Definition
An affinity credit card is a co-branded credit card that has the name of a special program, school or other organization on the card along with the name of the credit card issuer. Devised as a marketing tool, affinity cards pay a small percentage of all purchases to the featured group.
Analysis
Affinity credit cards were championed by MBNA as an incentive to groups to market its credit cards to their members. Other card issuers provided affinity cards, but MBNA was by far the largest issuer of affinity cards.
The purchase of MBNA by Bank of America has apparently shown a decrease in affinity card marketing in 2007 and 2008. Other card issuers have started moving toward personalized cards that pay little or no purchase percentage and have focused less on affinity cards. Capital One’s Card Lab program was a major marketing tool in the first part of 2008, in which “personalized” credit cards were the main focus as opposed to affinity programs.
Donations to affinity card program partners generally average around 1% of total purchases. Partners included alumni associations, professional sports teams and even nonprofit organizations.
