Credit card rewards still continue to be the deciding factor while choosing cards

As per the research conducted by Sainsbury’s credit cards around 8.65 million of the population plan to apply for a fresh credit card within the next twelve months and 28% has revealed that they would prefer to take cards that offer them a loyalty reward. This seems to be the deciding factor while choosing a card.

But the research has also revealed that only less than 35% of the credit cards in the United Kingdom offer any loyalty reward and 14% of them offer cash back, and around 11% offered cash back that was less than 1%. There are those that also charge a fee to have a card. On an average the cash back deal is 0.8%, but the Sainsbury’s Gold Credit Card and Sainsbury’s Nectar Credit Card offer 2% cash back when used along with a Nectar card.

One out of every ten cardholders are looking for a fresh card and around 10% are doing this because their cards are offering no rewards and another 8% are shopping around for a fresh card because their existing card providers have either reduced or cut back on their rewards. There are another 9% that say that they are looking for other add-on benefits like travel insurance.

The Head of Sainsbury’s Credit Cards has stated that they feel encouraged as more and more people are shopping around for cards that have rewards. However, with so many credit cards in the market one can easily get all muddled up.

He also goes on to state that the first thing that people should consider while applying for a fresh card is the maximum benefit that can be availed with the usage of the particular card. In general card users look for the maximum benefits that they can avail from the card. It could be in the form of rewards from their cards or through reward points through shopping, cash back, travel benefits etc. Hence, if the loyalty rewards are put to good use people can get much more value out of their credit cards.

The next prime reason for choosing a fresh card was either because the balance transfer periods had expired, or because people wanted to shop around for a card with lower interest rates and also because of the expiry of the interest-free period on purchases.

The tough economic conditions have forced people to look out for the maximum benefits that they can get out of their cards.