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Credit Card Rewards

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credit card rewards
Sam McFaul
Sam McFaul | Edited by Martin Lewis
Updated 4 February 2019

Spend on one of these cards and it pays you – either in pure cashback or points that can be converted into vouchers for shops, airlines, hotels etc. If you're debt-free and pay off your card every month, you can earn goodies worth £100s each year.

Best reward cards

In this guide

Who's this guide for? People who pay off their credit card balance in full every month who want to be rewarded for their spending.
 

Not what you want? If you're looking to cut debt costs or want other ways to make money from credit cards, see...
Top Airline Credit Cards | Cashback Credit Cards | 0% Balance Transfers
0% Money Transfers | 0% Purchase Credit Cards | Stoozing | Our Credit Cards Section

How do reward credit cards work?

Reward cards can be a great way of earning £100s' worth of bonuses, just for doing your everyday spending. 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. We take you through the top cards and the potential pitfalls below.

Use our eligibility calculator to find cards you're most likely to get, without hitting your credit score

Making an application is recorded on your credit file. While a single one is not a big problem, especially if you've a good credit score, lots in a short time are problematic.

So use our Reward Credit Cards Eligibility Calculator to show cards you're most likely to get, so you don't waste an application. And it's NOT recorded as a hard search on your credit file.

The seven need-to-knows

Get it wrong, and you could actually be left out of pocket, so here's all you need to know to get the best from reward credit cards...

  • 1. Set up a direct debit to repay in full each month so you'll never pay interest, which will dwarf the gain

    Getting charged interest almost always scuppers 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 and check to be safe.

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

  • 2. Use the card for all NORMAL spending to max rewards

    Once you've 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.

    Do check it's fine with your employer though, as there's a chance it could be seen as a taxable benefit (you'll still be up even if it is).

  • 3. Check the rewards are right for you and the real value of the points

    Some schemes are focused on making people think they're earning large, when actually payouts are pretty paltry, so go through our best buys below meticulously to check which you'll actually get value from. To what extent depends on the type of scheme.

    • Rewards schemes

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

    "For 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 0.75p compared to a Tesco Clubcard point worth up to 3p, so one Clubcard point can be worth almost four times more than a Nectar point.

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

  • 4. First use our eligibility calculator to find cards you're most likely to get...

    Usually, the only way to know if you'll be accepted for a card is to apply, but each application marks your credit file. But our Reward Credit Card Eligibility Calculator quickly shows your odds of getting almost every top reward card so you can find the ones most likely to accept you, thus minimising applications.

    How does the eligibility calculator work?

    It uses a 'soft search', which is one you will see on your credit file but lenders usually don't (and where they do they can't use the info), to give us an indication of your credit score. We then match this against lenders' criteria for acceptance so we can show you the odds of getting each card.

    Once you have this knowledge, it will allow you to make a smarter application. Say you have a much better chance of getting a card that's just one month shorter at 0%, you may want to go for that. Therefore, you're less likely to be rejected and less likely to need to apply elsewhere, which would add another mark on your credit file.

    Or join our Credit Club for a full credit health check

    The MSE Credit Club is a game-changer. For years the credit market has been shrouded in mystery, but our revolutionary tool brings together the key components to give you the full picture, and crucially, what it means for your acceptance chances and how to boost your creditworthiness.

    A credit score alone isn't enough to borrow, as there are other factors at play (it's why many with perfect scores still get rejected). Credit Club shows your Free Experian Credit Report and Credit Score, your Affordability Score, you Credit Hit Rate and much more.

  • 5. Boost the value of your Avios, Nectar and Tesco points

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

  • 6. Sort out debts before going for reward cards

    You'll save more by keeping your debts cheap instead of going for reward cards. Every card application has a credit score impact, so make sure your debts are sorted before applying for cashback cards (see Best Balance Transfers for help cutting the cost of debt).

  • 7. Don't borrow or withdraw cash on these cards

    They're a tool to get you rewards by using them like a debit card and clearing them each month, and we rate them based on that. If you need to borrow as well, you're far better off focusing on getting the lowest interest rates – that'll save you much more money. See 0% Credit Cards for Spending and Best Balance Transfers for more info.

    And when it comes to withdrawing cash the rule is simple – never, ever, ever use these cards for cash withdrawals as you'll often be charged a fee and interest, even if you pay the card off in full.

Top cashback cards

These are the top cashback cards available, which have a big intro bonus. For full options see our Top Cashback Cards guide.

