Reward card customers failing to cash in

By Reno Charlton
News Editor, 15 April 2008

Cash Back Credit Card Best Buys » American Express Platinum credit card - Up to 5% cash back » Barclaycard Platinum Cashback credit card - 1% cash back on supermarket & petrol spend, 0.5% elsewhere » Egg credit card - Up to 10% cash back at selected retailers » i24 Card - 1% cash back Compare Cash Back Credit Cards Related Guides & News Over fifty percent of cardholders pay no interest In a surprise report this week, it’s been revealed that 50% of cardholders in the UK pay no interest whatsoever for carrying and using their credit card. By choosing to spend on a rewards based credit card and paying back their balances in full each month; half the UK’s credit card spending population are actually making money back from the credit card companies. Does your Reward Credit Card Live Up to its Name? If you've previously been tempted by the lure of point based reward schemes, is your reward credit card earning you a plentitude or a pittance? Which Reward Credit Card is Right for Me? The perfect reward credit card for you really depends upon your lifestyle choices and personal preferences. There is a vast array of reward credit cards on offer, covering almost every niche from BMW owners to book worms.

AROUND 50% of the credit card using population is actually spending on a rewards based credit card in an attempt to 'beat the banks' and earn something back from their spending.

Reward credit cards are most popular with people who tend to repay their credit card balances in full each month, as they not only enjoy the ease and convenience of paying by plastic without paying out in interest, but get the added bonus of earning cash back or collecting reward points simply for spending on a particular credit card.

Four billion pounds left unclaimed

A recent report however, has shown that many of these credit card users are actually failing to cash in on their rewards, and the report suggests that around four billion pounds worth of rewards have not been collected.

It is thought that a massive 83% of cardholders have not collected their rewards, with around 57% having accrued an average of £42 worth of reward points on their cards, and a further 20% having accrued air miles worth £160 or more.

Redeeming is better than hoarding

Often, while there can be minimum limits set on redeeming points, trying to hoard enough points to claim an entire holiday can be a lot less money saving than you might think a free holiday would be.

Redeeming your miles or points sooner for a European flight or even towards just some of the bill – will actually see more money in your bank account sooner instead of allowing your card issuer to earn the interest instead.

Many programs, especially air mile or travel reward ones, will allow you to pay part cash and part miles (or points). This is where you really should be claiming any miles or points you've currently accrued.

Know when it's time to switch

If you're card savvy enough to keep your plastic spending repaid and clocking up the points on top - then you should also be wise enough to know whether you've chosen the right reward program or not.

Lyndsey Burton from Credit Card Comparison Online said: "If you are simply not finding anything you want to redeem your points for, or even if you just never get round to doing it; it might be time to think about switching to a more suitable credit card reward program."

"Sometimes straight and simple cash back can be the best option - you don't need to remember to claim it as it's sent out automatically and you'll always be able to spend it on anything you like - or even add it to your savings account!"

Rewards based credit cards give consumers the chance to actually make some money from the credit card companies rather than the other way round, and it seems a shame that so many people are wasting this opportunity.

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