Bread Financial Review – Is FinTech Better for Your Finances?
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When you stop to think about the pillar of your personal finances, you will likely consider checking and savings accounts, credit cards, and loan management to be among them, and perhaps investment accounts. Bread Financial is one of numerous solutions available for personal finance, but it only offers a select number of products under a few of these pillars. Is it right for your finances? Keep reading our Bread Financial review to find out more.
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What is Bread Financial?
Bread Financial is a fintech services company headquartered in Columbus, Ohio, which means it’s a financial company powered by technology. While it’s part of a long history of over 35 years in operation under various names, it was established as a spin-off from Alliance Data in 2022. It offers a wide range of financial solutions serving both consumers and businesses, focused on credit cards, savings, and loans. It’s mission is focused on offering financial empowerment by creating simple, smart financial solutions.
Bread Financial has built a reputation for its credit card programs, including co-branded credit cards and private label options. For example, you can find a Bread Financial credit card co-branded with the NFL or Ulta Beauty Store, where cardholders earn specific rewards tailored to a particular retailer.
- Highly competitive rates
- FDIC insured
- No monthly or hidden fees
What products does Bread Financial offer?
Bread Financial isn’t a bank or a credit union, and its product lineup reflects a break from the traditional offerings. While it also offers commercial products, the personal ones include:
Credit card accounts
Bread Financial offers a variety of credit card accounts, including co-branded credit cards and private label options and each one offers a specific benefit for the cardholder, such as rewards, cashback, or low-interest rates.
The Bread Cashback American Express credit card is one of their flagship products, where cardholders earn 2% unlimited cash back on all purchases and without any annual fee.
Bread Pay
Bread Pay is a flexible buy now, pay later (BNPL) option that offers the flexibility of paying for purchases over time and without high-interest fees. Bread Pay integrates with online retail platforms, so you can choose installment payment options at checkout and you get a real-time decision on whether or not you’re approved.
Bread Savings
Bread Savings is Bread Financial’s online savings account offering and includes a high-yield savings account option, certificate of deposit (CD), and IRAs. The savings accounts and CDs offer highly competitive interest rates, interest that compounds daily, and the savings account has no monthly maintenance fees or transaction fees.
Additionally, the account center has useful savings tools, such as a tracker, so you can track your savings progress and view key metrics. It also includes features such as unlimited mobile deposits each month and free incoming wire transfers.
Bread Loans
Bread also offers a personal loan option in its consumer-focused lineup, which is currently available by invitation only. If selected to apply, Bread’s personal loans can offer up to $35,000 for borrowing and can use it for consolidating up to five credit card balances (or other approved uses). Applicants can select from terms of 24, 36, 48, or 60 month repayment terms, and it also offers more competitive interest rates ranging from 6.99% to 17.49% APR.
Who is Bread Financial best for?
Tech-savvy consumers
If you’re someone who appreciates tech-forward solutions, then you’ll likely find Bread Financial’s products appealing. It includes a user-friendly online platform, with features like the instant buy now, pay later decision at checkout and personalized savings dashboard.
Those looking for flexible payment options
If you’re looking for flexible payment options, Bread Pay offers a buy now, pay later solution, so you can spread out payments over time without incurring significant interest costs. Plus, you can apply and get a decision while standing in the checkout line.
Those who want a competitive interest rate for savings
If you’re focused on growing your savings, then Bread Savings is definitely worth consideration. It offers competitive interest rates and a user-friendly online platform, so you can build a financial cushion and earn high interest rates for either savings accounts or certificates of deposit.
- Highly competitive rates
- FDIC insured
- No monthly or hidden fees
Who shouldn't use Bread Financial?
Those with credit challenges
Bread Financial’s credit card programs are typically geared toward applicants with good to excellent credit. If you have poor or fair credit, then you might find it challenging to qualify for Bread Financial’s credit card accounts.
Those who prefer traditional banking
If you’re someone who prefers in-person banking services then might not find Bread Financial’s online-focused approach to be ideal. While Bread Financial’s tech-forward solutions are great for more tech-savvy, digital natives, if you prefer face-to-face interactions and traditional banking services then you may find a conventional bank better suits your needs.
