Review Of New Gold-Backed Credit Card

The new planned credit card secured by gold has attracted the notice of CreditCardGuide.com. In a review penned by Eva Norlyk Smith, Ph.D., she basically gives the card a thumbs-down. Despite the exoticness of using gold as a backing for money, it's still a secured credit card. There's a planned annual fee of between $50 and $100. There's also a storage fee for the gold coins deposited as backing for the card, whose credit limit is set at 75% of the value of the gold coins. She mentions that the credit limit could be raised if the value of the gold coins rise - resets are planned for every 6-12 months - but doesn't mention if the credit limit will be cut if the gold value falls. A transactions fee kicks in if the holder wants to buy new gold coins so as to bump up the limit. (There may be a deregistration/delivery fee assessed on people who want [some of] their coins back.) The interest rate is planned to be from 8 to 13 percent; the card ain't a disguised debit card.

So is the Gold Bullion Card a good idea? For most people, no. A regular credit card or a regular secured credit card, which the Gold Bullion Card essentially is, both offer better value. However, for those holding gold coins, the Gold Bullion card could offer some benefits. When strapped for cash, many gold owners often struggle with the decision of whether or not to sell off coins. Because market prices could continue to rise, they might lose out on a future, better deal by selling their gold. With the Gold Bullion, gold owners can enjoy access to funds drawn on the value of their gold, while still maintaining the investment. And of course, for those believing the country is about to go to hell in a hand basket, the thought of having that gold-backed card in their wallet in times of crisis, will be well worth the fees.

At the end, she mentions that several major bullion coins are to be accepted as backing.


Although it does make for a step towards gold as money, it looks to my eyes like a vanity card. Secured credit cards are normally offered to people with spotty or bad credit histories, and this one's fees look pretty high. A vanity holder is most likely to pay for the privilege of saying, "See? Gold IS Money!" and using that credit card as proof.