Cardless Closing Sports Credit Cards

Just a few short years ago, a brand new player entered the arena of rewards credit cards. Promising to be “different” and offer unique products, this brand immediately drew a cult following. Do you immediately think of Bilt Rewards? Same time frame, for sure, but a different company. We're talking about Cardless, which launched a handful of unique credit cards in the midst of the COVID pandemic. Unfortunately, early applicants were hit hard this week, as an email went out stating Cardless is closing sports credit cards. What are the implications and what does it mean longterm? We break it down below.

What is Cardless?

Before we can break down what Cardless closing sports credit cards really means, we must draw a bigger picture. Cardless is a credit card issuer that partners with brands to offer unique co-branded credit cards. During COVID, Cardless launched various co-branded cards with sports teams. These teams included:

• Boston Celtics
• Cleveland Cavaliers
• Liverpool Football Club
• Manchester United Football Club
• Miami Marlins
• New Orleans Pelicans

Due to the offerings on these cards, Cardless developed a cult following fairly quickly. Most of the cards offered $300 signup bonuses, no annual fees, and great bonus categories. For example, the New Orleans Pelicans card originally had unlimited 4% cash back on dining and gas stations, the Boston Celtics card had 7% cash back on ride shares and streaming services, and much more. For the right person, these cards were extremely lucrative for no annual fee.

A Season of Change

Even before this shocking announcement that Cardless is closing sports credit cards, we saw signs of turmoil and, most likely, a lack of profitability. Shortly after launching the above sports credit cards, all of those cards were suddenly unavailable for new applications. Even worse, it became obvious that Cardless had implemented the most draconian credit card rules of any bank: you are limited to one Cardless card for life. Lastly, even though Cardless originally promised that these cards would not report to personal credit reports, and affect 5/24, they did report and did count.

Once the Cardless sports cards were no longer available to new applications, we saw a shift in the products highlighted by Cardless. Instead of sports teams, we saw Cardless partner with various airlines. The new card offerings include:

• avianca lifemiles
• LATAM Airlines
• Qatar Airways

While these are solid products, they are much more in line with traditional credit cards, rather than unique card offerings with unheard of perks.

Canceling the Season

In a move as unexpected as a Randy Johnson fastball against a defenseless mourning dove, Cardless is closing all sports credit cards. We have confirmed cardholders of both the New Orleans Pelicans and Cleveland Cavaliers cards received emails that announcing immediate closure of these card products. While this move is not surprising, given the mindset shift of the company and the long-term profitability already in question, this is extremely frustrating.

Time to Test Free Agency?

The biggest negative to Cardless closing sports credit cards is Cardless' own rules. With a one card per lifetime rule, any Cardless cardholder that suddenly had their sports team credit card closed is now blocked from opening any other Cardless card to replace it.

We've written before that this Cardless 1-card rule makes absolutely no sense. It seems illogical that new partners would even co-sign a new product knowing that all current Cardless customers are blocked from obtaining a new product. Think about it: what company wants to partner with another company that has no viable customer base? This is the most onerous credit card application rule in the business and also the most non-sensical, but I digress.

Perhaps the most frustrating part about this is Cardless understands the major predicament for its prior customers, but currently does not have the IT capabilty to do anything about it. From Cardless:

“We don't yet support opening a second card with Cardless, but are actively working to support this functionality. We will be sure to reach out as soon as we can to support opening a new card with us.”

While it's hard for everyone to agree on anything anymore, I think we can all agree that if a company limits you to 1 card for life, and unilaterally decides to close the product that many of its customers chose as their 1 card, the functionality to replace the closed card should be in place BEFORE the cards were closed.

Cardless Closing Sports Credit Cards: ToP Thoughts

It's never fun to involuntarily lose a credit card, regardless of the reason. But Cardless closing sports credit cards hurts even more, since the Cardless 1-card rule means, at least for now, that prior Cardless customers cannot open a new Cardless card. While this lack of loyalty by Cardless will probably not hurt them (here's looking at you, Southwest Airlines), it certainly leaves a bad taste in our mouth. The company still has several good card products, but what is their future? The 1-card rule needs to go, especially if the company decides to discontinue large segments of its existing credit card portfolio. Let's hope this never happens again and Cardless finds new ways to remain relevant and rebuild loyalty.

We're you affected by these card closures? Come over to our Facebook group and let us know.