Bank of America Joins the Wave: Enhances Rewards Program for Electric Vehicle (EV) Owners
Key Insights:
Bank of America has embraced the electric vehicle (EV) revolution by upgrading its rewards program to cater specifically to EV owners.
The expansion includes the Customized Cash Reward card, which previously provided a 3% cashback benefit on gasoline station purchases, now encompassing electric vehicle charging stations as well.
This move mirrors the footsteps of other credit card companies that have introduced specialized rewards for EV-related expenses over recent years.
Given the projected surge in EV purchases, it’s anticipated that almost 20% of all new car acquisitions in 2023 will be electric.
Bank of America’s motivation for this step stems from a notable 44% surge in electric vehicle charging transactions during the first half of 2023, as officially communicated by the institution.
In addition to the rewards for EV charging station expenditures, the Customized Cash Rewards card will further expand its 3% cashback benefits to encompass online shopping along with costs associated with cable, streaming, internet, and phone plans.
Electric Vehicle Rewards: A New Norm?
Bank of America is not the pioneer in introducing tailored rewards for EV charging.
U.S. Bank, for instance, implemented a similar initiative in January 2022 by extending its existing gas rewards to cover EV purchases. Following suit, the Sam’s Club Mastercard introduced a 5% cashback incentive for EV acquisitions in May 2022.
Credit card issuers traditionally recalibrate and enhance their rewards programs to accommodate emerging spending trends. In recent years, this has led to the inclusion of categories like third-party food delivery and grocery services in their offerings to remain competitive.
Given the International Energy Agency’s projection that electric vehicles will constitute approximately 18% of total car sales in the current year, it’s foreseeable that more credit card companies will integrate EV charging stations as part of their reward structures. The first quarter of this year experienced the sale of over 2.3 million electric cars, reflecting a 25% increase compared to the corresponding period in the previous year.
With an expanding variety of electric vehicle options across diverse price points, the landscape is evolving rapidly. As of March 2023, a dozen automakers were collectively offering 40 distinct electric vehicle models for purchase in the United States. Individuals opting for mid-priced EVs and relying on public charging stations, as opposed to home charging, are incurring an average cost of $16.10 per 100 miles driven.