Who is This Credit Card Best For?
Prioritizes sticking to their budget while buying what they want and need
Attacks existing balances while avoiding new debt
Takes improving their finances seriously and wants recognition for using credit responsibly
The PenFed Promise Visa is worth considering for people who want to enjoy a fee-free credit card. The card offers a low balance transfer APR, but it’s not as good as a 0% APR balance transfer offer. The promotional rate lasts 12 months.
You’ll have to be OK with not earning any rewards on your purchases. If that benefit is important to you as a PenFed member, consider the PenFed Power Cash Rewards Visa Signature Card which pays up to 2% cash back on all purchases or the PenFed Platinum Rewards Visa Signature Card which pays extra points on popular categories. Or, if you need to transfer a larger balance, consider a card with a longer promotional period, like the Citi Simplicity.
Low ongoing APR
Low introductory balance transfer APR
No penalty for late payments
No ongoing rewards
Better balance transfer offers exist
No additional perks
PenFed Credit Union membership required
- No fees: The highlight of the PenFed Promise Visa is its lack of fees. There’s no annual fee, balance transfer fee, foreign transaction fee, or cash advance fee.
- Sign-up bonus: It’s uncommon for no-frills cards like this one to offer a sign-up bonus, but the PenFed Promise does. It’s the only opportunity to earn any type of rewards on this card.
- Low introductory balance transfer APR: PedFed found a middle ground with its balance transfer offer. Instead of providing a 0% introductory rate, the card offers a low 4.99% APR, but with no balance transfer fee on balances transferred between October 1, 2019 to March 31, 2020. There’s an opportunity for savings if you’re diligent about paying off any balance you transfer.
- Low ongoing APR: After the promotional rate expires, any balance left from your transfer will enjoy a relatively low interest rate. The highest interest rate on the card—17.99%—is only slightly higher than the current average rate on credit cards accruing interest charges, according to Federal Reserve data.
- No penalty for late payments: Late payments won’t hurt your wallet as there’s no late fee or penalty APR. However, that doesn’t mean you can be lax with your payments. Late payments can damage your credit score.
- No ongoing rewards: You won’t earn any rewards on this credit card, which makes it an unattractive option for anyone who wants ongoing value from their credit card.
- Better balance transfer offers exist: Look elsewhere if you need more than 12 months to pay off a balance transfer or want a chance to pay off your balance without accruing any interest charges.
- No additional perks: The PenFed Promise Visa isn’t just slim on credit card fees—it’s pretty lean on frills too. You won’t get the benefit of any perks like extended warranties, purchase protection, or travel accident insurance.
- PenFed Credit Union membership required: You can’t apply for the PenFed Promise Visa Card unless you’re a member of the PedFed Credit Union. Fortunately, there are several ways to join, and anyone can obtain a membership by opening and maintaining a savings account with at least $5.
PenFed Promise Visa Card Sign-Up Bonus
The PenFed Promise Visa Card offers a $100 statement credit if you spend $1,500 in the first 90 days of opening your account. While you’ll only need to spend $500 each month to earn the bonus, the sign-up bonus is pretty low, relative to sign-up bonus offers from other credit cards and the amount you need to spend to get them.
How to Get the Most Out of This Card
The absence of a balance transfer fee is one of the PenFed’s Promise Visa Card’s best features. It’s worth taking advantage of if you’re carrying a high interest rate on another credit card, but you must be able to pay off the balance in 12 months. Otherwise, if it takes longer to pay off your balance, you’ll lose the balance transfer savings once the regular APR kicks in.
Say you have a $5,000 credit card balance. If you transfer it to the PenFed Promise, you wouldn’t have to pay a balance transfer fee, and you’d have 12 months to pay it off while it accrues 4.99%. If you pay off the balance within that time, you’ll have paid $133 in interest charges. If you instead transferred the balance to a card with a 0% APR on balance transfers for 12 months but had to pay a 3% fee, you’d pay $150 upfront.
In the interest of maximizing value of this card, you may have to choose between making purchases and earning the statement credit or transferring a balance, and here’s why: If you transfer a balance, any purchases will start accruing interest right away unless you pay off the entire balance. Paying interest on purchases eats away at the value of the statement credit and the cost savings of the balance transfer.
You have until March 31, 2020 to transfer a balance, which means you could meet the sign-up bonus spending requirement once you open your account. Then, transfer the balance after you’ve cleared your purchases balance.
The PenFed Promise Visa Card is scant on value in terms of customer experience. The credit union doesn’t offer 24/7 customer service or an online chat. Cardholders can, however, use the PenFed mobile app to manage their credit card and other accounts with the credit union.
The PenFed Power Cash Rewards Visa Signature has industry-standard security features.
PenFed Promise Visa Card’s Fees
The PenFed Promise Visa Card shines in its lack of fees, even above industry standards. There’s no annual fee, foreign transaction fee, balance transfer fee, and even no cash advance fee.