Best rewards credit cards UK


Updated on 01 September 2021 | 1 Comment

You can get free flights, money off your supermarket shop and more with the best reward credit cards.

Reward credit cards can be a handy way to earn hundreds of pounds worth of perks when you use them for everyday spending.

There are a lot of different types of reward credit cards on the market, so you should choose wisely to make sure you earn benefits that are valuable to you.

For example, you can get free airmiles or extra loyalty points to use at your favourite supermarket.

It’s worth stressing that reward cards are ideal for those who are confident that they can pay off the full amount every month to avoid paying interest, which can be higher compared to other credit cards.

You generally don’t get a 0% interest-free period, so it’s vital you pay back what you owe in full every month.

In this article, we’ll reveal what types of reward cards are available on the market and what you should expect.

If you’re more interested in cashback credit cards, check out our guide to the best cashback credit cards.

We're working with Compare the Market* where you can find out what credit cards you are eligible for without harming your credit score. Click here to find out more or jump straight in and discover which credit cards you're likely to qualify for.

Woman using a reward credit card. (Image: Shutterstock)

Flexible rewards schemes

Some credit card providers, including American Express, offer points that can be converted into frequent flyer points, or allow you to use them at various retailers.

American Express offers generous points bonuses although these have been cut on its cards over the last few years.

But they still have a big advantage as you can use your points with American Express at a range of places, instead of specific airlines, hotels, or supermarkets.

American Express Preferred Rewards Gold 

You’ll get 20,000 bonus points when you spend £3,000 with the American Express Preferred Rewards Gold card in your first three months of membership (this is easier said than done).  

Membership Rewards points can be converted to air miles for various airlines or used to pay for goods or services.

You can earn one Membership Reward point for every £1 spent on purchases, two points for every £1 spent directly with airlines or in a foreign currency and three for every £1 spent at American Express Travel.

The annual fee is an eye-watering £140 (representative APR 56.6%), but this is waived for the first year so make sure you cancel before the year is up.

You'll also get two complimentary airport lounge visits per year with this card.

There is also a fee-free version of this card: the American Express Rewards Credit Card.

It has 10,000 Membership Rewards points on offer if you spend £2,000 in the first three months of card ownership and has an APR of 24.5%.

You can earn one Membership Reward point for every £1 spent on purchases.

Compare credit cards (Image: CTM)

American Express Nectar

The American Express Nectar Credit Card (representative APR 27.3%) can help you build up Nectar points.

You earn two Nectar points for virtually every £1 you spend, which increases to at least three points when you shop at Nectar partners.

What’s more, spend £2,000 in your first three months with the card and you’ll pocket a bonus 20,000 Nectar points.

The card does cost £25 a year, but American Express currently waives the fee for the first year.

We're working with Compare the Market* where you can find out what credit cards you are eligible for without harming your credit score. Click here to find out more or jump straight in and discover which credit cards you're likely to qualify for.

Food on a flight. (Image: Shutterstock)

Airline and hotel reward cards

If you travel on a regular basis, there are plenty of reward credit cards that will help you earn free flights, cabin upgrades or hotel stays. 

You can find out more about airline frequent flyer schemes here.

British Airways American Express

The fee-free British Airways American Express Credit Card (representative APR 24.5%) offers 10,000 bonus Avios points (up from 5,000) when you spend £1,000 within your first three months of owning the card.

But this offer is for a limited time only as you'll need to apply and be approved for the card by midnight on 2 November. 

The British Airways American Express Card allows you to earn one Avios for every £1 you spend and when you spend £12,000 or more within a membership year, you get a complimentary companion voucher.

For very high spenders, there is the British Airways American Express Premium Plus Card.

It has a higher earn rate (1.5 Avios per £1) and a higher bonus (40,000 Avios up from 25,000 for £3,000 spent in three months) but also a very high fee of £250.

This annual fee has recently been hiked from £195, while the representative APR has jumped from 74.7% to 101.1%.

You’ll also earn three Avios points for every £1 spent with British Airways or BA Holidays, plus you’ll only have to spend £10,000 in a year to get a companion voucher.

Virgin Atlantic Reward Mastercard

 Unfortunately, the Virgin Atlantic Reward Credit Card (representative APR 22.9%) no longer offers 5,000 Flying Club miles for your first card purchase, which may have been a huge draw for new customers.

As it's a Mastercard, it can be used in more locations than American Express cards – and sometimes even for Council Tax.

You can earn 0.75 Virgin points for every £1 you spend plus 1.5 points for every £1 spent with Virgin Atlantic or Virgin Holidays. You'll get a complimentary companion voucher or premium economy upgrade when you spend £20,000 or more within a year.

If you're a very high spender, the Virgin Atlantic Reward+ Credit Card (representative APR 63.9%) has a big welcome bonus (15,000 bonus points), a higher earn rate (1.5 points per £1) and you only have to spend £10,000 in a year to get a companion ticket.

You’ll also get three points for every £1 you spend with Virgin Atlantic or Virgin Holidays, but the card has a steep £160 annual fee.

