Rewards Credit Cards

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Rewards credit cards provide rewards for using your credit card, allowing you to earn and redeem points for benefits such as flights, shopping vouchers and gifts, and other types of reward such as cash back – all for spending on your credit card. These credit cards are suitable for customers who spend often on their cards, usually repay their monthly balance in full, keep their account in good order, have a good credit rating and enjoy the type of rewards that are available. If you are this type of cardholder you could find a rewards credit card to suit your spending and enjoy all the benefits and perks.

Credit Card Offer Balance Transfer purchase Intro standard purchase
rate duration fee rate duration (variable)

American Express Platinum Cashback Credit Card

Earn cashback on virtually all your purchases.

Representative Example: The annual purchase rate is 18.5% p.a.(variable) so if you spend £1,200 your representative APR will be 18.5% p.a. variable% variable.

-% - months -% -% - months 18.5%

 

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American Express Starwood Credit Card

Earn Starpoints as you spend.

Representative Example: The annual purchase rate is 19.9% p.a.(variable) so if you spend £1,200 your representative APR will be 34.5% p.a. variable% variable.

-% - months -% -% - months 19.9%

 

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British Airways American Express Credit Card

Earn Avios points as you spend & pay no annual fee. Complimentary insurance & companion ticket.

Representative Example: The annual purchase rate is 19.9% p.a.(variable) so if you spend £1,200 your representative APR will be 19.9% p.a. variable% variable.

-% - months -% -% - months 19.9%

 

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British Airways Premium Plus American Express Credit Card

Earn 1.5 Avios points per £1 spent. Get 18,000 bonus Avios points when you spend more than £3,000.

Representative Example: The annual purchase rate is 19.9% p.a.(variable) so if you spend £1,200 your representative APR will be 50.1% p.a. variable% variable.

-% - months -% -% - months 19.9%

 

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American Express Preferred Rewards Credit Card

1 Membership Rewards point per £1. Get 20,000 bonus points for spending £1,000 in first 3 months.
-% - months -% -% - months -%

 

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Our Overview of Rewards Credit Cards

If you like to spend often on your credit card and regularly repay the balance, a rewards credit card could be the perfect choice. Rewards credit cards provide different benefits depending on the scheme they link to, but generally work by earning point each time you spend on your card. You earn on each £1 you spend, and often have the chance to earn bonus points when you spend at specified program partners.

Some rewards cards are aimed particular types of spending, such as store shopping cards or those that provide membership to frequent flyer programs or have rewards geared towards motorists.

Between the various rewards programs on the UK credit card market you can choose between a huge variety of rewards including flights and other travel-related benefits, shopping vouchers and gifts, meals at restaurants, family days out, leisure and entertainment, financial services and many other products and services.

Another type of reward is cash back, which is either in the form of points earned for cash back, or as a percentage paid back into your account on credit card purchases.

When you are comparing what’s available you should find a scheme that earns points on your normal spending habits, and that the rewards available are products and services you can make use of. Rewards schemes often feature restrictions such as point capping and expiry, so make sure you know exactly how the scheme functions so you can get the most out of your points.

You should also take a look at annual fees, which shouldn’t be so high as to outweigh the benefits of the rewards, and the interest rates. If you clear your balance in full each month you can avoid paying interest on purchases; if you are likely to have an ongoing balance on your account the interest can negate the rewards you earn. It’s also worth considering other credit card features such as balance transfers, insurance policies and other perks that may be included in the package.

If you can find a rewards credit card that fits in with your financial habits and lifestyle with competitive rates and fees, it can be a great way to earn rewards for spending on your card.

Tips for Using Rewards Credit Cards

Spend often on your credit card: To get the most out of a rewards scheme you need to be spending often on your credit card, collecting plenty of points and redeeming for rewards. You should not overspend or make purchases just for the sake of earning points; instead you should make all your normal purchases, bill payments and other transactions that earn points using your card. If you budget to repay all these purchases on your monthly bill, you can earn rewards on your usual everyday expenditure.

Make use of your points: Loyalty programs often have restrictions on points capping and expiry, meaning there is a limit on how many points and rewards you can earn and how long your points are valid. Your rewards scheme membership may also expire if your account is inactive for a certain period of time. Make sure you are aware of all the rules in the terms and conditions so you can get the most out of the points that you earn.

