Note: the CT Options Mastercard reward scheme has changed since this article was created and is now described in multipliers from a basic rate (eg: 2X or 10X depending on where you shop). However, it is no more transparent now than it was when I was forced to investigate what my earnings were (and finding out it was less than the staff were telling me). The content remains relevant from an customer relations and transparency point of view. The reward rate is not calculable from the information on Canadian Tire’s web site or the Options Mastercard site, and may still be subject to the rounding issues described below. See “Update 4” at the bottom for some information on the new programme.
Bottom Line Up Front
- Depending on the specifics of how you spend your rate can be much lower than the commonly stated 1% cash back (in Canadian Tire ‘money’).
- In my case the rate is closer to 0.86%.
- I have moved on to the President’s Choice Financial MasterCard and am much happier with their transparency.
- Based on what I learned when I cancelled my card (see the Aug 2012 update at the bottom of my post), Canadian Tire MasterCard is intentionally, unethically, misleading its customers to think they get a better rate of return than they really are.
One of our credit cards was recently automatically replaced with a new variant. On looking at its reward level I decided I wanted to compare to my Canadian Tire Options MasterCard. I recalled that the rate was 1%, but I wasn’t certain, so I opened up my most recent statement. I was quite surprised when I did the math and found only 0.86%. Given that we use only one credit card, and funnel most purchases through it, this is easily a $50/year difference in rewards.
When I first got the credit card, at least 10 years ago, I recall it being advertised at 1% (for purchases outside of Canadian Tire). I can’t swear by it, but the 1% was sure stuck in my head. Perhaps the rate had changed? I went to the web site to check and see the following:
Well that’s less than helpful. Interestingly, the other credit cards on offer from the same (Gas Advantage, Cash Advantage) site detail their rewards pretty well. But there is a footnote – surely that will clear it up?
OK, not so much. Neither does the legal text, which only talks about the generalities of reward programs. But the footnote had a link to the Canadian Tire ‘Money’ Rewards Program Page. Sadly, this doesn’t help either, and only starts making me a little angry:
So, they reserve the right to change the program at any time, without a requirement of informing the program members, and even if someone wants to learn how they earn rewards, they have to call to determine their benefits.
I now pick up the phone and speak to a very nice and eager-to-help man. At first he tells me the rate of cash back, in general, on non-Canadian Tire purchases, is 1%. When I explain my issue to him, he further clarifies that sometimes the exact amount can differ, as purchases are rounded both up and down to the nearest dollar, so the exact amount of cash back will not be equal to 1%, but should be close. When I tell him the large difference I’ve encountered, he digs deeper by examining my specific purchases and we find:
- Purchases are always rounded down, never up.
- Purchases seem to be rounded down in different increments depending on amount of money being spent.
For example, we looked at the following purchases and payback:
- $1.84 resulted in 1 cent reward (rounded down to $1)
- $73.33 was rounded down to $70 for reward calculation.
- $244.61 resulted in a $2 reward (rounded down to $200)
- $278.25 resulted in a $2.5 reward (rounded down to $250)
In general, it looked to me like:
- in the <$10 range purchases were truncated to the nearest dollar
- from $10 to <$100 range purchases were truncated to the nearest ten dollars
- greater than $100 purchases were truncated to the nearest $50
I told him that I was pretty upset with this arrangement and that I would like someone from management to call me. (I will just point out here that the guy helping me was great and spent a lot of time looking this info up with me). I didn’t hear anything for a week, and just when I was getting ready to call back, a physical paper letter arrived in the mail (click either to enlarge).
The start of the letter explains how money is earned when shopping at Canadian Tire specifically (not really important in this comparison as I don’t spend enough money there to make a difference). After telling me that the reward program on out-of-store purchases is “one of the most generous customer reward programs on the market” a set of examples follow. While I’m not stating it the same way they do, in essence:
- $278.25 is rounded down to $250
- $244.61 is rounded down to $200
They then generically explain how purchases are handled:
- Outside merchant purchase <$1 —- 1% rounded down to nearest 0.10
- Outside merchant purchase >$1 —- 1% rounded down to nearest 0.50
- [The remaining 3 calculations are for Canadian Tire stores/services/fuel specifically]
The calculations are generally what I saw but don’t explain the $73.33 purchase. They’re obviously missing something because a purchase of $49 would, from the math and ranges they provided, be multiplied by 1% and rounded down to the nearest 0.50 – which would be zero. So some sort of bracket is missing in their explanation and is likely a rounding down to the nearest 0.10 for purchases greater than $1 but less than $100. (This is even more likely given that they have roundings of 0.10 for in-Canadian-Tire purchases). If this is correct it is quite astounding – from the point of view of making small purchases in the $50 to $200 range, the more you spend, the less of a reward you get, as a percentage, in general! No wonder they don’t list the details online…
The last part of the letter is in regards to the benefits we receive for being “elite” members which increases our rewards by 20% but doesn’t affect the base rate – by which I mean, my base rewards would be exactly the same no matter if I was an elite member or not. With the elite rewards added in, we earn close to the original 1%.
Canadian Tire Options MasterCard is not the deal it used to purport to be, not the deal people think they are getting, and not even the deal its customer support people understand it to be. I am now investigating other rewards programs (almost all of which obfuscate the rate of rewards in one way or another but at least they give you the details online) and will likely move to a card that doesn’t have such a blatant unnecessary and confusing formula as to how rewards are generated. Come on Options MasterCard – if you only want to pay out at 0.86% then just make that the rate. Stop taking advantage of the laziness of your consumers!
