Banana Republic credit card review: Is it on trend for your wallet?

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In a Nutshell

With easy-to-redeem shopping rewards, a Banana Republic credit card could be a good choice for loyal shoppers who already buy most of their clothes from Banana Republic. But a high purchase APR and confusing application process make it a tough recommendation for anyone who might carry a balance.

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Pros Cons
Rewards system is simple and easy to use Rewards can be redeemed only at certain Gap Inc. stores like Banana Republic and Old Navy
Banana Republic Luxe status offers dedicated shoppers perks like free shipping High purchase APR makes this card a risky choice for people who carry a balance
No annual fee Confusing application process means you might end up with a card that can only be used at Gap Inc. stores

What you need to know about Banana Republic credit cards

The application process is confusing

Even though the application itself is straightforward — you fill it out and then wait for a decision — the process is a little confusing.

In fact, your application covers more than just one credit card. When you apply for a Banana Republic card, you could be considered for two different credit cards: the Banana Republic Credit Card and the Banana Republic Visa Card.

We reached out to a representative from Synchrony Bank, which issues the Banana Republic cards. They told us that when you apply, Synchrony first considers you for the Banana Republic Visa Card. And if you don’t qualify for that card, you’re then considered for the Banana Republic Credit Card.

The Banana Republic Credit Card can be used only at Gap Inc. stores, which include Banana Republic, Gap, Old Navy and Athleta. But you can use the Banana Republic Visa Card anywhere that accepts Visa.

In other words, you may end up with a credit card that you can use only at very specific stores. This isn’t necessarily a bad thing, but it’s good to understand the difference before you apply.

If you do receive the Banana Republic Credit Card, be sure to use it responsibly. The card issuer may report information on card use to the three major consumer credit bureaus, so doing just that can help you build credit.

What you need to know about the main 3 credit bureaus

It’s simple to earn and use the rewards

The Banana Republic rewards system is straightforward and simple. You’ll earn five points for every $1 spent at certain Gap Inc. stores, which include in-store and online purchases from Banana Republic, Old Navy, Gap and Athleta. When you use the Banana Republic Visa Credit Card at other stores, you’ll earn one point for every $1 spent.

For every 500 points you earn, you’ll receive a $5 reward, which can be redeemed at certain Gap Inc. stores.

There’s no limit to how many points you can earn, but the largest amount of rewards issued in a single billing cycle is $250.

But rewards aren’t worth much unless you already shop at Gap Inc. stores

Even though the rewards are easy to understand, the truth is that you need to spend a lot of money to earn small rewards.

For example, you typically need to spend at least $100 at Gap Inc. stores to earn one $5 reward. If you use the Banana Republic Visa Credit Card when shopping at stores outside the Gap Inc. brand, you’d need to spend $500 to earn a $5 reward.

With a Banana Republic shirt costing upward of $60 at full retail, you may not need to buy dozens of items to earn your rewards. But one $5 reward also won’t drastically reduce the cost of any one item.

We don’t recommend changing your shopping habits just to earn more rewards, so don’t let the potential for savings push you toward making more purchases. These rewards are only worth it if you’d spend the money regardless of whether you had the credit card.

The APR makes it a risky choice

Store credit cards tend to feature high interest rates, and the Banana Republic Credit Card is no exception. With a variable APR of 27.24% on purchases, this card can quickly become expensive if you carry a balance.

Compared with a national average of 14.73% APR for credit cards as of November 2018 (per the Federal Reserve), the APR for this card is quite high. This might not seem like a big deal, but if you carry a balance it could cost you hundreds or thousands of extra dollars.

Plus, the late-payment fees can go up to $38, which is yet another cost for people who may not make their minimum payments on time.

Be honest with yourself about whether you tend to carry a monthly balance. If you do, the perks are not worth the costs for this card.

Luxe status offers more perks

If you earn 5,000 points in a calendar year (excluding bonus points and merchandise returns), you’ll earn Banana Republic Luxe status, which offers extra perks.

  • Luxe status comes with free three- to five-day day shipping on eligible orders and a quarterly point bonus of 20% of points earned (so if you’ve earned 500 points throughout the quarter, you’ll get an extra 100 points added to your reward balance).
  • Luxe members get free standard alterations on clothing items purchased from Banana Republic.

Keep in mind that these extra perks may not be worth the extra spending required to earn them. For instance, if you spend roughly $800 at Banana Republic every year, these perks might not be enough to justify the extra $200 in spending to reach Luxe status. But if you already spend $1,000 at Banana Republic annually, they’re a nice benefit as you look to add to your wardrobe. 

Understanding your points and redemption options

Redeeming points is simple, and there aren’t many restrictions about when you can redeem them. But it’s important to note that rewards can be used only at certain Gap Inc. stores. Here’s what you need to know.

  • You can redeem up to three reward certificates in person and up to five reward certificates online.
  • You can combine reward certificates with a promotion or sales to save even more money.
  • You must requalify for Luxe status (earn 5,000 points or more) each calendar year.

The other stores in the Gap Inc. brand — Old Navy, Gap and Athleta — also offer store-specific credit cards. The primary difference between these cards is the branding though, so don’t worry too much about whether you should apply for one or the other.

Who this card is good for

This card may work well for people who already do a lot of shopping at Banana Republic and other Gap Inc. stores. For example, if you regularly update your work clothes or are a young professional building your wardrobe for the office, then a Banana Republic credit card might be a useful option for you.

This is especially true if you plan to spend at least $1,000 at Banana Republic or other Gap Inc. stores in a calendar year, because you can earn Luxe status and unlock more benefits.

But this card may not be a good choice for people who don’t regularly shop at Gap Inc. stores. Because the rewards are specific to the stores, the perks aren’t worth it unless you know you’d spend the money at Banana Republic even without the credit card in your pocket.

Because of the high purchase APR and late fees, this card may not be a great choice for shoppers who might carry a balance. Your fees and interest payments could quickly outweigh any potential benefits.

Not sure this is the card for you? Consider these alternatives.

If you’re not sure whether this card is right for you and your shopping needs, one of these cards might be more your style.