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credit card rewards

Credit Card Rewards

Earn cashback, points & more

Karl Talbot
Karl Talbot | Edited by Martin Lewis
Updated 15 February 2021

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. Plus our Rewards Eligibility Calculator will show credit cards you've the best odds of getting.

Top rewards credit cards

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 get rewarded for spending, see...
Top Airline Credit Cards | 0% Balance Transfers | 0% Money Transfers | Full Credit Cards Section

illustration

How do reward credit cards work?

Reward cards can be a great way of earning £100s' worth of bonuses/cashback.

Essentially, they're quite simple. You just do your everyday spending on them and, in return, you get cashback or points which you can turn into vouchers, or money off at various retailers.

It sounds great – everyone loves something for nothing. But unless you're careful, cards will actually deliver nothing for something, as you may get hit with interest if you don't pay off IN FULL every month. Some cards even impose a minimum spend to get the rewards – so always read carefully before choosing a card and make sure it'll work for you.

We take you through the top cards and the potential pitfalls below.

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 to never pay interest

    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.

    By doing this, you've effectively made your credit card a debit card, but one that pays you every time you spend on it. Just make sure you stay within the credit limit or you'll pay charges.

    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 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).

    Can I add an additional cardholder to my account to boost cashback?

    Yes, you can. By doing so, both your spending is eligible for cashback. Remember, with credit cards there's no such thing as a joint card – it's your card and you're giving them permission to spend on it. Any spending is yours to pay off, not theirs.

    Can I use a reward card to set up regular payments?

    You can, but you should avoid it. These are technically called recurring payments (or continuous payment authorities) and while you're now able to cancel them with your card provider, they have caused trouble for a lot of people in the past (see our Recurring Payments guide for more).

     

  • 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.

    • Cashback

      This is the most straightforward type of scheme – for every pound spent, you get a certain amount back, eg, 1%. But watch out for tricky terms: cashback tends to be paid annually as credit to your statement, and some cards have a minimum spend requirement to get any cashback.

    • 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...

    'Always ask what the points are actually worth'

    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. For example, a Sainsbury's Nectar point is worth 0.5p in store compared to a Tesco Clubcard point worth 1p.

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

    boost the value of your 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.

  • 5. 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 reward cards (see Best Balance Transfers for help cutting the cost of debt).

  • 6. 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.

  • 7. If you need other credit, applying for a reward card could harm your chances

    Multiple applications on your credit file in a short space of time can damage your chances of getting future credit so you need to weigh up whether getting one now is going to harm other more important credit applications you may have on the horizon.

    A single application may not kibosh your chance, but together with other negatives may well do. See Credit Score Boosting for more tips.

 Credit Card Eligibility Calculator

See which reward credit cards you've the best chance of getting, in your own personal best-buy table.

Usually, applying is the only way to know if you'll be accepted for a credit card. Yet that marks your credit file, affecting your ability to get future credit. To help, our tool uses a 'soft search' to find your chances of acceptance before applying.

Check your chance of acceptance

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The top-paying rewards cards are from Amex

pound sign

If you're looking for a cashback or reward card, your best bet is likely to be a card from American Express' range – they have big intro bonuses and give unbeatable ongoing rewards when compared with the rest of the market.

However, there are a couple of drawbacks: Amex isn't as widely accepted in shops compared with Mastercard and Visa, plus if you've held a personal Amex within the past two years, you won't be eligible for the introductory offers (if this applies to you, or if you need a backup card for when Amex isn't accepted, check out the top non-Amex cards).

In this section, we've listed the top Amex cashback cards, plus we've also got those that give decent ongoing points rewards and included details of what you can spend the points on.

Amex Platinum Everyday

Highest cashback payer with no fee, giving up to 5%. Best if you'll spend less than £10,000 a year – if you'll spend more, it's beaten by the Amex Platinum Cashback

Check eligibility

Apply*

The Amex Platinum Everyday (check eligibility / apply*) is the top fee-free card, especially if you've big spending to do in the next few months. It gives 5% back on your first £2,000 of spending in the first three months (max £100 cashback), then up to 1% after. Cashback is paid to your account annually – in the month after your card anniversary date.

