase.com for cash, gift cards, and travel[2]. The card entails numerous travel perks and no annual or foreign transaction fee, as long as the user is an Amazon Prime member[3].
The Amazon Prime Rewards Visa Signature Card also comes with fraud and purchase protection. The user can get access to extended warranty and theft or damage protection for 120 days, up to $500 per claim and $50,000 per credit card[1]. Other security measures of the card include automatic account alerts[1].
Chase Freedom Flex℠—Best for Cashback
The Chase Freedom Flex℠ card is the go-to credit card for those familiar with the Chase Ultimate Rewards® system. It has one of the most generous cashback rewards programs in the market and doesn’t require an annual fee[4].
With the Chase Freedom Flex credit card, the user gets:
- 5% cashback on up to $1,500 in quarterly bonus categories[4]
- 5% cashback on travel purchases made through Chase Ultimate Rewards[4]
- 3% cashback for dining and drugstore purchases[4]
- 1% cashback on all other purchases[4]
Most rewards are worth 1 cent each, and the user can redeem them as a direct deposit, a statement credit, gift cards, or even Amazon purchases.[4] Points can also be used to book travel through Chase. The card also comes with a $200 welcome bonus provided the cardholder spends $500 in the first three months and several partnership perks involving Doordash, Lyft, and Instacart+[4].
The cardholder also gets extensions for eligible warranties under three years, as well as 120-day purchase protection against damage or theft up to $500 per claim and $50,000 per card[4]. The card comes with 24/7 fraud monitoring, and the user can get notified via text, phone, or email in case of unusual activities[4].
Bank of America® Customized Cash Rewards Credit Card—Best for Customization
For those who prioritize flexibility, the Bank of America® Customized Cash Rewards Credit Card might be the right choice. It offers:
- 3% cashback in a chosen category[5]
- 2% cashback for grocery store and wholesale club purchases, totaling up to $2,500 for the three categories[5]
- 1% cashback for all other purchases[5]
The cardholder can earn 25%–75% more cashback for all purchases if they become a Preferred Rewards member, which amounts to 3.75%–5.25% for purchases in a chosen category[5]. The user can receive awards as statement credit, direct deposit, Merrill account credit, or 529 account contribution[5].
The rewards don’t have an expiration date[6], and there’s no annual fee involved[5]. In the first 90 days after opening an account, the user gets a $200 online cash reward bonus if they spend at least $1,000[5]. They also get 0% purchase APR for the first 18 billing cycles[5].
Other advantages include a zero-liability guarantee, overdraft protection, and digital wallet integration[5]. The card contains contactless chip technology and includes monitoring and account alerts for effective fraud detection[5].
Wells Fargo Active Cash® Card—Best for Flat Cash Rewards
The Wells Fargo Active Cash® Card is an excellent choice for those who don’t want to be constrained by categories. It offers an unlimited 2% cashback on all purchases[7]. The rewards don’t expire, and the cardholder can use them to offset eligible purchases or redeem them as gift cards, account credits, or cash via an ATM[7].
Like the previous credit cards on the list, there is no annual fee[7]. It also includes a $0 15-month introductory APR for purchases and balance transfers[7]. Given the 3% foreign transaction fee[7], it’s more suitable for those who plan on shopping in the U.S.
The card comes with a $200 welcome bonus, provided the user spends at least $500 in the first three months[7]. It doesn’t offer many additional benefits and lacks purchase protection, but it does include zero-liability and cell phone protection against damage or theft if the monthly cell phone bill is paid with a Wells Fargo Active Cash Card[7]. It allows for contactless payments and the user can enable voice or two-step verification at sign-on[7].
American Express® Gold Card—Best for Purchase Protection
The American Express® Gold Card provides advanced purchase protection. While most credit cards offer $500–$1,000 per claim, the AmEx Gold offers $10,000 ($50,000 in total)[8].
Its rewards structure is as follows:
- 4 Membership Rewards® points per dollar for restaurants (takeout and delivery included) and supermarkets[9]
- 3 points per dollar for direct airline flight bookings or through American Express travel[9]
- 1 point per dollar for other eligible purchases[9]
Other rewards include up to $120 in yearly dining credits and $120 a year for Uber Eats or rides in the U.S.[9] The card offers a welcome bonus of 75,000 points after spending at least $4,000 within the first six months[9]. Unlike other cards on this list, the AmEx Gold entails a $250 annual fee[9], but it doesn’t charge a foreign transaction fee[10].