IHG Rewards Club Mastercard

The fee-free IHG Rewards Club Credit Card (representative APR 22.9%) offers 10,000 bonus points when you spend £200 within your first three months with the card.

You can earn one point for every £1 you spend in the UK and two points at any IHG hotel and for every £1 spent abroad. 

The card gives you Gold Elite Status, which means you benefit from priority check-ins and extended check-outs.

The card also offers 0% interest for 12 months on balance transfers, but you have to pay a fee (3% or £3, whichever is greater), which isn't the greatest offer. So, if you did need to shift debt you'd be far better off choosing a top balance transfer card instead. 

Groceries in a supermarket trolley. (Image: Shutterstock)

Supermarket and shop points

Some supermarkets and shops offer credit cards that allow you to build up points that can be exchanged for rewards, usually at the same place.

Bear in mind that a cashback card could be better value in the long term.

M&S Rewards Mastercard

The M&S Bank Rewards Credit Card (representative APR 19.9%) gives customers points to spend on M&S shopping. 100 points is worth £1 in M&S vouchers.

The card gives you 0% on purchases and balance transfers for 12 months. The latter is available for 90 days from account opening, but a 2.9% fee applies (or a minimum of £5). 

In your first year, you'll earn two points for every £1 spent in M&S (one point in subsequent years) and one point for every £5 spent elsewhere.

M&S Shopping Plus Offer Mastercard

With the M&S Shopping Plus Offer Credit Card (representative APR 21.9%), you get 0% on purchases for 20 months and there’s also 0% on balance transfers for 20 months (2.9% fee, min £5).

You’ll earn one M&S point for every £1 you spend in-store or for every £5 spent elsewhere.

The best UK supermarket loyalty schemes

Sainsbury’s Bank Dual 19 Month Credit Card

If you frequently shop at Sainsbury’s, you might like the Dual 19 Month Credit Card (representative APR 21.9%).

Not only do you get to avoid interest on your spending for up to 19 months, but you’ll also get up to 19 months interest-free on balance transfers (3% fee, min £3), as well as Nectar points.

You can collect up to three Nectar points for every £1 you spend on Sainsbury's shopping, Argos or Tu Clothing when you use your credit card and swipe your Nectar card. Plus, you’ll collect one Nectar point for every £5 spent elsewhere.

On top of this, you get 500 bonus points each time you spend £35 or more on Sainsbury’s shopping, up to 10 times in the first two months (5,000 in total).

For years, Sainsbury’s offered a more generous boost of up to 7,500 points, but this was recently cut.   

It’s worth noting this bonus is also available with other credit cards offered by Sainsbury's Bank.

We're working with Compare the Market* where you can find out what credit cards you are eligible for without harming your credit score. Click here to find out more or jump straight in and discover which credit cards you're likely to qualify for.

Sainsbury's Bank Nectar Dual 21 Month Credit Card

There’s also the Sainsbury’s Nectar Dual 21 Month Credit Card (representative APR 20.9%) with up to 21 months interest-free on purchases and balance transfers (3% fee, min £3).

Unfortunately, you have to be a Nectar member for at least six months to apply.

Similar to the Dual Offer card, you can collect up to three Nectar points for every £1 you spend on Sainsbury's shopping, Argos or Tu Clothing when you use your credit card and swipe your Nectar card. You’ll also collect one Nectar point for every £5 spent elsewhere.

On top of this, you get a bonus 500 points every time you spend £35 or more on Sainsbury's shopping, up to 10 times in the first two months (5,000 in total)..

John Lewis and Waitrose Partnership Card

With the John Lewis and Waitrose Partnership Card (representative APR 18.9%), you’ll earn points to go towards John Lewis Partnership vouchers every time you spend.

Every 500 points you earn is worth £5 in vouchers. You'll earn five points for every £4 spent in-store or online at John Lewis and Waitrose and one point for every £4 spent elsewhere.

You’ll also get 0% on purchases for nine months, and 0% on balance transfers for 18 months (2.9% fee, min £5).

Tesco Bank Purchases Card

The Tesco Clubcard Purchases Card (representative APR 20.9%) gives you 0% interest on purchases for up to 22 months.

When you use this credit card, you can get five Clubcard points for every £4 spent in Tesco (or on Tesco fuel) and one Clubcard point for every £8 spent elsewhere.

A final word of warning

Finally, remember, if you’re using a rewards credit card, always ensure you pay off your bill in full each month to avoid being hit with a hefty interest charge, which will wipe out the rewards you’ve managed to build up.

An easy way to do this is to set up a Direct Debit that pays off the balance in full every month, providing you can afford this. 

Prefer cashback? Take a look at The best cashback credit cards.

Still not found the right card for you? View our complete guide to credit cards to see all your options.

*loveMONEY has teamed up with Compare the Market to provide credit card price comparison services. Compare the Market Limited acts as a credit broker, not a lender. To apply you must be a UK resident and aged 18 or over. Credit is subject to status and eligibility.

 

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