Important: You need to spend at least £3,000/yr to earn any cashback.

Note: You won't get the intro 5% rate if you've held a personal Amex card in the past two years.

Representative APR (variable): 22.2% APR (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Cashback: 5% in first 3mths (max £100), then once you've spent £2k or after 3mths (whichever's sooner) it's 0.5% on the next £5,000/yr, 1% above £5,000/yr
Annual fee: None
Min income: 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 Platinum Cashback

Top cashback rates overall – but charges annual fee. Beats the Everyday above if you'll spend more than £10,000 a year

Check eligibility

Apply*

The American Express Platinum Cashback (check eligibility / apply*) charges a £25 annual fee, but has an intro 5% cashback rate on up to £2,500 of spending in the first three months (max £125 cashback).

After that, it gives 1% back on up to £10,000/yr and 1.25% above this – making this card a winner for bigger spenders. Cashback is paid to your account annually – in the month after your card anniversary date.

Note: You won't get the intro 5% rate if you've held a personal Amex card in the past two years.

Representative APR (variable): 27.3% APR incl fee (Official APR Examples)
Important: Repay IN FULL every month to avoid interest
Cashback: 5% in first 3mths (max £125), then once you've spent £2,500 or after 3mths (whichever's sooner) it's 1% on the next £10,000/yr, 1.25% above £10,000/yr
Annual fee: £25
Min income: 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 Preferred Rewards Gold

Trick to nab £184 in Nectar points or £100 M&S/Amazon vch or 23,000 airline/hotel points when you spend £3,000 within 3mths

Check eligibility

Apply*

The Amex Preferred Rewards Gold credit card (check eligibility / apply*) gives an intro bonus of 20,000 reward points if you spend £3,000 in the first three months. This is on top of the usual one point per £1 spent (making a total of 23,000 points). Amex says the points come within a month of hitting the trigger, but it usually only takes a couple of days. You can change them for:

- 36,800 Nectar points (worth £184). Amex doesn't advertise this, but there's a trick to manipulate the new British Airways and Nectar partnership: you need to swap your Amex points for BA points, which are called Avios (23,000 points = 23,000 Avios), then swap the Avios for Nectar points (23,000 Avios = 36,800 Nectar points) and hey presto... (see the FAQs tab for more on how to do this). You can spend these points at Nectar partners including Sainsbury's, eBay and Argos – see the Nectar website for the full list.

- A £100 voucher. Choose from retailers such as M&S and Amazon. This will use up 20,000 points, so you'll still have 3,000 left over.

- 23,000 airmiles/hotel points. Schemes include Avios, Virgin Red and Hilton Honors.

All cardholders also get two free visits per year to airport lounges.

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: You won't get the bonus if you've held a personal Amex card in the past two years.

Representative APR (variable): 56.6% APR incl fee (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: 0.8p if converted to Nectar points via Avios, 0.5p if converted to vouchers (airline/hotel scheme redemption values vary)
Points' expiry: N/A

  • What rewards can I get from this card?

    You can convert Amex Membership Reward points into gift cards for Amazon, M&S and more – though stores on the Amex rewards website do vary. Vouchers are sent either by post (allow 10 days for arrival) or digitally on the same day. Do check before converting your points whether it's a postal or digital gift card.

     

    Alternatively, you can convert Membership reward points into frequent flyer or hotel scheme points and add them to your current stash (transfers can take up to five working days).

     

    Additionally, you can now also convert them into Nectar points – though to do this, you'll need to swap them for Avios points first (more detail in the FAQ below).

     

    For full options, see the Membership Rewards site.

    Note: Bonus points can take a month to hit your account, but we've seen them applied on the day you hit the trigger.

  • How do I swap Avios for Nectar points, and vice versa?

    You can swap your Amex points for Avios (British Airways' points currency) at the American Express website.

