Egg card offers cashback on sales online – but be wary of the rate

Internet bank Egg is to launch a new credit card offering borrowers cashback on purchases made online at more than 1,500 UK retailers. The Egg Visa card gives users free membership of online cashback discount store Quidco, which in turn offers money off items bought from some of the UK's big-name retailers, including Marks & Spencer, Holland & Barrett, Dell and iTunes.

Cashback, which through Quidco can be as high as 10 per cent of the purchase price, is then credited to the account of the customer's choosing each month. In addition, purchases made with the card have added protection, such as a refund if items ordered online are faulty or do not arrive. "The idea is to give consumers complete peace of mind when ordering online. Good retailers will offer protection already but we are adding to that," says Harald Schneider, head of Egg cards. "We have always been pioneers online, and retail spending is growing massively over the internet. This card keys into the zeitgeist that consumers want a better deal and are looking online for the best possible price in these thriftier times."

Borrowers with debt to transfer will be cheered by the fact that the Egg card comes with a 0 per cent balance transfer charge until August 2011. However, those who run up balances on their card need to be aware that the interest rate is 17.9 per cent. "This is a quite high rate; the truth is that any benefits you get from the online cashback will soon be eaten up if you leave money on the card for any length of time. Best advice is use the cashback but always pay back the balance each month," says Andrew Hagger from comparison service Moneynet.co.uk.

What's more, the rate on the new card is actually 1 per cent higher than the standard Egg Visa that it replaces.

"This little nasty was hidden away," says Michelle Slade from financial information provider Moneyfacts. "It seems that the 'freebies' are being at least part funded by a rate increase. Even the balance transfer deal is not all it's cracked up to be as customers can find longer-term deals on the market at present."

Ms Slade also points out that the Egg card has just a 2 per cent minimum monthly repayment. "Most cards typically ask for 2.25 per cent. Now this may not seem like a big deal, but if you have a large balance and just make the minimum repayment, under the Egg card's structure you will pay much more," she says. For example, spend £5,000 on the new Egg card and make only the minimum repayment and you will repay a total of £10,124 and take a staggering 45 years before being debt free. "No one is going to do this, but it is a warning to clear balances quickly," adds Ms Slade.

Nevertheless, regular online shoppers may be tempted by the free access to the Quidco site offered – normally costing £5 – and the fact that cashback is paid monthly into their account. "There are no vouchers or loyalty-card points that need redeeming. Our card structure means consumers can enjoy not just great savings on their shopping from top retailers, but also cashback," Mr Schneider says.

"If you like online shopping and you use the retailers that are on the Quidco site, then cashback is attractive," adds Mr Hagger. "The key, though, is not to spread your cashback and loyalty too thinly, and to use lots of different cards and sites. Focus on cards which give you cashback at the retailers that you are likely to use the most."

Suggested Topics
Voices
voices
News
general electionThis quiz matches undecided voters with the best party for them
Life and Style
Men with beards rejoice: Your beard probably doesn't harbour faeces-like bacteria
health
Arts and Entertainment
Keira Knightley and Matthew Macfadyen starred in the big screen adaptation of Austen's novel in 2005
tvStar says studios are forcing actors to get buff for period roles
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Trainee Consultant - Surrey/ South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Ashdown Group: Trainee Consultant - Surrey / South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Recruitment Genius: Claims Administrator

    £16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

    Recruitment Genius: Senior SEO Executive

    £24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

    Day In a Page

    Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

    Fishing is on Nigel Farage's mind

    Ukip leader casts a line to the disaffected
    Who is bombing whom in the Middle East? It's amazing they don't all hit each other

    Who is bombing whom in the Middle East?

    Robert Fisk untangles the countries and factions
    China's influence on fashion: At the top of the game both creatively and commercially

    China's influence on fashion

    At the top of the game both creatively and commercially
    Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

    The man known as GOD has a reputation for getting the job done

    Lord O'Donnell's three principles of rule
    Rainbow shades: It's all bright on the night

    Rainbow shades

    It's all bright on the night
    'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

    Bread from heaven

    Dutch survivors thank RAF for World War II drop that saved millions
    Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

    How 'the Axe' helped Labour

    UK will be 'run for the wealthy and powerful' if Tories retain power
    Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

    The price to be paid for challenging the rule of extremists

    A revolution now 'consuming its own children'
    Welcome to the world of Megagames

    Welcome to the world of Megagames

    300 players take part in Watch the Skies! board game in London
    'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

    Charlotte Gainsbourg on 'Nymphomaniac'

    Starring in one of the most explicit films ever
    Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

    Robert Fisk in Abu Dhabi

    The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
    Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

    Vince Cable exclusive interview

    Charging fees for employment tribunals was 'a very bad move'
    Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

    Iwan Rheon is returning to his Welsh roots

    Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
    Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

    It's time for my close-up

    Meet the man who films great whites for a living
    Increasing numbers of homeless people in America keep their mobile phones on the streets

    Homeless people keep mobile phones

    A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before