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Credit Card Rewards Get flights, points, cashback & more

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Best credit card rewardsThe top credit card reward schemes pay you £3 for every £100 spent on them, an easy way to make £100s or £1,000s a year just by changing plastic. Yet some use impenetrable points systems to disguise poor payouts.

This guide intensively analyses every major scheme to calculate the best buys for frequent flyer points, cash, and more. It includes our RewardsChecker tool, which compares all the schemes.

For more ways to make money from credit cards, read the Cashback Credit Cards and Credit Card Freebies guides

How reward cards work

The premise is simple. Spend on one of these cards and they pay you - some of these cards even pay you cashback. Do it right and you can earn £100s worth of goodies each year, at no cost. If you're debt-free and pay off every month, you might as well get paid to spend.

It sounds great - everyone loves something for nothing. But unless you're careful, cards will actually deliver nothing for something, as there are a couple of major holes to watch for.

The reason cards give rewards is to encourage spending, as do that and they can charge us 15% interest or more and retailers up to 1%. So always follow…

The golden rule of rewards credit cards

Getting charged interest almost always dwarfs even the very best reward schemes, so quite simply…

If you want rewards, always set up a direct debit to repay the card in full each month, so there's NO interest.

Sadly, some card providers deliberately miss the 'repay in full' option off their direct debit forms. If so, just write 'pay off in full' and send it in. It should be honoured, but call to check.

It's also worth watching for any annual fee. These are now rare, and everyone except very high spenders should avoid any card with one. The cost isn't usually recovered by the extra rewards.

Can't repay in full every month?

If you're not sure you can always repay the card in full, then DON'T pick a card for rewards. Focus on a card with a lower interest rate instead. - see the 0% Credit Cards guide.

0% Credit CardsAs applying for any financial product has a minor credit score impact (see the Credit Scores guide), if you have existing credit card debts, it's also worth prioritising making them cheap before going for rewards by doing a balance transfer.

Don't believe the hype

Some schemes are focused on making people think they're earning large, when actually payouts are pretty paltry. To what extent depends on the type of scheme.

  • Rewards schemes

    Here you earn days out, flights, holidays or more by getting points - and that's where the problems start, as Martin points out...

    "Martin Lewis, site founder and editorFor a TV programme stunt I was once asked to design a credit card that looked good, but contained hidden, abysmally anti-consumer traps. Many signed up to my fake MACS card (SCAM backwards), which promised TWELVE points per pound spent.

    "Most people didn't ask what the points were worth. In fact, they were worth 0.0001p. In other words, nothing. And 12 nothings… is nothing.

    "It's this lack of transparency that allows reward schemes to create a magical 'something for nothing' mystique. A Sainsbury's Nectar point is worth up to 1p compared to a Tesco Clubcard point worth up to 4p, so one Clubcard point is worth almost eight times more than the Nectar points.

    "That's what this guide focuses on; a mathematical evaluation of every scheme to pick the real winners."

  • Cashback or cash-lite cards

    With cashback cards you earn cash each time you spend, and it's then usually paid once a year as a lump sum (see the Top Cashback Cards guide). The main advantages are you know exactly what you're getting and can spend the rewards anywhere.

    Cash-lite schemes are where money earned can be converted into gift vouchers or can only be spent in a specific store, eg, M&S.

Grab credit card freebies

Many credit cards offer incentives such as free flights or electronic goods for you to sign up to the card. Therefore if you've a good credit score, just take advantage by signing up even if you don't want the card. A full list of what's available is in the Credit Card Freebies guide.

Best buy credit card reward schemes

These results are based on evaluating over 40 schemes, calculating the actual value of the rewards for spending. This is done by first number-crunching what an individual point's really worth, then how many points you get when you spend.

Read more about the valuation process

The rewards are measured in percentages. So a 1.5% reward means you get an average £1.50 worth of points for each £100 spent.

Unless stated, all cards were judged on annual spend of £10,000; very achievable if you lump all your normal spending on it. Plus it incorporates annual fees and unless noted, introductory bonus points. We've separated the top deals into categories.

Top cashback cardsBest cash returns

This is the top cashback card currently available. This card has a big intro bonus. For full options see the Top Cashback Cards guide.