     

    Once you've done that, in order to convert Avios to Nectar points and vice versa, you'll need to link your Nectar and British Airways Executive Club accounts, which can be done on either the Nectar or British Airways Executive Club website. If you're not currently a member of either scheme, these can both be joined for free.

     

    Next, you'll need to select the 'Convert your points' option on either site. You can also choose to convert your points automatically in either direction, so if you have a preferred points scheme, you won't need to manually switch points over in the future.

     

    The conversion rate is given by Sainsbury's as 250 Avios to 400 Nectar points. This means that Avios now have a set monetary value of 0.8p when converted to Nectar points. For example, if you've got 1,000 Avios, you can convert them to 1,600 Nectar points, worth £8.

  • 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 on two separate visits, or for yourself and a guest for one visit.

     

    Additional visits or guests cost £20 a time, which will be charged to your Amex.

  • 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 that year. Though remember, if you keep the card into a second year, you'll pay the £140 annual fee

     

    If you forget and cancel it before the year is up, you'll get a pro-rata refund.

     

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

     

    Plus if you have a friend who has the card, get them to recommend you, and they'll get 6,000 bonus points and you'll get 2,000 extra points – as long as you spend £3,000 within three months.

  • 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.

  • How are the gift vouchers sent?

    Gift cards are sent by post (within 10 working days of redemption) or by email on the day you redeem if it's a digital gift card.

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Amex Nectar

Earn 24,000 Nectar points, worth £120 at Sainsbury's/Argos/eBay, when you spend £2,000 within 3mths

Check eligibility

Apply*

Spend £2,000 on the Amex Nectar card (check eligibility / apply*) within the first three months, and you'll get 20,000 bonus Nectar points, on top of the usual two Nectar points per £1 spent you get with this card. So hit the spending trigger and you'll end up with at least 24,000 points, worth £120 at Nectar retailers such as Sainsbury's, Argos and eBay. Points will usually be credited to your Nectar account within a month of hitting the trigger.

Alternatively, you can now convert Nectar points to Avios, which you can spend on flights, hotel and car hire (see FAQs tab for more details).

The card has a £25 annual fee that kicks in from year two, so diarise to cancel before then if you don't want to pay it. 

Note: You won't get the bonus if you've held a personal Amex card in the past two years.

Representative APR (variable): 27.3% APR incl fee (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 at Nectar partners
Points' expiry: One year if you don't collect or spend any points

  • Where are Nectar points worth more?

    Usually one Nectar point is worth 0.5p, but occasionally some retailers give better offers (see Loyalty Schemes for more info).

  • How do I swap Nectar points for Avios?

    In order to convert Nectar points to Avios and vice versa, you'll need to link your Nectar and British Airways Executive Club accounts, which can be done on either the Nectar or British Airways Executive Club website. If you're not currently a member of either scheme, these can both be joined for free. 

     

    Next, you'll need to select the 'Convert your points' option on either site. You can also choose to convert your points automatically in either direction, so if you have a preferred points scheme, you won't need to manually switch points over in the future.

     

    The conversion rate is given by Sainsbury's as 250 Avios to 400 Nectar points. This means that Avios now have a set monetary value of 0.8p when converted to Nectar points. For example, if you've got 1,000 Avios, you can convert them to 1,600 Nectar points, worth £8.

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

Amex Rewards

Earn 5,000 bonus Rewards points for spending £2,000 within three months. Spend 'em on a £25 Amazon/M&S vch or swap 'em for Nectar pts, or airmiles/hotel pts

Check eligibility

Apply*

If you won't hit the spending trigger on the Gold card above, Nectar pts aren't your thing, or you want a card that's fee-free all the time, this could suit you better. Spend £2,000 on the Amex Rewards credit card (check eligibility / apply*) in the first three months and you'll get 5,000 bonus points, on top of the usual one point per £1 spent – so you'll have a total 7,000 points. You can change them for:

- A £25 voucher. Choose from retailers such as M&S and Amazon.

