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Best reward and cashback credit cards in the UK – as Apple announces iPhone credit card

Jul 11, 2019

APPLE has announced a new credit card giving customers up to three per cent in cashback, but with a little shopping around you can get even better rates.

If used properly, cashback and reward credit cards boost you for your everyday spending, so it makes sense to use them instead of cash or a debit card.

Apple announced its new credit card for your iPhone called Apple Card in March.

It will offer three per cent cashback when a customer buys Apple products, two per cent when they make purchases through the Apple Pay app and one per cent on everyday card spending.

There's no limit on the amount of cashback that users can receive.

The card will charge no fees but it'll come with annual percentage rates (APRs) ranging from 13.24 per cent and 24.24 depending on your financial situation.

It'll be rolled out in the US this summer. We don't yet know whether it'll become available in the UK too, and if so, whether the features would be the same.

Cashback and reward credit cards – what you need to know

CASHBACK and reward credit cards can be a great way of earning bonuses on your everyday spending. But you've got to use them properly otherwise it could cost you.

Here are some things you need to keep in mind.

High interest rates: Cashback and reward cards can come with higher interest rates than other credit cards, so don't apply for one only because of its rewards unless you're sure you can always repay the balance in full

Pay off the balance each month: Make sure you pay off the balance each month, or you may lose your rewards and cashback

You might not get the marketed rate: Only 51 per cent of applicants have to be given the headline rate, so it's often saved for those with the very best credit histories. Some providers could offer you a more expensive deal instead, so check the details of the card you're looking at to see what you might be offered below the headline offer

Use an eligibility checker: Applying for a credit card will leave a mark on your credit file. But by using an online eligibility checker, you'll get a better idea of your chances of getting accepted or whether it's likely you'll be given a higher interest rate. Money.co.uk and consumer site MoneySavingExpert both have online calculators which you can use to see which cards you're most likely to be accepted for, without affecting your score

Rachel Springall, finance expert at comparison site Moneyfacts, told The Sun: "Any new reward card onto the market is exciting as credit cards offering cashback have dwindled over the years.

"Today customers will find it more difficult to earn something for nothing on a cashback credit card.

"One of the simplest ways to maximise returns would be to use the plastic for everyday spending and then pay off the balance each week. This way, customers can avoid being hit by interest charges that will eat into any accrued cashback."

Best cashback credit cards

No matter whether the Apple credit card will become available to Brits or not, you're already able to find an option with higher cashback offers.

Below are the cards that currently sit at the top of the best buy tables, based on data from Moneyfacts.

  • American Express Platinum Cashback Everyday Credit Card, APR 22.9 per cent – apply here

The American Express (Amex) card gives you the chance to earn a chunky 5 per cent on your first £2,000 of spending within the first three months – earning you a maximum of £100.

After the intro offer is over, you'll get 0.5 per cent cashback on spending up to £5,000 and then one per cent on spending above that.

Keep in mind that you need to need to spend at least £3,000 in a year to receive any cashback.

The card doesn't have a fee but its APR is 22.9 per cent – so make sure you clear your balance fully each month.

  • Santander All in One Credit Card Mastercard, APR 21.7 per cent – apply here

This card by Santander offers 0.5 per cent cashback on spends over £1 per month, but it comes with a monthly £3 fee, which will eat into the cashback you've earned.

You can get the fee for the first six months refunded if you open a 1l2l3 Current Account, Select Current Account or Private Current Account with Santander.

The All in One credit card charges no interest on balance transfer or purchases for the first 26 months, but after this any outstanding balances and new purchases will be charged interest rates of 15.9 per cent.

The card comes with an APR of 21.7 per cent.

  • Tandem Cashback Credit Card, APR 18.9 per cent – apply here

The Tandem card gives you 0.5 per cent cashback on all purchases, along with no maximum limit on how much you can earn.

It has no monthly fees or any fees on purchases abroad, but you'll be charged a fee of 2.5 per cent on cash withdrawals in the UK, with a minimum charge of £2.50.

You should also be aware that there is a £12 fee if you make a late payment, or your payment fails. The card comes with an APR of 18.9 per cent.

How to cut the cost of your debt

BEING in large amounts of credit card debt can be really worrying. Here are some tips from Citizens Advice on how you can take action.

Check your bank balance on a regular basis – knowing your spending patterns is the first step to managing your money

Work out your budget – by writing down your income and taking away your essential bills such as food and transport.
If you have money left over, plan in advance what else you’ll spend or save. If you don’t, look at ways to cut your costs

Pay off more than the minimum – If you’ve got credit card debts aim to pay off more than the minimum amount on your credit card each month to bring down your bill quicker

Pay your most expensive credit card sooner – If you have more than one credit card and can’t afford to pay them off in full each month, prioritise the most expensive card (the one with the highest interest rate)

Prioritise your debts – If you’ve got several debts and you can’t afford to pay them all it’s important to prioritise them.

Your rent, mortgage, council tax and energy bills should be paid first because the consequences can be more serious if you don't pay

Get advice – If you’re struggling to pay your debts month after month it’s important you get advice as soon as possible, before they build up even further.

Groups like Citizens Advice and National Debtline can help you prioritise and negotiate with your creditors to offer you more affordable repayment plans

Best reward credit cards

Reward cards allow users to earn bonuses in the form of air miles and vouchers, instead of getting cash straight into your bank account.

The Sun asked Moneyfacts for the best reward credit cards currently on the market, below are the top ones.

  • American Express Rewards Credit Card, APR 22.9 per cent – apply here

Customers can earn 10,000 bonus Rewards points as long as you spend at least £1,000 in your first three months.

After this, you'll receive one point for every £1 spent on all purchases.

Once you've saved up a total of 5,000 points, this would get you a £25 gift card at retailers including Boots and Currys – for example.

Meanwhile, 20,000 points would give you £100 to spend at Amazon.

The card comes with an APR of 22.9 per cent and no annual fee.

  • Asda Money Cashback Credit Card Mastercard, APR 19.9 per cent – apply here

Asda is allowing shoppers to earn one per cent cashback on all Asda spend, 0.2 per cent on other purchases and 10 per cent on selected Asda insurance products.

There's no limit on how much you can make in cashback through the card.

Just keep in mind you'll receive the cashback in the form of Asda vouchers, which means it's only suitable for those who shop at the supermarket.

The card comes with an APR of 19.9 per cent, and no annual fee.

  • British Airways American Express Card, APR 22.9 per cent – apply here

Customers get 5,000 Avios points when you spend £1,000 within three months of opening the British Airways account with American Express.

If you also spend £20,000 in 12 months, you'll get two for one on travel when redeeming Avios for a BA reward flight.

20,000 points will get you a return flight from London to Athens, as well as other locations in Europe and Africa.

The card comes with an APR of 22.9 per cent, but with no annual fee.

It's going to get harder to get a top 0 per cent balance transfer credit card as lenders adapt to rules announced by the City watchdog last year.

Apart from balance transfer cards, another way to clear debts is to get a personal loan, but what's best for you depends on your circumstances.

Shoppers can also shave up to £300 off bills by switching their store card debts onto a 0 per cent balance transfer credit card.

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