Amex Platinum Everyday 5% intro cashback + up to 1.25% after

amex
  • Representative variable rate: 19.9% APR (see Official APR Example)
  • Cashback: 5% in the first 3 months (max £100), then up to 1.25% after.
  • Annual fee: NONE
  • Min income: £20,000 household income
  • Max cashback/year: NONE
  • Cashback expiry: N/A

The American Express* Platinum Cashback card pays new cardholders 5% intro cashback for the first three months on up to £2,000 spending. After this, cashback is tiered depending on how much you spend.

Spend up to £3,500 to earn 0.5% cashback. Spending from £3,501 to £7,500 will earn you 1% cashback while spending above £7,501 in a year will earn you the top rate of 1.25% cashback.

Make sure you repay in full EVERY month to avoid the 19.9% representative APR, or interest will quickly wipe away the cashback gains.

Amex Platinum5% intro cashback + 1.25% after (but £25 annual fee)

amex
  • Representative variable rate: 18.7% APR spending is 14% (see Official APR Example)
  • Cashback: 5% in the first 3 months (max £125), 1.25% after
  • Annual fee: £25
  • Min income: £20,000 household income
  • Max cashback/year: NONE
  • Cashback expiry: N/A

The American Express* Platinum Cashback card pays cardholders 5% cashback for the first three months (up to a maximum of £125). It then pays a flat 1.25% cashback afterwards, but it also charges an annoying £25 annual fee.

If you spend over £10,000 in a year, you'll also get unlimited 2.5% cashback in your anniversary month.

While the flat rate is a big plus, the annual fee wipes away some of the gain - and if you happened to spend less than expected, you'd still be hit with the fee, making this card less profitable than the Amex Platinum Everyday card.

The card charges 14% interest on spending, so repay in full each month to avoid that. The representative APR, including the fee, is 18.7%.

MBNA More RewardsEarn points to spend at Argos, Debenhams, Topshop & more

MBNA
  • Representative variable rate: 12.9% APR (Official APR Example)
  • Annual fee: None
  • Reward scheme: MBNA Reward Points
  • Value of 1 point: 0.5p
  • Points per £100: 200 with Amex
  • Points' expiry: N/A

The MBNA More Rewards Amex pays four Reward Points per £1 for the first 90 days. It also comes with a Visa card to use in retailers not accepting Amex, which pays two reward points per £1 for the first 90 days.

After that, you earn two points for every £1 spent on Amex and one point per £1 on Visa, so use the Amex as much as possible.

To get a £10 voucher - which can be used at around 100 retailers including Argos, Debenhams and Topshop - requires 2,000 points. You can redeem the points for cash too, but you'll need 5,000 to get £20 back and Top Cashback Cards beat this.

To redeem points and see what else you can exchange them for, you'll need to log into your online account.

Any gains made will be lost if you're hit by the 12.9% representative APR if you fail to repay in full. Set up a direct debit to ensure you don't forget.

Airline credit cards and rewardsFlights

There's a variety of different schemes, but part of the choice depends on which airlines you prefer and their availability, as often the big gain comes from using credit card points along with points from frequent flying.

Watch out for taxes and charges, as all reward schemes make you pay these on top. In some cases, you may find it cheaper to use the Cheap Flights guide instead. Or for dedicated flyers, see the Airline Credit Cards guide.

BA Amex Earn miles for BA flights plus companion flight at £20k+ spend

ba
  • Representative variable rate: 15.9% APR Official APR example
  • Annual fee: None
  • Reward scheme: BA Miles (Avios points)
  • Points per £100: 100
  • Taxes included? No
  • Points' expiry: 36 months, if you don't earn or redeem miles in that time

For some this card is a gateway to cheap flights or upgrades on one of the biggest airlines. Others don't see what all the fuss is about.

The BA Amex* card pays one Avios point for each £1 you spend. A return flight to Berlin with British Airways is typically 9,000 points on the scheme. If you're travelling further afield, a return flight to Marrakech is typically 20,000 points.

Not too good so far. But spend over £20,000 in a year, and you get one free 'companion ticket' when booking a flight. So if you're in a trusting relationship, it's worth you both spending on a joint card.

The card often gives sign-up bonuses too. Apply now and you'll get 3,000 Avios points when you successfully apply and spend £500 within the first three months. Compare this with the other frequent flyer cards in the Airline Credit Cards guide.

The 15.9% representative APR means you should make sure you pay the card off in full each month. See more ways to Boost Your Avios Points.

