Santander has ditched its cashback-paying 123 credit card for new customers, replacing it with the new lower-paying All in One card.
For a £36 annual fee, the 123 card offers 1% cashback on supermarket spending, 2% at department stores and 3% on petrol, diesel and train tickets - capped at £3/month for each category of spending.
It was closed to new applications yesterday (4 October), though existing cardholders can continue to use it with exactly the same benefits.
The new All in One card offers a flat cashback rate of just 0.5% on all spending – but there's no maximum cap on what you'll earn. Like the 123 card, it has a £36 annual fee.
Santander has also relaunched its Zero travel credit card with no foreign transaction or cash withdrawal fees and renamed its eponymous Santander card the Everyday card. Neither offers customers any cashback.
The bank's decision to cut cashback rates on credit cards comes weeks after it halved the headline interest rate on its popular 123 current account.
How does the new All in One card stack up?
With a cashback rate of just 0.5% and a hefty annual fee, we won't be adding the All in One card to our Cashback Credit Card Best Buys any time soon. Rates of up to 5% are available on rival cards – some of which are fee-free.
However, the All in One does offer a 0% balance transfer period of 40 months and has no foreign transaction fees. Its representative APR is 21.7%
But while its predecessor the 123 card has better cashback rates, that doesn't mean it's a winner. It used to be a top pick for those with the 123 current account, but lost its edge when Santander hiked its annual fee by 50% and capped cashback amounts last year.
What does Santander say?
Matt Hall, director of credit cards at Santander, says: "We are refreshing our credit card range to make it more attractive and meet a wider range of customers' needs.
"Customers can now benefit from unlimited cashback, longer introductory 0% balance transfer periods and fee-free foreign transactions depending on which credit card they choose. There's something for everyone, depending on what type of spender they are."