Executive Summary

• Amazon recently released a revamped rewards card for its Prime members that offers 5% cash back on Amazon purchases and solid rebates on other purchases.
• The card has no annual fee and those who sign up for it receive a $70 Amazon gift card, which mostly offsets the first year’s $99 fee for an Amazon Prime membership.
• While the card is not likely to be the “Costco killer” that some in the industry have been suggested it will be, it offers a solid mix of features and is most compelling for those who shop heavily on Amazon.com.
• The card represents another valuable service Amazon is offering its Prime members as well as another perk of joining the program.
• The card’s offerings are competitive versus those of other leading cards, and affiliated credit cards can have a meaningful impact on retailers’ earnings, as evidenced by Costco’s switch from an American Express card to a Visa card.