Earn bonus points: Many rewards cards offer bonus points when you join the scheme or when you spend with program partners. Take a look at where you can earn extra points and see if it fits in with your spending habits. Again, you shouldn’t make purchases for the sake of earning points, but instead identify how you can get bonus points on your normal expenditure.

Repay your monthly balance in full: You get the most out rewards credit cards when you maintain your account in good order and keep the costs of using your credit card to a minimum. If you are paying large amounts of interest on your balance you negate the savings and benefits of the rewards scheme, so it is always best to pay your monthly balance in full and avoid paying the purchase rate.

Avoid cash advances: The cash advance rate on a rewards credit card is generally higher than the purchase rate, the interest is applied as soon as the transaction is made and cash transactions generally do not earn reward points. For these reasons it is always best to avoid cash transactions.

Common Features of Rewards Credit Cards

Rewards scheme: Reward credit cards provide membership to different rewards schemes, each designed for certain types of spending and reward redemption. When you are selecting a reward credit card ensure that the program suits your normal spending habits and offers rewards that you want to use.

Points earning, redeeming, capping and expiry: Rewards programs feature rules and regulations regarding how points are earned, redeemed, capped and expire. Take a look at how many points you need to earn for the rewards you want to make sure you are getting value for money, and that the rules on capping and expiry are not too restrictive.

Bonus points: Bonus points, either upon signing up to the card, starting your membership or when you spend at the program partners, are often available. It’s great to make use of bonus point offers, but make sure the scheme’s standard point earning is genuinely rewarding.

Annual fee: Reward credit cards often feature an annual fee. This yearly charge should not be so large that it negates the benefits of the rewards scheme.

Standard purchase rate: This is the rate of interest applied to purchases made on your credit card. While it’s best to aim to pay off your monthly balance and avoid paying the interest, it is an important consideration since any ongoing balance on your account starts attracting interest at this rate. Typically credit cards with rewards generally have ongoing purchase rates roughly in line with the market average or slightly higher.

Cash advance rate: This is the rate of interest applied to cash transactions such as ATM and bank branch withdrawals and buying foreign currency. This rate tends to be higher than the purchase rate and is applied as soon as the transaction is made. Note that cash advances are not generally rewarded.

Cash advance fee: This is the fee applied to cash advances, typically 3% of the total value of the transaction.

Insurance policies and other perks: Credit cards with reward programs, particularly gold and platinum cards, often feature perks such as purchase protection, refunds and travel insurance. Extra benefits may include concierge services, airport lounge access and other services. While these extras are described as complimentary, they are often associated with higher fees and interest rates, so it is important that the insurance gives you the right kind of protection and the other benefits suit your lifestyle.

Examples of Using Rewards Credit Cards

Frequent flyer: If you travel often for business or leisure, choose a card that provides membership to a frequent flyer program in which you can earn and redeem points for flights and other travel services. This kind of program can help reduce your travel expenses, saving money and providing access to other benefits such as concierge service, airport lounges and priority seats. However, you should only sign up for a card linked to an airline you actually can use easily and services the destinations you need to go to for leisure or business.

Big spender: If you spend often on shopping you should be able to find a credit card that rewards you for your normal purchases. This may be in the form of cash back on all your purchases, points on purchases and bonus points for shopping with certain retailers. Most of the UK’s big supermarket chains have some sort of rewards program linked credit card, so you can earn and redeem points on your weekly groceries, saving money on your usual spending.

Rewards Credit Card Glossary

Annual fee: This is a yearly charge that covers the maintenance of your credit card account. While rewards credit cards usually provide free membership to the rewards scheme, it isn’t unusual for them to charge a relatively high annual fee.

Frequent flyer points: These are points earned on rewards schemes aimed at cardholders who travel often, allowing points to be redeemed for flights and other rewards. These points are also known as air miles, or other names specific to each rewards scheme, for example, Virgin Flying Club miles.

Purchase protection: This is a form of insurance designed to protect the items you purchase using your card. This may include cover against loss, theft and accidental damage, refunds and extended warranties.

Rewards program: These are loyalty schemes that provide incentives for customers to use their card. Generally, rewards programs work by earning points when purchases are made on a credit card, and the points are then redeemed for rewards. The way that points accumulate and the type of rewards that they can be redeemed for varies greatly between different schemes.

Travel insurance: Rewards credit cards often provide travel insurance when you book travel-related services using your card. This cover may include insurance against lost luggage, missed flights, medical and legal fees while travelling. If your rewards card does provide travel insurance, ensure you know exactly what is covered and that you have the appropriate type of protection.