The credit cards that pay the most cashback
Asda has launched two new cashback credit cards.
The supermarket has bucked the trend of lenders scaling back their rewards on these types of cards in response to new EU rules on intercharge fees.
American Express recently increased the amount you have to spend to earn the higher rate of cashback for new customers. While Halifax, Santander and Capital One have also cut back their rewards programmes across the board.
Here's a look at what the two new Asda credit cards offer and how they stack up with other top deals.
Asda Cashback Credit Card
The Asda Cashback Credit Card pays 1% cashback on all Asda spends including petrol and Geroge.com and 0.5% cashback on purchases made elsewhere.
You can also get 10% cashback when you take out selected Asda Money insurance products using the card.
As soon as you have £2.50 in cashback you can download or print a voucher to spend in Asda stores or leave it to let it build up on the card.
The card also offers fee-free transactions on foreign currency from Asda Travel Money, 12 months 0% on balance transfers (3% fee) and six months' interest-free on all George.om purchases of £200 or more.
The card comes with a representative APR of 19.9%.
Asda Cashback Plus Credit Card
The Asda Cashback Plus Credit Card pays a juicer 2% cashback on all Asda spends, 1% cashback elsewhere and 10% cashback on Asda Money insurance products.
Again as soon as you have £2.50 in cashback you can download or print a voucher to spend in Asda stores or leave it to let it build up on the card.
The card also offers fee-free transactions on foreign currency from Asda Travel Money, 15 months 0% on balance transfers (3% fee) and six months' interest-free on all George.om purchases of £200 or more.
However, the card attracts a £3 monthly fee, so you'll need to make sure you can earn enough to make the card worthwhile.
The representative APR for this card is also 19.9%.
American Express Platinum Cashback Everyday Credit Card
Despite taking an axe to their rates, the Amex cards are still among the best out there.
With the American Express Platinum Cashback Everyday Card, you'll still get 5% cashback in the first three months up to a maximum of £100 – in other words you'll need to spend £2,000 during that period to get the top amount.
After that you will earn a tiered rate of cashback depending on how much you spend – and this is when you'll notice the newer, less generous rates.
Before, you would earn 0.5% on spends of up to £3,500, 1% on up to £7,500 and 1.25% on anything above that.
Under the new offer, you'll get 0.5% on the first £5,000 and 1% on all sums above that. The 1.25% rate is gone completely.
There's still no annual fee on the card, however, and the APR remains 22.9%.
American Express Platinum Cashback Credit Card
The American Express Platinum Cashback card still pays 5% cashback in the first three months up to a slightly higher maximum of £125, as before.
But whereas you could get a flat cashback rate of 1.25% on all of your spending after that, Amex now pays 1% cashback on the first £10,000 worth of spending each year, and 1.25% cashback on everything else.
The special 'anniversary' rate, where each year you have the card the cashback rate doubles to 2.5% for a month, has also been scrapped.
Note you'll need to spend a hefty £10,000 in the previous year to qualify for this rate.
There is also a £25 annual fee to take into account, while and the APR is 28.2% (both unchanged).
Nationwide Select Credit Card
Elsewhere, the Nationwide Select Credit Card offers a flat rate of 0.5% cashback on all purchases made in sterling.
On top of that you can get 0% on purchases for 12 months, free 0% on balance transfers for 12 months and unlimited commission-free purchases abroad.
However, only Nationwide FlexAccount, FlexDirect and FlexPlus account holders are eligible for the card.
The card has a representative APR of 15.9%.
AA Fuel Save Credit Card
Drivers could benefit from the AA FuelSave Credit Card.
It offers 0.5% cashback on all purchases and a special rate of 2% cashback on fuel, which doubles to 4% when you spend £500 or more a month. Cashback is capped at £150 a year.
The card also comes with free AA Breakdown Cover in your first year followed by a free MOT every year you hold the card. Existing members will get a free MOT in the first year instead of breakdown cover.
The representative APR is a high 22.4% and the card attracts an annual fee of £42.
Santander 123 Credit Card
The Santander 123 Credit Card pays 1% cashback on supermarket spending (up to £300), 2% in department stores (up to £150 a month) and 3% on petrol or train fares (up to £100 a month). The amount of cashback you can earn each month is capped at £9.
On top of all that the card also boasts a 23-month 0% period on spending. And there's a 23-month 0% period on balance transfers as well if you need it, with no transfer fee.
There is a £36 yearly fee, though if you move your current account to the Santander 123 Current Account, there's no fee for the six months. The representative APR is 18.4%.
NatWest/RBS Reward Credit Card
NatWest and Royal Bank of Scotland both offer the Reward Credit Card.
It pays 1% cashback on all spending at supermarkets (0.5% at their petrol stations), while you'll also get at least 1% at MyRewards partner retailers (including the likes of Ernest Jones, BP and New Look). You get 0.5% cashback everywhere else when you shop at home and abroad.
On top of that you'll earn 1% cashback when you use contactless or Apple Pay payments (up to £30) until December 31 2016.
The representative APR is 23.7% and the card has an annual fee of £24, but you can get it free if you have the Reward, Reward Silver, Reward Platinum or Reward Black current account.
Making the most of cashback cards
To make the most of your cashback card, put as much of your spending on it as you possibly can but always clear the balance at the end of the month. Setting up a direct debit payment to do this is the easiest way to make sure you don't have to pay any interest charges.
As with any credit card, using it will give you the legal protection offered by Section 75 of the Consumer Credit Act 1974.
In addition, never use these credit cards to withdraw cash. The charges are horrendous and your withdrawals won't qualify for cashback. Balance transfers also aren't eligible for cashback.
If you'd prefer rewards to cash, such as Nectar points or Avios, a reward credit card is a better option.
