Use our guide to the top ten best rewards credit cards to find the right card for your spending and get the most appropriate rewards for you.
Top Ten Rewards Credit Cards
|Rewards credit card||APR||Annual fee||What are the rewards?||What do points mean?||Balance transfers||Why we like it||What to watch out for|
|Sainsbury's Bank Nectar Reward Card||20.90%||None||2 points for every £1 on fuel or shopping. 1 point for every other qualifying £5 elsewhere. 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||0.5p at Nectar partners||0% interest on balance transfers for up to 28 months, 2-3% fee depending on circumstances||Excellent way to build up Nectar points and a growing number of places are part of the Nectar system||Need to have been a Nectar member for six months. Nectar points are worth less than many competitors' rewards|
|Tesco Bank 12 month all round credit card||19.90%||None||1 Tesco Clubcard point for every £1 spent at Tesco and for every £8 spent elsewhere||One point = 1 pence. You can increase this value up to 3p by spending with Tesco reward partners||0% interest for 12 months on balance transfers. No balance transfer fee||Tesco's reward card is a good option across the board, and the zero fee on balance transfers makes it worth a look||You need to be a Tesco shopper to get the most out of this card|
|HSBC Rewards Credit Card||21.90%||None||1 point for every £5 eligible spend. Get 2,500 welcome points worth £25 when you make your first transaction.||100 points = £1 (to be spent using Rewards App)||0% on balance transfers for six months||Really flexible allowing points to be exchanged for every day purchases||You need to have an HSBC Advance Bank Account (or have paid a total of £1750 a month into an HSBC UK Bank or Premier Account over the last 6 months).|
|M&S Credit Card Reward Plus Offer||19.90%||None||1 point for every pound spent at M&S. 1 point for every £5 spent elsewhere. 500 bonus points for first shop spent on card at M&S. Double M&S points on all in store shopping for first 12 months||100 points = £1 reward voucher||0% on balance transfers for 6 months, available for 90 days from account opening (2.9% fee applies, minimum £5)||Great deal for the first year||To get the best form this card you need to be an M&S shopper|
|RBS Reward Credit Card||26.80%||£24||1% in Rewards for your spend at the supermarket. 1-15% in Rewards when you shop at MyRewards retailers. Get 0.25% in Rewards for all your other spending, including at supermarket petrol stations||Varies on Rewards wallet app||Not specified||Simple to understand and borrowers are not beholden to any particular stores||The annual fee is off-putting, but if you already have a Reward current account, you'll get the fee refunded|
|Amex Platinum Everyday Cash Back||22%||None||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.||Points can be transferred to a range of programmes offered by Amex partners||Not specified||Best credit card for cash back rewards if you spend less than £10,000||You must spend at least £3000 if you want to get any cash back at all|
|Amex Gold credit card||56.60%||£140 but £0 in first year||1 point for every £1 purchase, 2 points for every pound spent with airlines and foreign currency, three points for every £1 spent at Amex travel. If you spend more than £15k in any year you receive 10,000 points.||Points can be transferred to a range of programmes offered by Amex partners||Not specified||Very broad range of ways to earn points, great for travellers||Very high APR and annual fee.|
|NatWest Reward (Mastercard)||26.80%||£24 (unless you are a reward current account holder)||1% rewards on supermarkets and 0.25% at petrol stations. 1% on selected retailers||Cashback||0% for 18 months from account opening on balance transfers made within the first 3 months, after which standard rates apply. No fees||Decent range of opportunities to build up rewards and cash back||The annual fee is off-putting unless you already bank with NatWest|
|Santander||£3 a month||0.5% cashback on all your purchases, no foreign transaction charges||Cashback||0% interest on balance transfers for 26 months from account opening with no balance transfer fee||Very straightforward and the lack of foreign transactions charges sets it apart||Must be earning at least £7500 annually. The range of rewards is rather limited|
|BA AMEX||22.20%||none||1 Avios for every £1 spent. 5000 bonus Avios when cardholder spends £1000 in first three months||Avios points are exchange for flights. Values vary||N/A||Generous bonus for spenders in the first few months||Limited to BA|
What are Rewards Credit Cards?
Rewards credit cards are credit cards that reward you for using them by giving you benefits, gifts and vouchers. For every pound you spend you get a reward that differs depending on the credit card.
How do Rewards Credit Cards work?
Getting paid for spending money sounds too good to be true, but that is exactly what rewards credit cards promise.
Lenders offer points in returns for borrowers spending certain amounts in particular stores on or on specific items. For example, many of us are familiar with the Tesco Club Card. If you use a Tesco credit card you can earn even more points than you would by simply using the standard club card.
Reward credit cards are not limited to the supermarkets and retailers. Many High Street banks also offer cash bank and bonuses for using their cards, as do airlines and hotels.
What is the downside of using a Rewards Credit Card?
However, there is no such things as a free lunch and rewards credit cards come with several conditions.
First, they tend to have high APRs, and the more generous the reward programme the higher the APR. This means reward cards may only be suitable for those who can repay their balance at the end of every month.
Second, reward cards are typically designed to encourage you to spend in one place or to spend more. Borrowers need to be disciplined to avoid overspending or buying items they might not have needed or wanted without the reward incentives. For example, Amazon now offers a reward credit card which promises a £20 voucher on approval to spend at Amazon. Borrowers then receive 75 points per £100 spent at Amazon (150 points for Prime members) and 25 points per £100 spent elsewhere. This is positive for regular shoppers, particularly those making lots of smaller purchases who are not rewarded at present, but it could also encourage overspending online.
Third, you need to be aware of when you will receive your rewards. Some cards may pay out monthly, quarterly or annually.
How to choose the best Rewards Credit Card?
Good Money Guide has reviewed a range of reward cards on the market and listed our top ten. However, some of the major supermarket rewards cards have not made it onto the list. If you are a regular shopper at a store not listed here, it may be worth looking at their credit card ahead of some of these. The same is true if you have a bank account which offers a rewards credit card; it could make sense to investigate your bank’s reward card instead of ones from other lenders.
Additionally, if you are a regular traveller, it is worth looking at the rewards credit cards offered by hotels and airlines. For example, the Marriott Bonvoy reward card (Amex) offers 2 Bonvoy points for every £1 spent and 6 points for every £1 spent at Marriott, which can be exchanged for money off overnight stays. However, with an APR of 38.8% and annual fee of £75, this is probably for loyal guests only.
Similarly, the BA Premium card pays out 1.5 Avios points for every £1 spent in general, and three Avios for every £1 spent with BA. And borrowers can collect a 25,000 bonus if they spend £3000 in first three months. But with an eyewatering 74.7% APR, this is most likely only suitable for BA’s most frequent flyers.