Lloyds Bank AviosEarn Avios miles (for BA & others)

lloyds
  • Representative variable rate: 22.7% APR; spending is 17.9% Official APR example
  • Annual fee: £24
  • Reward scheme: Avios
  • Points per £100: 100
  • Points' expiry: 36 months, if you don't earn or redeem miles in that time
  • Taxes included? No

Apply for the Lloyds Bank Avios* and you get two pieces of plastic, an Amex and a Mastercard. Always use the Amex version where possible as it pays much higher returns; 1.25 Avios point for every £1 you spend. Plus, get double Avios points for six months from account opening with the Amex card - so 2.5 Avios points for every £1 spend.

If you spend £7,000/year you'll be sent a voucher for two flight upgrades, either for two single flights or one return journey. This means you can get a New York return upgrade to business class for the 60,000 Avios cost of premium economy, or to premium economy for the 40,000 Avios economy cost.

For more details on this card, see the full Airline Credit Card guide. The card has a 22.7% representative APR, 17.9% of which is charged on spending, so make sure you pay the card off in full each month.

MBNA AadvantageEarn Aadvantage miles (for American Airlines, BA & others)

lloyds
  • Representative variable rate: 17.9% APR Official APR example
  • Annual fee: NONE
  • Reward scheme: Aadvantage miles
  • Points per £100: 150
  • Points' expiry: 36 months, if you don't earn or redeem miles in that time
  • Taxes included? No

Apply for the MBNA Aadvantage* and you get two pieces of plastic, an Amex and a Visa. Always use the Amex version where possible as it pays much higher returns; 1.5 Aadvantage point for every £1 you spend (the Visa's 1.5 miles for every £2).

Aadvantage is American Airlines' loyalty programme, but it can be used on a number of other airlines including British Airways. If you make any purchase on the cards within the first 90 days you'll earn 5,000 bonus miles. Then, if you go on to spend £1,500 in the first 90 days, you'll earn an additional 10,000 bonus miles.

A London to Amsterdam return flight with British Airways is typically 20,000 miles on the scheme, although you have to book via American Airlines. The sign-up bonus on this card is attractive, but if you're a regular BA flyer, you may prefer the BA Amex above.

The 17.9% representative APR means you should make sure you pay the card off in full each month.

Supermarket loyalty

Some cards only give rewards, vouchers or cash for certain retailers or when spending in a particular store. They can be useful if you're a creature of habit, and like to do your weekly shop at the same place every week.

Tesco Clubcard Up to 1% for days out, restaurants, hotels, magazines & more

tesco
  • Representative variable rate: 18.9% APR (Official APR Example)
  • Annual fee: None
  • Reward scheme: Tesco Clubcard Points
  • Value of 1 point: Up to 4p on Rewards, 1p instore
  • Points per £100: 25
  • Points' expiry: Points for 2 years, Rewards vouchers for an extra 6 months

The Tesco Clubcard* credit card gives five Clubcard points for every £4 you spend on it in Tesco (a bonus of one point over the normal Clubcard) as well as one point for every £4 spent elsewhere. If you're an existing Clubcard holder then just add your Clubcard number to the application form to link your account.

One point is worth 1p (so just a 1.25% return) if spent in-store at Tesco, but boosts to up to 4p (so 5%) if redeemed for some of Tesco's special Clubcard Rewards vouchers. These can be used for a huge array of mainly entertainment-based treats.

For more details on boosting Tesco Clubcard points, read the Loyalty Points guide. The 18.9% representative APR means you should make sure you pay the card off in full each month. Alternatively look at the Tesco Clubcard Low APR* credit card for a 7.8% APR but with the same Clubcard benefits.

Sainsbury's Nectar Get Nectar points + get 16 months 0% on purchases

Sainsburys Credit Card
  • Representative variable rate: 16.9% APR Official APR Example
  • Annual fee: None
  • Reward scheme: Nectar points
  • Value of 1 point: 0.5p
  • Points per £100: 200
  • Points expiry? : None unless account is closed.

The Sainsbury's Nectar Purchases* credit card gives 1 Nectar point for every £5 you spend on it.

You also earn two points for every £1 spent in-store at Sainsbury's or at a Sainsbury's petrol station, though remember these points are only worth 0.5p each when spent in-store at Sainsbury's.

But you do have the option to redeem Nectar points with other retailers in the Nectar scheme, such as Pizza Express, Argos, eBay, Eurostar and more - and in some cases the point value increases.