Those who need a checking account
While Bread Financial has plenty of loan and savings accounts to choose from, it lacks a checking account option. If you’re someone who likes having all their personal finance pillars (checking, savings, loans, credit cards, and investments) under one umbrella, then this could present an issue for you.
Pros and cons of Bread Financial
Pros
- Product offerings focused on savings, lending, and credit card solutions
- Competitive rewards and interest rates with its credit card portfolio
- Tech-forward solutions, which can make it even easier for everyday use
- Savings options offer high interest rates and ultra-competitive offers
Cons
- It has a limited physical presence since it’s an online-only option, which means you can’t access in-person service
- Bread Financial’s credit card accounts are generally targeted towards those with good to excellent credit, which can limit who has access to its offerings
- It doesn’t offer a checking account and its focus remains on credit card programs and savings accounts
Bread Financial vs. competitors
American Express
Bread Financial and American Express offer different experiences for their customers. For starters, American Express has a wider portfolio of products to choose from. For starters, American Express offers a much deeper selection of credit cards. You can choose from cash back, rewards-focused, travel, or business offerings and each category has several options to choose from. However, American Express typically offers more premium cards, which means it may have even more stringent credit requirements versus Bread Financial.
Additionally, American Express offers a full lineup of banking products, including a checking account option. The Rewards Checking option offers 1% APY, no monthly fees, debit card rewards, and many American Express benefits. While Amex does offer a high-yield savings account option, it currently commands a 4.25% APY, which is not as competitive as Bread Financial’s 5.10% APY.
Like Bread Financial, American Express offers an IRA savings plan. You can choose from two types: a high-yield savings IRA or an IRA CD. This mirrors what Bread Financial offers, however, Bread Financial interest rates are much more competitive for these products, compared to American Express, though American Express offers a greater variety of IRA CD term lengths.
Citi
Citibank is another major name in the financial world, but unlike Bread Financial or American Express, it has physical branches you can visit in-person for guidance or account management, not to mention its ATM network of over 65,000 ATMs.
Citibank has one of the most extensive credit card offerings available, including a secured credit card offering where you can establish or rebuild your credit. Whether you’re looking for a cashback, rewards, travel, or retail credit card, chances are Citibank has a choice for you.
Like Bread Financial, Citibank has a high-yield savings account available, but its current 4.45% APY still doesn’t beat Bread Financial’s 5.15% APY. Citibank also charges a $4.50 monthly fee, unless you meet certain requirements.
One of Citibank’s standout features is its investment offerings. You can open up your own self-directed, commission-free trading account, so you can truly create a full portfolio of checking, savings, retirement, and investment accounts.
FAQs
How can I apply for a Bread Financial credit card?
If you decide you’d like to apply for a Bread Financial credit card, you can either visit the Bread Financial website or the specific retailer's website using a Bread Financial partnership and offers a co-branded or private label credit card. The application process is straightforward and typically requires your personal information, including your Social Security number, income details, and contact information, plus authorizing a credit check.
What is the Bread Savings account and how do I open one?
The Bread Savings account is Bread Financial’s high-yield savings account option, which offers an extremely competitive APY (currently 5.15%) and user-friendly online account management tools. To apply for it and open an account, simply go to the Bread Financial website and follow the prompts for getting started.
Can I use Bread Pay for in-store purchases, or is it only available online?
Bread Pay is available for both online and in-store purchases, however, you’ll have to confirm if the retailer you’re working with accepts Bread Pay. Bread Financial offers a decision almost instantly, so you can complete the process while in the checkout line. You can receive a virtual card once approved, which means you can use it or the QR code for payment when in-store.
- Highly competitive rates
- FDIC insured
- No monthly or hidden fees
The bottom line
Bread Financial sets itself apart by offering user-friendly, tech-forward features, so you can quickly access your account information, receive quick approvals, and open new accounts quickly. While it offers a decent lineup of credit cards, savings, and loan options, it doesn’t have the full portfolio of products so you can have all of your banking and investment options in one location. However, the competitive interest rates and ease-of-use may be more than enough to convince you to use Bread Financial.
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