- 7,000 airmiles/hotel points. Schemes include Avios, Virgin Red and Hilton Honors.

- 11,200 Nectar points (worth £56). To do this, you need to swap your Amex points for Avios, then swap the Avios for Nectar points (see FAQs tab for more details).

Note: You won't get the bonus if you've held a personal Amex card in the past two years.

Representative APR (variable): 22.2% APR (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: 0.8p if converted to Nectar points via Avios/0.5p if converted to vouchers (airline/hotel scheme redemption values vary)
Points' expiry: N/A

  • What rewards can I get from this card?

    You can convert Amex Membership Reward points into gift cards for Amazon, M&S and more - though stores on the Amex rewards website do vary. Vouchers are sent either by post (allow 10 days for arrival) or digitally on the same day. Do check before converting your points whether it's a postal or digital gift card.

     

    Alternatively, you can convert Membership reward points into frequent flyer or hotel scheme points and add them to your current stash (transfers can take up to five working days).

     

    Additionally, you can now also convert them into Nectar points - though to do this, you'll need to swap them for Avios points first (more detail in the FAQ below).

     

    For full options, see the Membership Rewards site.

    Note: Bonus points can take a month to hit your account, but we've seen them applied on the day you hit the trigger.

  • How do I swap my Avios for Nectar points, and vice versa?

    You can swap your Amex points for Avios on the American Express website.

     

    Once you've done that, in order to convert Avios to Nectar points and vice versa, you'll need to link your Nectar and British Airways Executive Club accounts, which can be done on either the Nectar or British Airways Executive Club website. If you're not currently a member of either scheme, these can both be joined for free. 

     

    Next, you'll need to select the 'Convert your points' option on either site. You can also choose to convert your points automatically in either direction, so if you have a preferred points scheme, you won't need to manually switch points over in the future.

     

    The conversion rate is given by Sainsbury's as 250 Avios to 400 Nectar points. This means that Avios now have a set monetary value of 0.8p when converted to Nectar points. For example, if you've got 1,000 Avios, you can convert them to 1,600 Nectar points, worth £8.

  • 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.

See how likely it is you'll get this card

MSE's Eligibility Calculator

Or just go straight to the lender

Apply*

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Top non-Amex reward credit cards

As we say above, the top-paying cards are all from American Express. But if you already have an Amex and don't qualify for the bonuses, can't get an Amex, or need a back-up for when it's not accepted, there are a few decent options – mainly from supermarket chains. They give the best returns when used at those stores, but do give some points if used elsewhere.

Sainsbury's Bank 

Nectar members only. Earn 10,000 bonus Nectar points worth £50 at Sainsbury's/Argos/eBay

Apply direct to lender

With the Sainsbury's Bank Nectar Reward card (apply, it's not in our eligibility calculator), you can earn Nectar points on all purchases. Plus, spend £400+ at Sainsbury's, Argos or Tu Clothing in the first two months and you'll get 10,000 bonus Nectar points, worth £50.

The points will be credited to your Nectar account 60 days after the end of the two-month period. You can spend them at Sainsbury's and at Nectar partners, eg, Argos, and you can also now swap Nectar points for Avios (at a rate of 400 Nectar to 250 Avios) which means you can put them towards flights etc.

You'll only be able to apply for this card if you've had a Nectar card for six months or more. You could also get up to 17 months 0% on spending (some poorer credit scorers will get 14 or 12 months 0%), but only use this if you're disciplined and can fully repay within the 0% period.

It's also worth looking at the Amex Nectar card, which offers a 20,000 Nectar-point intro bonus and ongoing points, as it could be a better option.

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 at Nectar partners
Points' expiry: None unless account is closed

Apply direct to lender

M&S Bank CC front

M&S Bank

£30 in bonus cashback/M&S vouchers, plus ongoing points 

Check eligibility

Apply*

Accepted new M&S Bank cardholders (check eligibility / apply*) can get up to £30 in bonus cashback and points, which convert to M&S vouchers. There are two elements to this:

- £25 cashback. Apply by Fri 19 Mar and spend at least £100 within 90 days (though don't make this an excuse to overspend), and you'll get £25 cashback applied to your card within 30 days.