The card allows for contactless payments and comes with a mobile app, fraud alerts, and 24/7 customer support[9].
How To Protect Your Data When Shopping Online With a Credit Card
Although credit cards offer more robust security measures than other types of cards, your data might still become compromised in the case of fraud. If a cybercriminal manages to steal your card number and data, they can make unauthorized purchases, withdraw funds, and potentially open accounts in your name.
The occurrence of data breaches and identity theft incidents has been increasing. The cost of cybercrime is expected to reach $8 trillion in 2023 and $10.5 trillion by 2025. It’s crucial that you protect your personal and financial information when shopping online.
Fortunately, you can easily protect your data with a virtual card. It’s a random 16-digit card number with its own expiration date and CVV that you can use to shop online or over the phone. While tied to your existing bank account or a payment card, virtual cards mask your real financial information from the merchant and potential hackers. Even if a merchant’s website suffers a breach, your real data won’t be compromised.
Although many banks and other providers offer virtual cards, some of them entail fees and come with limited features. If you are looking for a secure virtual card that enables advanced control of your spending, check out Privacy.
Privacy Ensures Peace of Mind When Shopping Online
Source: Mediamodifier
Connect your bank account or debit card with Privacy and enhance your security when shopping online.
With Privacy, you can create Single-Use Cards that close minutes after a transaction is made, preventing potential misuse in the case of a data breach. Another option is to generate Merchant-Locked cards that are tied to a specific merchant. This renders them unusable elsewhere, even if someone gets hold of the numbers.
You can pause and unpause the cards as you please and set spending limits for each. These features are especially useful for managing subscriptions, allowing you to block unwanted charges and automatic renewals while you cancel the service.
With its rigorous security standards and fraud protection measures, Privacy is as safe of an option as any bank. It’s PCI-DSS compliant and abides by the OWASP best practices. It also has the BBB® accreditation, complying with best-in-class customer service standards and ethical business practices.
Check out some other features you can enjoy with Privacy:
*Provided the merchant accepts U.S. cards
Sign Up for Privacy and Shop Safely
Becoming a Privacy user is quite easy. You only need to:
- Create an account
- Fill out the required KYC information
- Add a funding source
- Request and generate your Privacy Card
As a user of the base tier, which is free for domestic transactions, you can create up to 12 virtual cards a month, set spending limits, pause and unpause the cards, and leverage the web app, mobile app, and browser extension. By subscribing to one of the other two plans, Pro or Premium, you can get:
- Up to 36 (Pro) or 60 (Premium) cards a month
- 1% cashback on eligible purchases totaling up to $4,500 per month
- Priority support
- Waived foreign transaction fees
- Dedicated account manager (Premium)
References
[1] Amazon, https://www.amazon.com/b?ie=UTF8&node=16070413011, May 2023
[2] Amazon, https://www.amazon.com/gp/help/customer/display.html?nodeId=GGLVZAP2LJJYRHWQ, May 2023 [3] Amazon, https://www.amazon.com/dp/BT00LN946S?bypass=1,May 2023
[4] Chase, https://creditcards.chase.com/cash-back-credit-cards/freedom/flex, May 2023
[5] Bank of America, https://www.bankofamerica.com/credit-cards/products/cash-back-credit-card/#interest-rates-and-fees, May 2023
[6]Bank of America, https://www.bankofamerica.com/credit-cards/terms-and-conditions/?campaignid=4063799&productoffercode=S7&locale=en_US, May 2023
[7] Wells Fargo, https://creditcards.wellsfargo.com/active-cash-credit-card?BLTSPLT=1D1TZF&sub_channel=SEO&vendor_code=G, May 2023
[8] American Express, https://www.americanexpress.com/content/dam/amex/us/credit-cards/features-benefits/policies/NAC-Benefit-Guides/PP-Benefit-Guide_316-404_EDT_10.20_REV_08.22.pdf, August 2022
[9] American Express, https://www.americanexpress.com/us/credit-cards/card/gold-card/, May 2023
[10] American Express, https://www.americanexpress.com/us/credit-cards/card-application/apply/prospect/terms/gold-card/36647-10-0/?pznOfferCode=YJ19-20M495-16JM-6KO#FeeTable, May 2023
