The Amazon Credit Card Earns Rewards on Amazon Purchases and Everyday Spending

The Amazon credit card comes in two versions: the Amazon Prime Rewards Visa Signature Card and the Amazon Rewards Visa Signature Card. Both cards earn cash back on purchases, but the rewards structure and benefits differ based on which card you hold and whether you have an active Prime membership.

The Prime version offers 5% cash back on Amazon.com purchases and Whole Foods Market transactions when you are a Prime member, 2% cash back at gas stations and restaurants, and 1% cash back on all other purchases. The standard Amazon Rewards card earns 3% cash back on Amazon.com purchases, 2% at gas stations and restaurants, and 1% on everything else. Both cards charge no annual fee.

Cash back appears as a statement credit on your account or can be redeemed toward an Amazon.com purchase. You do not receive cash back as a separate payment; it reduces what you owe or can be applied to future Amazon transactions.

Key Takeaways

  • The Amazon Prime Rewards card earns 5% cash back on Amazon and Whole Foods purchases if you hold an active Prime membership, while the standard card earns 3% on Amazon purchases only.
  • Cash back is credited to your account as a statement credit or Amazon.com balance, not paid out as cash to your bank account.
  • Interest accrues on your balance at the card's annual percentage rate (APR) if you do not pay in full by the due date, and cash back does not reduce the amount you owe in interest.
  • Your credit limit, interest rate, and rewards rate are set when the card is approved and may change based on your payment history and credit profile.
  • Closing the card does not erase your rewards balance, but future purchases will not earn cash back once the account is closed.

How the Rewards Rate Changes Based on Your Prime Status

If you hold the Amazon Prime Rewards card, your 5% cash back rate on Amazon.com and Whole Foods purchases is only active while your Prime membership is current. When your Prime membership expires or you cancel it, the card automatically drops to the standard 3% cash back rate on Amazon purchases.

You do not need to contact the card issuer to make this change; it happens automatically when your Prime status ends. If you later renew your Prime membership, the 5% rate returns on your next purchase. This means the card's value depends directly on maintaining your Prime subscription.

The 2% cash back on gas stations and restaurants and 1% on all other purchases remains the same regardless of Prime status on both card versions.

How Interest Works When You Carry a Balance

The Amazon credit card charges interest on any balance you do not pay in full by your statement due date. The APR varies based on your creditworthiness and is disclosed in your card agreement when you are approved. This rate applies to new purchases and any existing balance you carry forward.

Interest accrues daily on your outstanding balance. If your statement balance is $1,000 and your APR is 18%, the card issuer calculates daily interest by dividing 18% by 365 days, then multiplying that daily rate by your balance each day. This daily interest is added to your balance, and you pay interest on the interest if you do not pay the full amount the following month.

Cash back rewards do not reduce the amount of interest you owe. If you earn $50 in cash back but carry a $1,000 balance, you still pay interest on the full $1,000. The cash back is a separate credit that appears on your statement.

What Happens When You Make a Payment

When you make a payment to your Amazon credit card account, the issuer applies it first to interest and fees, then to principal (the amount you originally borrowed). This means if you owe $1,000 in principal plus $150 in accrued interest, a $500 payment covers the $150 in interest first, leaving $350 to reduce your principal balance to $650.

Payments are due by the statement due date shown on your bill. If you pay after that date, the issuer reports the late payment to credit bureaus and may charge a late fee (typically $25 to $40 for the first late payment). Paying late also triggers a higher penalty APR on future purchases, which can last six months or longer depending on your card agreement.

The minimum payment is calculated as a percentage of your balance plus interest and fees, usually around 1% to 3% of what you owe. Paying only the minimum extends the time you carry a balance and increases the total interest you pay.

How Your Credit Limit Is Set and Can Change

When your Amazon credit card application is approved, the issuer assigns you a credit limit based on your credit score, income, and payment history. This is the maximum amount you can charge to the card. The limit appears in your online account and on your statement.

Your credit limit can increase or decrease over time. The issuer may raise your limit automatically if you make on-time payments and keep your balance low relative to your limit. You can also request a credit limit increase through your online account or by calling the card issuer's customer service number on the back of your card.

If you miss payments or carry a high balance relative to your limit, the issuer may lower your credit limit without asking. A lower limit reduces the amount you can spend but does not forgive any balance you already owe.

Closing Your Amazon Credit Card Account

You can close your Amazon credit card at any time by calling the customer service number on the back of your card or through your online account. Closing the account stops you from making new purchases, but you remain responsible for paying any balance you have already charged.

Any cash back rewards you have earned remain in your account and can still be redeemed as a statement credit or Amazon.com balance after the account is closed. The issuer does not forfeit your rewards when you close the card.

Closing the card may lower your credit score in the short term because it reduces your total available credit and may increase your credit utilization ratio (the percentage of your total credit limits that you are using). If you want to keep the account open but stop using it, you can simply leave it inactive; there is no annual fee, so it costs nothing to maintain.

How Fees Work on the Amazon Credit Card

The Amazon credit card charges no annual fee, no foreign transaction fees, and no balance transfer fees. This makes it less expensive than many other rewards cards that charge $95 to $550 per year.

You may be charged a late fee if you miss your payment due date. The fee is typically $25 for the first late payment in a six-month period and up to $40 for subsequent late payments, though this varies by state. Late fees are added to your balance and accrue interest like any other charge.

If you use the card for a cash advance (withdrawing cash from an ATM), you will be charged a cash advance fee (usually 3% to 5% of the amount withdrawn) plus a higher APR that starts accruing immediately with no grace period. Cash advances are expensive and should be avoided.

Frequently Asked Questions

Can I use my Amazon credit card outside of Amazon?

Yes. The card works anywhere Visa is accepted. You earn 2% cash back at gas stations and restaurants and 1% on all other purchases outside Amazon. The higher rewards rates (5% or 3%) only apply to Amazon.com and Whole Foods purchases.

What happens to my cash back if I close the card?

Your cash back balance stays in your account and can be redeemed as a statement credit or applied to an Amazon.com purchase even after the card is closed. The issuer does not take back rewards you have already earned.

Does the card have a grace period before interest starts?

Yes. If you pay your full statement balance by the due date, no interest is charged on purchases made during that billing cycle. Interest only starts if you carry a balance past the due date.

Can I get my APR lowered after I am approved?

You can contact the issuer and ask for a lower rate, but they are not required to grant it. A lower rate is more likely if you have made consistent on-time payments and your credit score has improved since you opened the account.

What is the difference between the Prime and standard Amazon credit card?

The Prime card earns 5% cash back on Amazon and Whole Foods when you have an active Prime membership; the standard card earns 3% on Amazon only. Both earn 2% at gas stations and restaurants and 1% elsewhere. Choose the Prime card only if you maintain an active Prime subscription.