Update: Now including a link to a web search I had forgotten to include in this write up, seems to me to be shilling for the card, wherein the rate is given as 1% without any nuance. Number 5 on Google search results. That is the only information I can find on the rate being paid out.
Update 2 (15 Dec 2011): this article has recently captured some attention; it’s nice to see there are some other folks out there willing to look at their monthly statement. No, I haven’t switched cards yet – but only due to laziness. I am keeping my eyes open for a new contender.
Update 3 (2 Aug 2012): Wow. Having switched to a new card a couple of months ago, I finally bit the bullet and cancelled my Canadian Tire MasterCard card today. I wish I had recorded the call. I was immediately transferred to an account specialist. She asked why I wanted to close my account. I told her that I had simply done the math and wasn’t getting the rate of return I had expected. She told me (and I have to paraphrase here): “With our card you get 1% everywhere you shop”.
I found that really funny as clearly, you don’t, and I would have thought the specialist would know that. I decided to clear it up for her and told her that this was in fact the exact reason I was cancelling – that the rate is actually much less because the amounts rewarded are rounded down, and it results in around 0.86% for my purchasing profile. She then told me: “Well yes, we round down to the nearest $10.”
So holy crap, she knew this, but told me the 1% anyway. But there’s more! I then went on to say that yes, you round down to the nearest $10, but that there are different brackets of rounding according to a letter I received, and that the rounding is as much as the nearest $50. She then said: “Yes, we round down to the nearest $50 when you spend above $100.”
So she knew! The staff – their “specialists” – know this, even as they make a blanket statement of 1%. This is no longer an artifact of a confusing system with ill-trained staff. This is a deliberately misleading attempt to fool consumers into thinking they’re getting a better deal than they really are. It’s crossed from incompetence into the realm of the unethical. I’m very disappointed in Canadian Tire. And looking at your comments below, I wasn’t the only one who didn’t know how the card works.
Update 4 (1 Dec 2014): As noted in a comment from today, the program has changed. Visting the Options Mastercard site I see the following:
It is obvious that they’re going for a new approach. I haven’t been to Canadian Tire for a while, but it seems they have a collector card for e-money now that will work irrespective of using their credit card. So, I think what is being shown here is that you can earn more money than the normal collector rate by using your CT Options Mastercard at Canadian Tire itself, along with their subsidiaries. However, our line of particular interest is this:
“Collect 2X e-Canadian Tire ‘Money’ everywhere else you shop†”
OK, got it. 2X. Twice. Double. That’s a lot. Not 10X good, but I can shop at any merchant and still get the 2X rate. However… right now I get no e-Canadian Tire ‘Money’ when I shop elsewhere…so 2X still doesn’t feel like much. But the disclaimer symbol (†)is here to help… let’s go see what it has to say.:
† In the form of e-Canadian Tire ‘Money. Terms and conditions apply to collecting and redeeming. Visit canadiantire.ca or ctfs.com/ctm for more information. Canadian Tire Options MasterCard cardmembers paying with their Options MasterCard collect e-Canadian Tire ‘Money’ at a rate that is 10X the rate at which other members of the My Canadian Tire ‘Money’ program collect e-Canadian Tire ‘Money’ on purchases made by such other members at Canadian Tire stores (if those other members paid by cash, debit or a credit card not linked to this loyalty program). The offered rate is exclusive of any bonus or promotional offers or redemption transactions.
Uh oh. This is starting to sound familiar. Leaving aside the oversight that the paragraph is only talking about 10X rewards and not 2X rewards, it seems that the reward rate is defined by another reward rate that they’ve chosen to explain elsewhere. Maybe this can be cleared up with a visit to ctfs.com/ctm…
I would like to post all of the leagaleese I found there, but your eyes would glaze over and you might never reach the end of this entry. So let’s focus on this gem:
“The rate at which eCTM can be collected may vary from time to time and by location and is subject to change by Canadian Tire without notice.”
So whereas before we had a credit card reward program with an ill defined rate of return (that could change without notice) it seems Canadian Tire has now piggybacked its credit card program onto its e-Canadian Tire ‘Money’ program. But, somewhere along the way it changed the Canadian Tire ‘Money’ deal so that you don’t know what your rate of return is, and it can change any time without notice.
My best guess at this point is that if you knew the rate at which eCTM is being payed out that you could double that for shopping outside of Canadian Tire. But it isn’t explained on either of their web sites and I don’t feel sufficient self-loathing to call their customer service and inquire again.
I think it makes sense for Canadian Tire to express their card earnings as a multiplier of their basic rewards. I see how they have been forced to enter a digital rewards program for efficiency as well as to play in the customer shopping habits space (as all reward programmes do). And in so doing, it makes a lot of sense then to just express the Mastercard benefits as a multiplier of the normal benefits. What’s sad is that they seem to have really tinkered with their ‘Money’ reward payout scheme, making it difficult to understand, and then hidden it behind closed doors hoping no-one will ask.
In all fairness though – if you are a Canadian Tire Family junkie – shopping at SportChek, Mark’s, and Canadian Tire, this might be a good deal. But without knowing the base rate, you can’t be sure. And I suspect it will be next to impossible to find out how much you’re earning on purchases at other retailers. Until they publish a rate, use this card only in the CT Family, or just find another card with a published rate and focus your efforts there.