The 16.9% APR means you should make sure you pay the card off in full each month. Alternatively look at the Sainsbury's Low APR* credit card for a 6.9% APR but with the same Nectar point benefits.

Ending soon. Marks & Spencer* Get 0.5% back in vouchers, + £5 joining bonus + £30 wine voucher

M&S
  • Representative variable rate: 16.9% APR
  • Annual fee: None
  • Reward scheme: M&S points
  • Value of one point: 1p
  • Points per £100: 100 in M&S; 50 elsewhere
  • Points expiry : None unless account is closed.

If you're more of an M&S shopper, the M&S* credit card gives one M&S point for every £2 you spend on it, though this is boosted to one point per £1 in M&S and its online store.

You collect points as you spend, which are converted into Marks & Spencer vouchers quarterly. You get 0.5% back on most purchases (50p per £100 spend) and 1% (£1 per £100 spend) when you spend in M&S.

There's also a bonus 500 points (worth £5) when you first use the card to spend anything in M&S on food, clothing or homewares.

If you apply through the above link by 31 August, and make a purchase (for any amount, even 1p, in any shop) before 30 September you'll receive a £30 M&S voucher to spend on wine, champers or soft drinks.

The 16.9% APR means you should make sure you pay the card off in full each month. M&S, like many other banks, tries hard to sell you other products and memberships once you're a customer, so be wary.

American Express Nectar 20,000 bonus points in first three months

Flybe
  • Representative variable rate: 25% APR incl £25 fee - spending is 19.9% Official APR Example
  • Annual fee: £25
  • Reward scheme: Nectar
  • Value of one point: 0.5p
  • Points expiry: None unless account is closed.
  • Points per £100: 400 in Sainsbury's & Nectar partners; 200 elsewhere

Sign up to the Amex Nectar* card, spend £2,000 on it in the first three months, and you'll get 20,000 points. These are worth around £100 and can be spent on anything in the Nectar Rewards website. If you're just grabbing this for the freebie, don't forget to factor in the £25 annual fee.

You get two points for every £1 spent on the card, but this is boosted to four points per £1 when spent in-store at Sainsbury's, or with another outlet that takes Nectar (includes eBay, Homebase, BP, Expedia.co.uk and more).

Points are worth 0.5p when redeemed, but a small selection of retailers give 1p per point, making this freebie worth £200 at theme parks Legoland, Alton Towers, Thorpe Park, Chessington, Madame Tussauds and Warwick Castle (read Loyalty Schemes for ways to max these).

As long as you spend the £2,000 on items you would have bought anyway (food shopping, for example), this is up to £75 for free after you've paid the fee. The 19.9% representative APR means you should make sure you pay the card off in full each month.

John Lewis/WaitroseUp to 1% back at John Lewis and Waitrose

tesco
  • Representative variable rate: 16.9% APR (Official APR Example)
  • Annual fee: None
  • Reward scheme: Partnership points
  • Value of 1 point: 1p
  • Points' expiry?: Points for 2 years
  • Points per £100: 100 in John Lewis/Waitrose; 50 elsewhere

The Partnership credit card gives one point for every £1 you spend on it at John Lewis or Waitrose and one point for every £2 elsewhere. You collect points as you spend, which are converted into vouchers three times a year. The vouchers can be spent with John Lewis, John Lewis Direct and Waitrose.

Always pay off the card in full every month, or the rewards points are wiped by the 16.9% representative APR.

Asda Money 1% cashback for Asda shoppers

amex
  • Representative variable rate: 14.9% APR (see Official APR Example)
  • Cashback: From 0.5% to 5%
  • Annual fee: NONE
  • Min income: £10,000 household income
  • Max cashback/year: NONE
  • Cashback expiry: N/A

If you're an Asda shopper, the Asda Money credit card pays cardholders 1% cashback on shopping done in-store and online, or on Asda fuel.

All other spending attracts 0.5% cashback. There's also a bonus 5% cashback on any spend on an Asda Insurance product (although remember that even factoring in the cashback, this may not be the cheapest insurance).

This card offers a reasonable cashback rate, especially if you're an Asda shopper, although if you've any big purchases to make, the 5% intro cashback on the Amex Everyday card makes it a better pick.

You'll be charged 14.9% representative APR if you don't pay the card off in full at the end of each month.

Petrol spending

Some cards give rewards specifically for spending on fuel and motoring. They can be useful if you spend big or often.