- £5 in M&S points. You're sent a coupon to collect 500 points on one purchase at M&S (no min spend).

You'll also get one point for every £1 spent at M&S, and one point for every £5 spent elsewhere. You can spend points at M&S at a value of 1p per point. Points are converted to M&S vouchers and sent to you by post every three months.

The card also offers a near market-leading 18mths 0% on new spending too, so it's a good choice if you NEED to borrow for a planned, affordable buy (eg, a new fridge) – as done right it is interest-free.

If you're using it for the 0%, always pay at least the min monthly payment, and clear the debt before the 0% ends or it's 19.9% rep APR.

Representative APR (variable): 19.9% APR (Official APR Examples)
Important: Repay in full before end of 18mth 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): One per £1 spent in M&S, one per £5 spent elsewhere
Value of one point: 1p at M&S
Points' expiry: Two years

  • When will I get my vouchers?

    Points-related vouchers are credited to your account within 30 days of your first purchase and will be sent in your next available quarterly reward mailing.

  • Can I get it if I've had an M&S card before?

    You can't get the card if you're an existing M&S Credit Card-holder or if you've held a credit card with M&S Bank within the past 12 months.

  • Is there a 0% spending period?

    There's an 18 month 0% period on spending with the card, a nice bonus, but don't feel you need to use it. If 0% spending is what you're looking for, see our 0% Spending guide for all the best buys.

  • Are there any exclusions?

    You won't get the £5 (500 bonus points) if you use your voucher to spend on tailoring alterations, 'Made to Measure' shirts, 'Your School Uniform' service, name tapes, personalised cards, Lunch to you, Wine Club, restaurants, deli bars, M&S Café or branded food goods.

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? Other reward cards

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

Card Rewards Value of one point  Rep APR†
Amazon
Apply direct to lender

- Free £20 voucher to spend on Amazon

- 0.75 points per £1 spent at Amazon (1.5 points for Prime members)

- 0.25 points per £1 spent elsewhere

 1p 21.9%
Tesco 
Check eligibility / Apply*

- 1 point per £4 at Tesco (on top of the usual point per pound spent)

- 1 point per £8 elsewhere 

 1-3p (See how to boost points) 20.9%

†If not repaid. Representative variable APR, your interest may be different.

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.

Coronavirus credit card help

If you're struggling to pay off debt on an existing credit card due to coronavirus, lenders should provide support. What's available depends on whether you've already had help:

  • • If you've already had payment holidays totalling six months, contact your lender to discuss your options.

    Help is still available and will be tailored to your circumstances. You could be offered a (further) payment holiday or a period of reduced payments, reduced interest or a repayment plan – providers should take into account what you can afford and how your finances are likely to change in the near future.

    Providers are expected to report any support they give you to credit reference agencies, which could affect your future creditworthiness. Yet don't let that put you off from contacting your provider – missing payments or defaulting is likely to have a far worse impact.

  • • If you've had no help, or a break from payments less than six months, you can apply for a payment holiday.

    Under the latest rules from the Financial Conduct Authority, you can apply for a payment holiday of up to six months if you've not had any help to date, or to 'top up' to a total of six months if you've already had payments paused.

    However, you'll still be charged interest, so it's likely to cost you more in the long run. And while these payment holidays won't be reported as missed payments on your credit file, there are other ways for lenders to find out about them. But don't let that put you off from applying for a payment holiday if you really need one – missing payments without agreeing it with your provider first is likely to have a far worse impact.

For the latest updates and full information on the support available, see our Coronavirus Finance & Bills Help guide.

Reward cards Q&A

  • 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.

    But be aware of using PayPal to pay on a credit card, as you'll lose this valuable Section 75 protection. Read the full guides to Section 75 refunds and using PayPal to pay on a credit card.

  • 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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