Amex Platinum Everyday*

Top pick as highest payer, giving up to 5% but not accepted everywhere

Check eligibility

Apply*

The American Express Platinum Everyday* is the top fee-free card, especially if you've big spending to do in the next few months. It has a 5% introductory rate for the first three months on your first £2,000 of spending (max £100 cashback), then 0.5% cashback on up to £5,000/yr and 1% above this. You need to spend at least £3,000/yr to earn any cashback. Note, as it's an Amex it's not accepted everywhere and you won't get the bonus if you've held an Amex cashback card in the past six months.

Would spend over £9,000 on it a year? In that case, try the Amex Platinum (eligibility calc / apply*). It has a £25 annual fee, but gives the intro 5% rate on up to £2,500 of spending (so max £125) and then tiers up to 1.25% in cashback and so is a winner for bigger spenders. Repay IN FULL or it's 28.2% rep APR (incl fee).

Representative APR (variable): 22.9% APR ( Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Cashback: 5% in first three months (max £100), then up to 1% after
Annual fee: None
Min income: N/A

See how likely it is you'll get this card

MSE's Eligibility Calculator

Go straight to the lender

Apply*

Tandem 

Best non-Amex card with 0.5% cashback

Apply

The Tandem credit card pays 0.5% cashback on purchases. As a Mastercard it's also more widely accepted than Amex, especially in smaller retailers. To apply, you must download the Tandem app for iOS or Android.

Representative APR (variable): 18.9% APR (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Cashback: 0.5%
Annual fee: None
Min income: £13,000

Go straight to the lender

Apply

Top 'close to cashback' deals

Some reward cards give you points on all of your spending. These can come close to cashback cards as they offer the ability to spend the points you earn in a wide variety of places.

Amex Gold*

Get £100 M&S/Amzn vch or 20,000 Avios + 2 free airport lounge passes

Check eligibility

Apply*

If you're accepted for the Amex Preferred Rewards Gold* credit card, and spend £2,000 in the first three months, you'll get a bonus 20,000 reward points, equal to £100 in high street vouchers or 20,000 frequent flyer points, such as Avios. Plus you get two free visits to airport lounges (see FAQs below)

The card usually has a £140 annual fee, but is fee-free in the first year, so to avoid it, remember to cancel before year two starts. Note, as it's an Amex it's not accepted everywhere and you won't get the bonus if you've held an Amex Membership Rewards card in the past six months.

Representative APR (variable): 57.6% representative APR (incl fee), 22.9% interest on purchases (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Annual fee: No fee in year one, but £140 from year two onwards
Standard points earned (excl bonus): One per £1 on day-to-day spending, two points per £1 spent directly with airlines or in a foreign currency 
Value of one point: 0.5p
Points' expiry: N/A

  • What's the deal with the airport lounges?

    You get two free visits to airport lounges (see affiliated lounges) which you can use for yourself twice on two separate visits, or yourself and one guest for one visit. 

  • What rewards can I get from this card?

    You can convert points into vouchers for Amazon, M&S and more. Alternatively, you can convert them to frequent flyer or hotel scheme points and add them to your current stash (transfers can take up to five working days). For full options see the Membership Rewards site.

    We've analysed how much you might get back from different levels of spending...

    ANNUAL OVERALL SPEND £3,000 £5,000 £10,000 £20,000
    Points earned, incl bonus 24,500 27,500 35,000 50,000
    Converting to vouchers £100* £125* £175 £250

    Assumes 50% of spending on air travel and abroad and 50% elsewhere

    * = doesn't use the entire points total

  • How can I further boost points?

    You get a 10,000-point bonus on the anniversary of taking out the card if you've spent more than £15,000, but remember, if you keep the card into a second year, you'll pay the £140 annual fee.

    You can also boost your points by getting a supplementary card (for a partner/friend), whose spending will then earn points. The first card is provided free, though any more will cost £45.

    Plus, if you have a friend who has the card, get them to recommend you, and both of you get 2,000 bonus points.

  • Can I use points to pay off purchases?

    Yes, but you'll receive slightly less than you'd get exchanging for vouchers; 1,000 points gives £4.50 'cashback' vs £5 in vouchers – so it's not the best use of them.

  • Can I use my airport lounge passes for additional visits or guests?

    Yes – additional guests or visits cost £15 charged to your Amex.

  • How are the gift vouchers sent?

    Gift cards are sent by post (within 10 working days) or email.

  • Can I cancel the card and apply again for the bonus?

    In order to qualify for the introductory bonus, you can't have held an Amex card offering membership rewards points within the past six months. So if you're keen to qualify for the bonus more than once, you must first cancel your card and wait six months before applying again.

