Is ‘The Smartest Credit Card Ever Made’ Actually That Smart?

Is ‘The Smartest Credit Card Ever Made’ Actually That Smart?

The much hyped X1 credit card, billed as “the smartest credit card ever made” is now finally available to the general public, but is it as innovative as its marketing suggests? Indeed, there are some unique perks, along with a good rewards rate — especially for a no-fee card — although the reward redemption options are more limited than what you see with other more traditional cards.

How does the X1 card work?

Backed by PayPal co-founder Max Levchin, the X1 has “smart” offerings you don’t see with traditional lenders. This includes the ability to automatically end free trials, cancel subscription payments in one click, and create one-time use virtual cards that offer enhanced privacy.

Most notably, the card’s credit limit and interest rates are based on “current and future income” instead of your credit score. As a result, the company says that credit limits are up to five times higher when compared to traditional cards; for this reason, the card is well-suited for borrowers who either have a bad credit score or a limited credit history.

Other features include:

  • No annual fee and no foreign transaction fees
  • Two points per dollar on every purchase
  • Three points per dollar for the year if you spend $US15,000 (A$19,908) or more that year
  • Four points per dollar for a month for every referral who signs up for the card
  • Variable interest rates that are relatively low, ranging from 12.75% to 19.75%
  • Visa Signature perks and benefits

Two points on every purchase is a competitive rate when you compare it to similar no-fee cards, but three points per dollar spend is really good if you normally spend $US15,000 (A$19,908) annually with your credit card. Combined with the extra credit limit and lack of fees, the X1 would be a solid everyday credit card.

The X1 rewards are a bit of trade-off, however

While the rewards multiplies compare well with similar no-fee cards, the reward redemptions are less robust than what you see with traditional lenders:

  • There is no welcome bonus or introductory APR offers — often a $US1,200 (A$1,593) value if you achieve certain spending goals (e.g., spending $US5,000 (A$6,636) in three months).
  • There are no discounted introductory APR offers, either (other cards often offer 0% for 12-18 months).
  • Points are redeemable only with 45 listed brands, which include Apple, Nike, Patagonia, Wayfair,, Vrbo, Airbnb, and some major airlines. You’d want to make sure the partnerships already align with your spending habits before committing to the card (you can also redeem points as a credit statement, but the rate is less favourable compared to redeeming rewards through X1’s partnerships).

Bottom line

The X1 is a good everyday card for people who have decent income but less-than-decent credit scores, especially if you spend enough to qualify for the three-points-per-dollar-spent perk. Other features, like automatic subscription cancellations and one-time use virtual cards, are pretty smart and seem like a step forward when it comes to credit card perks.

The reward redemptions are limited, though, so you’ll want to make sure the card’s partnerships line up with your current spending habits. Otherwise, it’s a solid option if you’re looking for a no-annual fee card.


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