Santander 123 - 3% cashback Card pays 3% cashback on fuel & travel BUT has £24/yr fee

Santander
  • Representative APR: 16.5% APR (Official APR Example)
  • Annual fee: £24
  • Max cashback: £9 on fuel and rail (max eligible spend of £300 per month), unlimited on other eligible spending
  • Cashback expiry: N/A
  • Min income: £7,500

The Santander 123* credit card offers up to 3% cashback on certain spending, including fuel and rail costs.

But it has a £24 annual fee, so you need to carefully weigh up if your planned spending would exceed this in cashback terms - you'd likely need to be a big petrol spender to 'win', though existing Santander 123 bank account holders get year one's fee refunded.

The 123 card pays 3% cashback on fuel and rail spending (max £9/month), 2% in major department stores and 1% in major supermarkets. From June to August there is also a bonus 1% cashback on flights, hotels and travel agent spending. See a full review of the cashback you can get with Santander 123.

There's an introductory 18 months 0% on spending, but when this has finished you'll pay 12.7% interest on spending (16.5% representative APR, including the annual fee), so make sure you pay off the card in full each month.

AA RewardsEarn cashback and vouchers

tesco
  • Representative variable rate: 16.9% APR (Official APR Example)
  • Annual fee: None
  • Reward scheme: AA Reward Points
  • Value of 1 point: Up to 1p with AA
  • Minimum income: £20,000
  • Points per £100: AA member - 200 on fuel/motoring, 100 elsewhere; Non-member - 100 fuel; 50 e'where
  • Points' expiry?: Points for 2 years, Rewards vouchers for an extra 6 months

The AA Rewards* credit card gives one point for every £1 you spend on motoring or fuel and for every £2 on everything else.

If you're an AA member, rewards are boosted. You earn two points for every £1 you spend on motoring or fuel and one point per £1 on everything else.

One point is worth 1p if spent on AA products, but is only worth 0.5p if redeemed as cashback, for shopping vouchers or an array of other rewards.

If you don't pay off in full at the end of each month, you'll be charged 16.9% representative APR on your statement balance.

Boost the value of your points and rewardsBoost the value of your points

By correctly targeting the right rewards to redeem your points on, it is possible to substantially increase the amount. To find out how to do this for all schemes and specific info for Nectar, Avios and Tesco, read the Boost Your Loyalty Points guide.

Use the card for all spending

Once you set up a credit card, every time you use it you get paid. While this isn't an excuse to 'spend more', it does mean from now on…

Use the rewards card for ALL normal spending, replacing cash, cheques, and other debit, credit and charge cards.

For those who have work expenses they need to reclaim, this can be a powerful way to earn more, at no cost to you, provided you can cope with paying the bill in full each month.

There's extra protection on all spending too…

There's another big bonus to using a rewards card. You actually have far more consumer protection. This all comes about due to what's called Section 75 of the Consumer Credit Act 1974. It says…

75. - (1) If the debtor under a debtor-creditor-supplier agreement falling within section 12(b) or (c) has, in relation to a transaction financed by the agreement, any claim against the supplier in respect of a misrepresentation or breach of contract, he shall have a like claim against the creditor, who, with the supplier, shall accordingly be jointly and severally liable to the debtor.

Which of course, reads like gobbledegook… yet in a nutshell means:

Buy something costing over £100, here or abroad, and pay on a credit card, and the card issuer's equally liable if something goes wrong.

Now this protection only applies to credit cards, not debit cards or any other plastic and it's hugely important, especially in the current credit crunch climate. It means order something and if the retailer went kaput, you'd still be able to claim your money back from the card company. Read a full guide on Section 75 Refunds.

Think before adding the 'insurance'

Payment protection insurance is commonly sold with credit cards - the idea is it'll make some payments for you, usually for a year, if you are unable to (eg, if you lose your job).

Payment protection insurance and credit cardsThere have been a myriad of cases where it has been mis-sold. Some borrowers didn't realise they were signing up for it, or it was totally unsuitable for them. Some big lenders have been fined.

The protection isn't always bad, though policies sold by credit card companies are often overpriced (you pay a monthly amount depending on the size of your balance). If you want it, compare the lender's cover with standalone providers such as Paymentcare or Best Insurance.

Always be vigilant to check you aren't getting more than you bargained for when you fill in the application, then check your statement each month to check you aren't inadvertently paying for extras if you didn't ask for them.

Reward cards Q&A

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