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Amex Rewards*

Get £50 M&S/Amzn vch or 10,000 Avios – an alternative to the Amex above for lower spenders

Check eligibility

Apply*

If you won't hit the spending trigger on the card above, or you want a card that's fee-free all the time, this could suit you better. Spend £1,000 on the Amex Rewards* credit card in the first three months and you'll get 10,000 bonus points, which you can convert into £50 of vouchers at retailers such as Amazon and M&S. 

Note, as it's an Amex the card isn't accepted everywhere and you won't get the bonus if you've held an Amex Membership Rewards card in the past six months.

Representative APR (variable): 22.9% interest on purchases (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Annual fee: None
Standard points earned (excl bonus): One per £1 spent
Value of one point: 0.5p
Points' expiry: N/A

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Amex Nectar*

Get 20,000 Nectar points, worth £100, plus ongoing cashback

Check eligibility

Apply*

Spend £2,000 on the Amex Nectar* card within first three months, and you'll get 20,000 bonus Nectar points. These are worth at least £100 and can be spent at Nectar retailers such as at Sainsbury's.

Just do your normal spending on it to get the bonus (it's an Amex so may not be accepted everywhere), and remember to cancel after one year if you want to avoid the £25 annual fee that kicks in from year two.

Representative APR (variable): 28.2% APR (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Annual fee: Free in year one, then £25 
Standard points earned (excl bonus): Two per £1 spent
Value of one point: 0.5p (1p at some retailers)
Points' expiry: One year if you don't collect or spend any points

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Top airline cards

There are 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, though, as all reward schemes make you pay these on top when you book a flight using points, which means in some cases it may be cheaper to fly with a budget airline. Read our Cheap Flights guide.

We've only listed the top fee-free card, but you can earn more airline rewards with other cards which charge a fee. Frequent flyers should read Airline Credit Cards for all our top cards.

BA Amex*

Top fee-free card if you like to travel, plus free companion flight at £20k+ spend

Check eligibility

Apply*

Fancy yourself as a bit of a jet-setter? Then the British Airways Amex* can reward you with free flights. Plus, if you're accepted you'll get 5,000 bonus Avios points if you spend £1,000 in the first three months (it's an Amex so isn't accepted everywhere).

You need to be flexible with dates as only a limited number of seats per flight are set aside for Avios customers. You can also get a 'free' companion ticket if you spend £20,000/year on the card (see FAQs for more).

Representative APR (variable): 22.9% APR (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Annual fee: None
Standard miles earned (excl bonus): 1 Avios per £1 spent
Points' expiry: Three years after you collect your last. Can I buy extra miles?

  • What's the deal with the companion ticket?

    Spend £20,000/year, and you get one free 'companion ticket' when booking your BA flight with Avios points. The free ticket can be used to get the same ticket type as the cardholder (if you go first class, so do they) – you'll need to pay taxes and charges on top for both tickets.

  • How many points do you need for a flight?

    An economy return flight from Heathrow to New York would cost 26,000 Avios, while a short-haul flight to Paris would cost 8,000 Avios (plus taxes and charges). See the BA website for more info.

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Top supermarket and stores' loyalty cards

Some cards give boosted 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.

Sainsbury's Nectar*

Possible £37.50 bonus Nectar points, plus earn points for all spending

Check eligibility

Apply*

If you're a Sainsbury's shopper, the Nectar Dual* credit card is a good deal. Give your Nectar card number when you apply and you'll get 750 bonus Nectar points worth £3.75 each time you spend £35+ in store or online at Sainsbury's (excl petrol) in the first two months (max 7,500 points, worth £37.50). Doing a big shop? Split it into £35 chunks to max bonus.

You also earn Nectar points on all spending. On top of this, you could get up to 28 months 0% on spending (some poorer credit scorers will get 25 or 22 months 0%), but only use this if you're disciplined and can fully repay by the end of the 0% period.

Representative APR (variable): 20.9% APR (Official APR Examples)
Important: Repay in full before end of 0% period to avoid interest (always pay at least monthly minimum) then clear IN FULL every month if you continue spending on it
Annual fee: None
Standard points earned (excl bonus): Two per £1 spent in Sainsbury's, one per £5 elsewhere
Value of one point: 0.5p
Points' expiry: None unless account is closed

See how likely it is you'll get this card

MSE's eligibility calculator

Go straight to the lender

Apply*

M&S Bank*

Get £25 in M&S vchs, plus earn points for spending, equiv to 2% in first year

Check eligibility

Apply*

Accepted new M&S Bank* cardholders can get a free £25 to spend in its stores on almost anything (incl clothes and food) if you follow the steps below. It's split into two parts...

