Personal Finance: Cards splash out on big spenders

GONE are the days when you thought yourself lucky if the bank kindly offered you a credit card for pounds 12 a year. The new Alliance & Leicester Gold MoneyBack card launches tomorrow and A&L pays you to use it. The bank is offering between 50p and pounds 4 cash back (depending on where you spend the money) for every pounds 100 you spend. A&L is hoping to attract plenty of affluent customers (earning pounds 20,000 or more per year) who plan to hit the January sales using their new cards.

If you use the credit card a lot, and pay off your bills in full each month, you could earn enough to receive a cheque for hundreds of pounds at the end of 1999.There's no annual fee and the APR is 9.4 per cent on transferred balances, and 17.4 per cent for all new spending.

Most credit cards pay you back pounds 1 worth of points or cash for every pounds 100 spent. The most successful of this new breed is Goldfish. These cards are held by more than 800,000 people, who get vouchers for money off gas bills, or discounts off shopping at Boots or Asda stores.

Nevertheless, around 85 per cent of cardholders do not bother to redeem loyalty points from their credit card. The Bradford & Bingley building society withdrew its perks scheme earlier this year after the cost of running it proved greater than the benefits it was offering to customers, few of whom collected their bonus points anyway. Goldfish claims its easy claims system means more than half its customers redeem their points.

American Express has joined A&L in offering straight cash-back deals to customers - who automatically get a cheque (A&L) or money credited to their account (AmEx Blue). The standard A&L MoneyBack card is a good deal if you don't qualify for the new Gold card (see box above). American Express is more expensive (19.5 per cent APR against A&L's 17.4 per cent) and also charges pounds 12 a year.

Cash-back deals are also useful if you want to give money to your favourite charity. Dedicated cards usually pay 25p to the chosen charity for every pounds 100 you spend. You can boost this to 50p-pounds 4 per pounds 100 by using the A&L card and then redirecting the cash to charity.

Sainsbury's offers a good deal - all spending in-store on the supermarket's Visa card attracts double Reward points (see box on the left).

Some cards collect points towards a specific product, and these can offer a higher return. Around 600,000 GM Card users collect points and earn money back on a new Vauxhall car. The return is higher than most other cards at 3 per cent, so spend pounds 1,000 and you will get a pounds 30 discount. Since launch in 1994, some 84,000 cars have been bought through the scheme.

The UK's most popular credit card, Barclaycard, has a less attractive Profile points scheme. This allows you to collect towards a range of products, earning one point for every pounds 10 you spend on your card. You have to spend tens of thousands of pounds to get something worth having: a Sony Walkman costing pounds 50 in the shops is available for 1,250 Profile points, which means spending pounds 12,250 on your card. Not much of a deal.

Contacts: A&L MoneyBack (Standard, Gold), 0800 838383; American Express Blue, 0800 700111; GM Card, 0345 462777; Goldfish, 0345 609060; Sainsbury's, 0500 405060.

rewards for spending pounds 1,000

Card Cash/ APR% Return

points (1st 6 months) per pounds 1,000

GM Card Points for 20.8%(12.9) pounds 30**

No fee rebate

AmEx `Blue' Cash 19.5%(9.9) pounds 10

pounds 12

A&L `MoneyBack' Cash 17.4%(9.4*) pounds 5-pounds 40***

(Standard and Gold)

No fee

*Introductory offer on transferred credit card balances only.

**Rebate on Vauxhall car only.

***A&L Gold Card (launches 4.1.99) rebates up to pounds 40 per pounds 1,000 spent. Cardholders must earn pounds 20,000 or more.

the supermarket card boom

More than 13 million Sainsbury's Reward Cards have been issued since June 1996. The card earns one point for every pounds 1 you spend in its supermarkets, petrol stations and Savacentre stores. Collect 250 points and you will get one pounds 2.50 voucher, a 1 per cent return, although special offers can bump this up; you might get 40 points on a jar of pickled onions worth pounds 2.99.

With one Sainsbury's Reward voucher you can get pounds 5 off a meal for two adults at TGI Fridays, Beefeater and Brewers Fayre restaurants.

One Reward voucher can be exchanged for 40 Air Miles or pounds 2.50 off your Sainsbury's bill.

Credit cards issued by Sainsbury's Bank earn two Reward points for every pounds 1 spent in its stores, falling to one point for money you spend elsewhere.

Tesco's Loyalty Card also gives you a point for every pounds 1 spent, with special offers on top. For example, there are extra points when buying petrol and on various promotions. Tesco says the average customer gets pounds 10 in money-off vouchers every quarter.

You can also collect points on the Boots Advantage Card, which can be redeemed in the store, although certain products including prescription medicines are excluded from the scheme. Spend pounds 10 and you will get the equivalent of 40p in points, a 4 per cent return, which is much better than most other loyalty cards.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
News
Andy Davidhazy at the beginning (left) and end (right) of his hike
video
News
Taylor Swift is applying to trademark song lyrics from 1989
people
Voices
The popularity of TV shows such as The Liver Birds encouraged Liverpudlians to exaggerate their Scouse accent
voicesWe exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor
Life and Style
Parker says: 'I once had a taster use the phrase 'smells like the sex glands of a lemming'. Who in the world can relate to that?'
food + drinkRobert Parker's 100-point scale is a benchmark of achievement for wine-makers everywhere
News
i100
  • 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.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Ashdown Group: Learning and Development Programme Manager

£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor
How to make your own Easter egg: Willie Harcourt-Cooze shares his chocolate recipes

How to make your own Easter egg

Willie Harcourt-Cooze talks about his love affair with 'cacao' - and creates an Easter egg especially for The Independent on Sunday
Bill Granger recipes: Our chef declares barbecue season open with his twist on a tradtional Easter Sunday lamb lunch

Bill Granger's twist on Easter Sunday lunch

Next weekend, our chef plans to return to his Aussie roots by firing up the barbecue
Joe Marler: 'It's the way I think the game should be played'

Joe Marler: 'It's the way I think the game should be played'

The England prop relives the highs and lows of last Saturday's remarkable afternoon of Six Nations rugby
Cricket World Cup 2015: Has the success of the tournament spelt the end for Test matches?

Cricket World Cup 2015

Has the success of the tournament spelt the end for Test matches?
The Last Word: Justin Gatlin knows the price of everything, the value of nothing

Michael Calvin's Last Word

Justin Gatlin knows the price of everything, the value of nothing