Money Insider: Amazon gets in the Christmas spirit early

There has been a distinct lack of activity from credit card providers launching new rewards or cashback-related plastic this year. With tough economic conditions and unemployment biting hard, it's not surprising that lenders are placing more emphasis on monitoring their existing book and managing increasing numbers of customer defaults.

That's why the announcement that Amazon.co.uk has teamed up with MBNA to issue a new rewards credit card caught my attention this week.

With Christmas a mere 76 days away it is a timely launch, especially as the offer includes the carrot of a £15 freebie in return for your first purchase. Spending on the card at Amazon.co.uk gives you Amazon reward points at an equivalent return of 1 per cent of your spend but using the card elsewhere attracts a less competitive 0.5 per cent reward rate.

The card offers 0 per cent interest on Amazon purchases for 9 months and 0 per cent on balance transfers for 12 months, but once the promotional rate expires a below-average APR for purchases of 16.9 per cent kicks in.

It's worth a look but, as with all cards that offer cashback or rewards points, it's only worth considering if you pay your credit card balance in full every month, otherwise the interest you incur will more than wipe out any benefits you've accrued.

If it's a cashback credit card rather than rewards you're looking for then the World Money MasterCard from Egg offers 1 per cent wherever you spend with a maximum rebate of £200 per annum. The Egg card does have a £1 monthly fee, but if you're a frequent user of plastic, it can still give you a decent net return.

Mortgage battle simmers

In a week when the Halifax reported an average house price increase of 1.6 per cent for September, the big mortgage players continued to show their competitive streak with some new deals.

On Wednesday, Abbey trimmed its homebuyer fixed rate mortgages by up to 0.11 per cent, with a two-year fix now 3.88 per cent, and a three-year fix now 5.88 per cent, both with a £995 fee. However, with increased speculation that base rate will remain subdued, it's trackers and discounted home loans that are back in vogue.

The pick of the changes from Woolwich announced on Tuesday was a 0.45 per cent cut leaving its tracker now standing at 2.79 per cent (base plus 2.29 per cent) with a fee of £999. There is also a fee-free version at 3.19 per cent. If you're in doubt which would be the best option for you, speak to a professional mortgage adviser who'll crunch some numbers for you.

Andrew Hagger is a money analyst at Moneynet.co.uk

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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