  • £20 in M&S pts. Awarded the first time you use the card anywhere for any amount within 90 days
  • £5 M&S vch. You're sent a coupon with the card. Swipe it or use online with your card to buy most things at M&S for any amount and you get another £5 of points.

Representative APR (variable): 19.9% APR (Official APR Examples)
Important: Repay in full before end of 6mth 0% period to avoid interest (always pay at least monthly minimum), then clear IN FULL every month if you continue spending on it
Annual fee: None
Standard points earned (excl bonus): Two per £1 spent in M&S in first year (then one per £1), one point per £5 spent elsewhere
Value of one point: 1p
Points' expiry: Two years

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Don't shop at any of the stores above? More reward cards

If you don't shop at any of the supermarkets or stores above, here are some quick details of other cards to consider.

CARD (REP APR†) BONUS POINTS PER £100 VALUE OF ONE POINT ELIGIBILITY CALCULATOR
Amazon (21.9%) £10 Amazon gift card straightaway 75 at Amazon, 50 elsewhere 1p -
John Lewis* (18.9%)  N/A 100 at John Lewis/Waitrose, 50 elsewhere 1p You can use our eligibility calculator for this card
Asda* (19.9%)
 N/A 1% 'cashback' at Asda, 0.2% elsewhere (1) N/A You can use our eligibility calculator for this card
Tesco (19.9%) N/A 25 at Tesco, 12 elsewhere 1-3p (See how to boost points) -
†Representative variable APR, your interest may be different. (1) You don't get points, just 'cashback' which can only be redeemed as vouchers to spend at Asda.

Cashback sites may pay you for signing up

As an extra boon, members of specialist cashback websites can be paid when they sign up to some financial products. Do check that it's exactly the same deal though, as terms can be different. And remember the cashback is never 100% guaranteed until it's in your account. 

For full help to take advantage of this and the pros and cons, see our Top Cashback Sites guide.

Reward cards Q&A

  • Is it OK to use a reward card alongside a credit card with existing debt?

    It depends. You should always concentrate on repaying your debts, but if they're at 0% (in the form of, for example, a 0% spending or balance transfer card) then it's less of a problem – as long as you're certain you can repay them by the end of the 0% period.

    The golden rule for reward cards (hopefully it's large enough at the top of this guide) is always pay the card off in full at the end of the month. So if you have one card for rewards you do that with, and a separate card for your debts you should be OK.

  • Do I get Section 75 protection on these cards?

    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 means that if you buy something costing between £100 and £30,000, here or abroad, and pay on a credit card, 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. If a retailer were to go kaput, you'd still be able to claim your money back from the card company. Read a full guide on Section 75 Refunds.

  • Can I transfer a balance to a reward card?

    Sometimes, but there's little point in doing so – you don't earn points on balance transfers.

    Many reward credit cards try to tempt you with competitive balance transfer offers – they want you to spend and shift debts to them. It'll end up costing you as you're unlikely to be able to afford to repay the card in full. Instead use a separate card for balance transfers.

  • How do they make money if I always repay?

    The second source of income for card companies is the retailer. When you pay on a credit card, the card company gets between 0.1% and 0.3% of what you spend from the shop/restaurant and this will often cover the cashback.

    Therefore, in a way, all you're doing is getting back the extra that's been factored in to pricing for all customers to cover credit card costs.

    Generally, the bigger the retailer the less it pays, as it has more negotiating power with Visa or Mastercard. Also it's worth noting Amex tends to charge retailers more, one of the reasons some smaller companies don't accept it.

  • How many reward cards can I have?

    As many as you're accepted for – there's no limit. Though of course, every card application has a small impact on your credit score. So the more you have, the less likely you are to be accepted for more cards.

    Don't apply for lots if you may need credit for something important such as a mortgage or a balance transfer card. Full info in our Credit Rating guide.

  • Is it worth going for a card that gives bigger rewards in one store?

    If you spend a substantial amount of money in a store then it certainly is worthwhile. But don't let this blind you for the rest of your spending: make sure you maximise what you get elsewhere too (it may be worth having two cards).

    Also remember that lots of cards use a 'double earn' promise, so it looks like you get more points using your credit card in the linked store, but actually you would've got the same just using its normal loyalty card. See our Loyalty Points guide for a full explanation.

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