Putting all your spending on a credit card sounds risky. But choose the right deal – and use it in the right way – and it can be financially rewarding.
There are a number of enticing rewards and cashback cards available to reliable borrowers. But these deals do come with catches.
Here are the best cashback and reward credit cards on the market, with the small print you need to read closely.
The card: American Express Platinum Cashback Everyday Credit Card
Pays 5pc cashback on up to £2,000 of spending in the first three months of account opening. Account holders will then get between 0.5pc and 1.25pc cashback thereafter, depending on how much you spend on the card. There is no annual fee.
The catch: You must spend at least £3,000 a year to qualify for cashback. So, as an example, if you spend £1,000 in the first three months, and £2,000 in the remaining nine, you’d receive £60 back that year. Plus, not every outlet accepts American Express, so it’s wise to carry a back up card.
The card: Barclaycard Freedom Rewards Card
Points are earned everytime you use your Freedom Rewards card, with one point given for every £1 spent on general spending and double points at British supermarkets, petrol stations and on TFL. You also get three points for every £1 spent at certain High Street stores and restaurants.
Points can be used in any of Barclaycard’s 70 participating partners, including Amazon, Argos, Boots and Marks & Spencer – see the full list.
The catch: It’s obvious – but don’t let the points tempt you into overspending. Note that these points are also wiped from your account after three years.
The card: Santander 123 Credit Card
123 credit card holders will earn cashback on everyday spending, including 1pc cashback at all major supermarkets (Tesco, Asda, Morrisons, Sainsbury’s and so on), 2pc cashback at major department stores (BHS, Debenhams, John Lewis et cetera) and 3pc cashback at all major petrol stations, National Rail and TFL (up to £300 a month on petrol and travel spending).
So, if you spend say £250 each month on supermarket shopping, £50 at a department store, £150 on petrol and £100 on London transport, you could earn £132 in cashback each year.
The catch: It costs £24 a year. All new and existing customers get their first year’s annual fee refunded if they also open a 123 Current Account. This offer ends January 10 2016, where the fee will also increase to £36 a year.
The card: Tesco Bank Clubcard credit card
Get one Clubcard point for every £8 spent on everyday spending and five Clubcard points for every £4 spent in Tesco stores or on Tesco fuel.
Every point earned equates to 1p worth of vouchers, so 500 points will be exchanged for a £5 voucher. These vouchers can be used at the till for money off your next Tesco shop, or at any of Tesco’s participating partners, including Odeon cinemas, Pizza Express and Legoland.
The catch: You cannot apply if you already hold another Tesco Credit Card
The card: Asda Money credit card
If you’re an Asda customer already, this pays 1pc cashback on Asda shopping and fuel. You can also earn 0.5pc cashback when you buy things everywhere else – because the card is mastercard, it can be used in over three million outlets. Plus, for a limited time, it’s paying 10pc cashback on insurance products such as home, car, pet or annual travel insurance.
The catch: Cash is credited to your account the following month. Plus, there are better offers available if you’re not an Asda shopper already.
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