Loyalty doesn’t pay when it comes to your reward card

It’s that time of year again. Mindful of the impending big Christmas shop, people start counting up credit card reward points in the hope of turning them into vouchers and cash. But they could find that their loyalty hasn’t paid off.

Reward credit cards can be a useful alterative to debit cards because they offer a little something extra on each spend, such as points. However, not all cards are as rewarding as they seem. In fact, shoppers could be earning very little each time they use their card if the rewards are limited to where the money is spent. In addition, some cards charge considerably higher interest rates than those that offer no rewards at all, so consumers could be paying over the odds for a few points here and there.

Ever since the EU interchange fee ruling last year, cards with rewards have become far less rewarding, and providers have had to assess how they can recoup their costs.