The latest news to help you get the most from your credit card.
Here’s my monthly update sharing changes for leading UK credit cards, as well as some of the relevant articles you might have missed on the blog.
August’s credit card update video
August credit card news
Lloyds launch new cashback credit card
Though American Express cards are the highest paying reward and cashback credit cards, I always think it’s worth having a Visa or Mastercard alternative on me (some retailers still don’t accept Amex).
At first look this new card from Lloyds appears to be the best one out there, with a cashback rate of up to 0.5%. But it’s that “up to” that’s key here.
You only earn this rate on spend above £4,000 in a calendar year. Below this it’s 0.25% – the same as the best exisitng cards.
Now if you have an Amex for most of your spending, you’re unlikely to get close to that £4,000 each year. And that means you’ll be earning the same 0.25% as you would with other cards.
So what? Well there are other options which have boosted returns at specific retailers such as Amazon and Waitrose/John Lewis. Or there’s fee-free cashback abroad via Barclaycard.
Amex Platinum Cashback card rates have now dropped
On 4 August 2021, the rates on both the American Express Platinum Cashback and American Express Platinum Cashback Everday cards dropped. You can see a full comparison of how this new rate compares to the old in this news article from when the change was announced.
Ultimately these cards are still decent earners, but they’re no longer the highest earning Amex credit cards. Here’s a rundown of the top cards for newbies and existing cardholders.
BA Amex revamp coming next month
The two British Airways American Express cards are changing how you earn and use companion vouchers.
These are popular rewards, allowing you to get a free ticket on the same flight as you when you buy one using your points. I’ve never used these as you always needed a huge number of points to make it worthwhile for Business class or higher cabins (in my opinion), and taxes are added on top. But I’ve certainly considered it.
Well, it’s now harder and more expensive to justify using either the BA Amex or BA Premium Plus Amex versus other American Express reward cards.
From 1 September, these changes will apply:
British Airways American Express card
- 2-4-1 vouchers can only be used on Economy flights
- 2-4-1 vouchers will be earned with a £12,000 spend a year, rather than £20,000
British Airways Premium Plus American Express card
- The annual fee jumps from £195 to £250 a year
- 2-4-1 vouchers earned after 1 September can’t be used with any existing vouchers you have
- There will be more seats available for voucher use
Barclaycard adds ‘Cashback Rewards’
All Barclaycard customers have the potential to earn a little back from specific retailers if they sign up to the new Cashback Rewards scheme.
At the moment it’s very limited so I wouldn’t get too excited. But if you have a Barclaycard you may as well sign up as the offers are automatic – there’s no need to activate them.
Sainsbury’s Bank stops welcome bonuses
There are a number of welcome offers from Sainsbury’s Bank credit cards based on spending that are due to end on 8 August 2021. It could be we see new promotions begin, so I’ll update you next month.
Bip, the UK’s first digital only-credit card launches
You can now apply for Bip – a digital-only credit card. On the whole it’s exactly the same as any other credit card, except you don’t get a physical card. This means you need to add it to your phone via Apple or Google Pay to use in shops, though online you’ll always have access to the card number and other details without having to find your wallet.
The other difference is that it’s app only, though you can check eligibility on the website first before downloading it. There are a handful of features here such as the ability to set spending caps and ‘boosted payments’.
The spending caps can be set yourself. They’re either a warning cap that you’ve hit a certain spending level, or a freeze cap that stops any further payments. It’s a nice feature that could help with budgeting – though I’d say if overspending is a worry you’re better off not using a credit card.
The boosted payments feature is essentially just a calculator telling you how much you’ll save in interest charges if you pay more than the minimum each month. But if you’re someone who isn’t clearing your card in full every month then this isn’t the card for you – the interest rate is a huge 29.9% APR.
The card won’t charge any fees, including for overseas spending, but there are better fee-free options available to you.
Overall it’s nothing to get excited about and there are far better options available to you.
This month’s best credit cards
As always when talking about credit cards the best credit card for you will depend on your credit report and why you need one.
Make sure you read my rules for having and applying for a credit card. You’ll also find my list of the latest offers in the same article.
But assuming you’ve got a great credit report, don’t need one to clear existing debts and will clear the balance completely each month, these are my top picks:
Andy’s Top Three Credit Cards (August 2021)
- Amex Preferred Rewards Gold Card for the welcome bonus (read more)
- Amex Nectar for ongoing 1% cashback
- Barclaycard Rewards for 0.25% cashback and fee-free spending overseas
Listen to Cash Chats, Andy’s twice-weekly podcast. Episodes every Tuesday and Friday.