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If you’ve spent money at your local Target or Target.com anytime over the past few years, you’ve likely heard of Target REDcard, a family of debit and credit store cards that reward loyal Target customers with automatic discounts at checkout.
The Target REDcard™ Credit Card is the credit card version of the REDcard. It’s a no-annual-fee product that earns an across-the-board 5% discount on spending at Target stores and Target.com. Unfortunately, it’s not accepted outside the Target ecosystem, making it inappropriate for infrequent Target shoppers and not at all suitable for general spending.
The Target REDcard Credit Card is a bare-bones credit card, with few of the frills associated with more versatile cash back credit cards. For instance, it has no sign-up bonus, though you can sign up while checking out in-store or online and receive 5% off on that transaction. They also don’t have introductory interest promotions and don’t allow balance transfers or cash advances.
If you’re looking for a fancy store card or general-purpose cash back credit card, REDcard probably isn’t your thing. On the other hand, if you’re just looking for a way to stretch your Target dollars further, it’s hard to do better.
Discount Rewards Program
The Target REDcard Credit Card confers automatic, immediate 5% discounts on most spending at physical Target locations and Target.com, subject to certain important restrictions and limitations. Key transaction types that do not qualify for the 5% discount include:
- Spending at restaurants inside Target, such as Pret A Manger and Freshii
- Eye exams at Target Optical
- Prescriptions ordered and picked up at Target pharmacies
- Gift cards and prepaid cards purchased in-store and online
- Gift wrap purchases
- Wireless protection program payments and carrier-required deposits
Beyond these categories, there is no hard cap to the total value of discounts you can rack up in a given month or year. If you split payments for a single transaction between your REDcard and another form of payment, you only earn the discount on the balance paid with your REDcard.
Again, REDcard isn’t accepted at non-Target vendors.
The Target REDcard Credit Card and MasterCard come with 2 crucial additional benefits.
- Free Standard 2-Day Shipping: First, cardholders who pay with REDcard get free standard 2-day shipping on orders from Target.com, provided the shipping address is in the United States or Puerto Rico, or in the APO/FPO system. Upgraded (expedited) shipping still incurs shipping fees.
- Extended Return Windows: Second, cardholders enjoy extended return privileges, meaning they have 30 extra days to return purchased items after the regular return window expires. This benefit does not apply to nonreturnable items, Target Mobile purchases, and items with a fixed return date.
This card has no annual fee, foreign transaction fee, balance transfer fee, or cash advance fee. However, only MasterCard cardholders can make foreign transactions, and there is no allowance for cash advances or balance transfers. Late payments cost $37, while returned payments cost $27.
This card requires good credit. Major credit blemishes are likely to disqualify your application, but minor issues may be acceptable.
- No Annual Fee. The Target REDcard Credit Card doesn’t charge annual fees, so they’re great for frugal shoppers who want to maximize the value of their discounts. If you have access to a Target, but don’t shop there every week, there’s no downside to keeping this card in your wallet for those occasional Target runs.
- Great Discount Rate. This card’s headline discount rate of 5% is excellent. Basically, for every $100 you spend at Target, you get $5 extra. That’s better than the vast majority of cash back credit cards, as well as many competing retail and gas station credit cards.
- Immediate Discounts at the Register or Online Checkout. You don’t have to wait to enjoy this card’s rewards. Every time you swipe it at the register or enter its digits at Target.com checkout, you get 5% off your order. Some other retail cards, including Sam’s Club Mastercard and Costco Anywhere Visa, force you to accumulate your rewards throughout the year and redeem them all at once in a single shopping trip.
- No Limit to Discount Size. This card’s discounting power is unlimited – there’s no limit to the number or size of transactions to which its 5% discount applies. Some cash back cards limit spending in favored cash back categories to $6,000 to $10,000 per year, while some gas cards limit the number of gallons to which their discounts apply. Both limitations can be problematic for heavy spenders.
- Free 2-Day Shipping From Target.com. If you’re a frequent Target.com shopper, you’ll love this card’s free 2-day standard shipping perk. Fellow store cards, including offerings from Sam’s Club and Costco, don’t offer free shipping.
- Extended Return Period. This card gives you more time to try out larger purchases before fully committing to keep them. That’s particularly nice for cardholders who don’t make it to Target stores very often.
- No Acceptance at Non-Target Vendors. Target REDcard’s biggest drawback is the fact that it isn’t accepted at non-Target vendors. If you’re looking for a general-spending credit card that rewards you for purchases at a wide range of vendors and retailers, you need to keep looking.
- No Sign-up Bonus. The Target REDcard Credit Card don’t offer a sign-up bonus, though the fact that you can claim your first discount as soon as you sign-up at the register or online is certainly nice. Still, many cash back credit cards and some competing store cards (including Sam’s Club Mastercard) offer sign-up bonuses.
- No Introductory 0% APR Promotion. This card doesn’t have an introductory APR promotion for purchases or balance transfers. If you’re looking for a card with a long 0% APR interest window that allows you to finance large purchases or pay down existing high-interest balances, try the Chase Slate Credit Card or Citi Simplicity Credit Card.
- No Balance Transfers or Cash Advances. You can’t make balance transfers or draw cash advances with your Target REDcard. That’s a drawback relative to most cash back credit cards, including Chase Freedom and Discover it.
- Some Important Limitations to 5% Discounts. This card offers a 5% discount on most – but not all – Target purchases. Notable exemptions include pharmacy purchases, purchases at in-store optical centers, purchases at restaurants housed within Targets (such as Freshii and D’Amico & Sons), and gift cards. If Target is your go-to pharmacy or eye care provider, or if you’re a big fan of Target gift cards, these limitations could eat into your card’s earning power.
Though it’s far smaller than Walmart (its principal rival), Target counts millions of Americans as fans. Over the years, it has cultivated a well-deserved reputation for curating a great selection of quality clothing and home goods, in addition to offering competitive pricing for more humdrum household staples.
However, Target operates in a highly competitive industry and isn’t immune to missteps. Target’s attempt to break into the Canadian retail market failed quickly and spectacularly, as it shuttered more than 100 stores and destroyed thousands of jobs in a matter of months. And a massive data breach in 2013 exposed tens of millions of shoppers’ personal data, creating a massive PR headache that lingers to this day.
Given Target’s uneven recent history, it’s understandable that some consumers would be reticent to share more information than necessary with the retail giant. If you’re a regular Target customer whose hunger for a 5% discount on most in-store and online purchases outweighs your concern about privacy and security, the Target REDcard™ Credit Card offers great value. If you’re not a past or present fan of Target, no problem – the world doesn’t lack for great retailers, nor great retail credit cards.