An Amazon credit card makes sense if you spend over $500 a year on Amazon and pay your full balance every month
Amazon offers two credit cards through Chase: the Amazon Prime Rewards Visa Signature Card (for Prime members) and the Amazon Rewards Visa Card (for non-members). The Prime version gives you 5% back on Amazon purchases, 2% at gas stations and restaurants, and 1% everywhere else. The non-Prime version gives 3% on Amazon and 1% elsewhere. Neither card has an annual fee.
The real question is not whether the rewards are real — they are — but whether you will actually come out ahead after accounting for how credit cards change your spending and what happens if you carry a balance. Most people who benefit from this card are already Prime members who shop on Amazon regularly and never pay interest.
Key Takeaways
- The 5% Amazon reward only applies if you are a Prime member; without Prime, you get 3%, which is less competitive than other cards.
- You break even on rewards only if you pay the full balance every month — one month of interest charges will wipe out months of rewards.
- The card's rewards are strongest on Amazon purchases; the 2% restaurant and gas rewards are matched or beaten by cards like the Chase Freedom Unlimited.
- If you do not currently have a credit card, opening one primarily for rewards can lead to overspending and debt before you see any benefit.
- Existing cardholders with good payment habits and regular Amazon spending are the most likely to come out ahead.
How the rewards actually work and what they are worth
The Amazon Prime Rewards card pays 5% back on Amazon.com and Amazon Fresh purchases, 2% at gas stations and restaurants, and 1% on everything else. That 5% sounds large until you do the math. If you spend $1,000 a year on Amazon — a reasonable amount for a regular shopper — you earn $50 in rewards. That is real money, but it is also the difference between a $20 coffee maker and a $19.50 one.
The 2% on gas and restaurants is where people often think they are getting more than they are. A card like the Chase Freedom Unlimited gives 1.5% back on everything with no annual fee and no Prime requirement. If you spend $500 a month on gas and restaurants combined, the Amazon card gives you $10 per month; the Freedom Unlimited gives you $7.50. That $2.50 difference per month is real, but it is also small enough that one bad spending decision wipes it out.
The 1% catch-all category is the weakest part of the card. Most competing cards offer 1.5% to 2% on all purchases, so you are actually losing money on non-Amazon, non-restaurant, non-gas spending compared to those alternatives.
The interest trap: how one month of debt erases months of rewards
This is the part that matters most and the part most people skip over. If you carry a balance on this card for even one month, the interest you pay will exceed the rewards you earned. The Amazon Prime Rewards card's APR (annual percentage rate) varies by creditworthiness but typically ranges from 18% to 24%. That means if you carry a $1,000 balance for one month, you will pay roughly $15 to $20 in interest.
If you earned $50 in rewards over the year, one month of carrying a $1,000 balance has already cost you 30% to 40% of your annual rewards. Two months of the same balance and you are in the red. This is why the card only makes financial sense if you have the discipline and cash flow to pay the full statement balance every single month, no exceptions.
If you are currently paying off debt or living paycheck to paycheck, opening a rewards card is not a path to saving money — it is a path to paying more. The rewards are designed to feel like information programs, but they only are free if you would have spent that money anyway and paid no interest.
Comparing the Amazon card to other options
If you are a Prime member who spends heavily on Amazon, the 5% reward is genuinely hard to beat. No other major card offers that rate on Amazon purchases. But if you are not a Prime member, the 3% Amazon reward is weaker than what you can get elsewhere. The Discover it Cash Back card, for example, offers 5% back on rotating categories (which sometimes include online shopping) and 1% on everything else, with no annual fee.
For gas and restaurant spending, the Amazon card's 2% is middle-of-the-road. The Chase Freedom Flex offers 3% on dining and gas for the first year, then 1% after. The Capital One SavorOne offers 3% on dining and entertainment with no annual fee. If restaurants and gas are your main spending categories, one of those cards will likely give you more back.
The real advantage of the Amazon card is not that it is the best at any one category — it is that it combines decent rewards across multiple categories (Amazon, gas, restaurants) into one card. If you split your spending across all three, you come out ahead of a card that is excellent at one thing and mediocre at others. But if your spending is concentrated in one area, a specialist card usually wins.
When the Amazon card makes sense and when it does not
The card makes sense if: You are already a Prime member. You spend at least $500 a year on Amazon (roughly $40 per month). You pay your full balance every month without fail. You have an existing credit card and a track record of on-time payments. You are not opening this card because you think rewards are information programs.
The card does not make sense if: You are not a Prime member (the 3% reward is not competitive). You carry a balance on any credit card. You are opening your first credit card. You think the rewards will offset overspending. Your main spending is in one category where another card offers more (like 3% dining cards if you eat out constantly).
If you are on the fence, the safest move is to not open it. A rewards card is a tool for people who already have good spending and payment habits. It is not a tool to build those habits with.
The hidden cost: how rewards cards change your spending
Research on rewards cards consistently shows that people spend more when they use them, even when they know intellectually that the rewards do not cover the extra spending. The psychological effect is real: the card feels like it is paying you to shop, so you shop more. You buy things on Amazon you would not have bought otherwise because you are getting 5% back. You eat out instead of cooking at home because you are getting 2% back.
If you spend an extra $100 per month because of the card, that is an extra $1,200 per year. Even at 5% rewards, you are only earning $60 back. You are down $1,140. This is why the card only works for people who have already decided what they are going to spend and are straightforward choosing which card to use for that spending.
Frequently Asked Questions
Do I need to be a Prime member to get the Amazon credit card?
No. Amazon offers a non-Prime version that gives 3% back on Amazon purchases and 1% elsewhere. However, the Prime version's 5% reward is significantly better, so if you are considering this card, Prime membership usually makes the math work better.
What happens to my rewards if I close the card?
Your rewards do not expire just because you close the card. You can use any rewards you have accumulated before or after closing. However, you will not earn new rewards once the account is closed.
Can I use this card to build credit if I have no credit history?
Yes, but a rewards card is not the best first card for someone building credit. A secured card (where you put down a cash deposit) or a basic card with no annual fee is usually a better starting point. Once you have established a payment history, you can move to a rewards card and actually benefit from the rewards instead of just paying interest.
Is the 5% Amazon reward really worth opening a new credit card?
Only if you already spend $500+ per year on Amazon and pay your balance in full every month. If you are opening the card specifically to earn rewards on spending you would not otherwise do, the interest and overspending will cost you far more than the rewards are worth.
What if I want rewards but do not want to risk overspending?
Set a monthly budget for Amazon spending before you open the card, and treat the rewards as a bonus on spending you have already planned. Some people also set up automatic payments to pay the card off in full on a specific day each month, which removes the temptation to carry a balance.