When deciding whether to take out a cashback or a reward credit card, I know where my loyalties lie. But which would you prefer? A card that will pay you to shop, or one that will send you vouchers in the post?
Last month, Barclaycard, my credit card provider, emailed me about ‘exciting changes’ to its Freedom rewards scheme. It was launching a new reward programme, which would provide ‘tailored and valuable offers from thousands of merchants’.
It also said that I wouldn’t be able to earn Reward Money from June and I’d have until 26 July 2012 to redeem any I’d saved up.
To my annoyance, I assumed this would mean an end to the 1% cashback I’ve been earning with Barclaycard since it took over my former Egg Money credit card last year. But my fears were unfounded – my 1% cashback is safe. It’s only Barclaycard Freedom that is changing.
Can reward cards trump cashback?
Thank goodness. My regular deal gives me 1% cashback on everything I buy; Barclaycard Freedom in its previous form only offers cashback at ‘selected retailers’, very few of which I shop at. But it got me thinking about the merits of these types of reward schemes – I find it hard to imagine how they could trump a decent cashback card.
Which? Convo commenter Sophie Gilbert shared her love of reward cards on a previous post:
‘I’ve got two reward credit cards, one with John Lewis and one with House of Fraser, and I love getting the vouchers when they come in the post.
‘I can always find something to buy at John Lewis especially and at House of Fraser, so it’s not as if the vouchers were going to lie in a drawer unused. And it’s not as if I wasn’t going to spend the money on my credit cards either as I use them for all my shopping.’
However, to me, cashback is like getting an annual bonus just for spending as you would normally – all you need to do is pay for things in a certain way.
Other reward schemes may offer higher percentages, but you often sacrifice flexibility by only earning rewards at a certain retailer or group of retailers (such as Sophie’s John Lewis vouchers) or having to accept rewards in the form of retailer-specific vouchers. And I, for one, prefer my ‘flexible friend’ to be exactly that.
Which do you prefer - cashback or reward credit cards?
Cashback cards - I like earning as I spend (52%, 105 Votes)
I don't like either - what's wrong with a normal credit card? (33%, 67 Votes)
Reward cards - I like getting rewards in the post (15%, 31 Votes)
Total Voters: 208