Can cashback cards cut the cost of Christmas?
New research from Moneyfacts.co.uk has highlighted the best cash back options for the Christmas season.
It points to Barclaycard’s new cashback card, launched last week, paying 0.25% for every purchase. However, this is some way behind American Express, which still tops the tables with its Everyday Cashback Card paying 5% cashback for the first three months. At the same time, Amex is running ‘shop small’ incentive for two weeks in December, where shoppers spending £10 or more get £5 back on single transactions.
Its nearest competition is the Santander All in One Credit Mastercard, paying 0.5% cash back and with a introductory balance transfer.
However, shoppers need to pay balances off in full or risk being stung by relatively high interest rates. On a family’s average Christmas spend of £800, the Barclaycard would only give £2 back. The American Express Everyday Cashback card would give £40, but at 28.2%, this would quickly be eaten up if borrowers didn’t pay off the balance. smile’s 16.9% rate will be better for anyone who may leave a residual balance on their card each month.
Moneyfacts.co.uk said it typically takes between seven to 10 days to receive a card in the post when applying online, so there is still time before Christmas. There are also some newly launched offers and extra cashback deals to take advantage of this year.
Rachel Springall, Finance Expert at Moneyfacts.co.uk: “Consumers would be wise not to let any points go to waste on their loyalty cards or reward cards. Shoppers can download the Stocard app for free and load all their loyalty cards for quick use to make the most of every transaction, which is great for those who may forget the physical card. This time of year, shoppers should also take advantage of any points they have accumulated over the past 12 months on reward credit cards, such as with Sainsbury’s Nectar and Tesco Clubcard schemes, if they haven’t already.
“If shoppers are already super-organised and have all their gifts ready for wrapping, then there are other ways to get a bit of free cash, such as by switching current accounts. Halifax is still offering a switching incentive of up to £135, plus a £2 monthly reward and up to 15% cashback if certain criteria are met. Shoppers can also get £185 in gift cards from M&S Bank if they switch and stay for 12 months with the bank. Cashback websites are a fantastic choice for consumers who don’t want to change any of their financial arrangements, for example TopCashback, where shoppers can earn a little extra on different purchases.”