Amway Global IBOs are Taken Advantage of by MBNA
Bank of America Offers a Bad Deal With PV/BV Instead of Cash
Nov 2, 2009
Amway Global's community of independent business owners (IBOs) are a group of hardworking networkers with high quality products sold at premium prices.
The professional backgrounds of these people vary from teachers, doctors and lawyers to factory workers and gas station attendants. As they learn to manage their networking businesses, they become accustomed to brand loyalty. For those in Amway, product brands such as XS Energy Drinks, Nutrilite, or Artistry will always be thought of as being better than Red Bull, Centrum, and Mary Kay.
IBOs purchase these products because they receive rebates on their purchases up to 25% while working to earn a substantial income from sales and purchases made within one's network, further enhancing brand loyalty.
This is the basis of the networking industry, and those in it feel that it works to everyone's advantage in the various networks unless the product or service is either inferior in quality, or the return cannot compete with those of a competitor. In the case of the Amway Global Visa card from Bank of America, it's the latter.
MBNA Offers IBOs Quality Service With Inferior Rewards
Bank of America's Amway Global Visa card is like any other credit card with competitive rates between 10 and 20%, but it also has rewards, which are always welcome by card holders.
Unlike many cards that offer SkyMiles or cash back, Amway IBOs are offered business volume (BV) that is representative of sales revenue in the form of 3% on all products purchased on the Amway Global website, and 2% on all purchases made at other retailers.
So, if a person's family had monthly expenses of $2,000 that they placed on their Amway Global Visa card each month, with half coming from the purchases on the Amway Global website and the other half coming from other retailers, this IBO would gain a revenue boost of $50 BV.
How Much of the BV Goes to IBOs?
Amway Global IBOs receive a percentage of the products that are moved by them personally and in their networks. Bonuses range from 0-25%.
If the above person who used her IBO Visa card but did not have enough volume to merit a bonus, then she would receive $0 in return for her Visa purchases. If, on the other hand, she was a top performer operating at the Platinum level or above, then she would receive 25% of all recorded sales volume, including the bonus volume received from Visa usage.
The benefit would amount to a return of $12.50, which is significantly less than other rewards programs.
Comparing the Amway Global Visa Card to a Cash Back Rewards System
Other rewards systems from credit cards include SkyMiles and cash back. The cash back is usually 1% of money borrowed and repaid, but can be higher during promotional periods.
Using the cash back method, that same person who had $2,000 of card usage for a return between $0 and $12.50 would receive a guaranteed $20.
Over the course of a year, that same consumer would receive $240 in rewards through cash back as opposed to a range of $0 for those not earning bonuses to $150 for Amway Global's top business people.
On top of all this, the credit card rewards that Amway Global IBOs receive is subject to income tax at the end of the year, whereas normal cash back rewards are not. So, if a top IBO was in the 25% income tax bracket, he would actually only receive $112.50 of his rewards over the course of a year, or less than half a percent in rewards earnings.
The Amway Global Visa card distributed by MBNA is a great program for those who have no other means of obtaining rewards from other credit card issuers. For anyone else, the rewards offered are inferior, and, in some cases, non-existent. For them, this card's rewards fall short.
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