Asda launches two cashback credit cards

Posted by Simon Hadley in Personal Finance on 30 August 2016 - Simon is a Credit Analyst at checkmyfile.

Asda has launched two new credit cards, the second of which, the Cashback Plus Credit Card, will allow card holders to obtain 2% cashback on all Asda purchases.

Customers who register for the product will also be able to receive 1% cashback on all none Asda-based purchases, both home and abroad, while consumers will also get 10% cashback on selected Asda Money insurance products.

The card also offers 0% interest on balance transfers for up to 15 months, as well as 0% interest on all purchases made through Asda’s online clothing range, George, providing that you spend an initial £200. Applicants will also have to have a minimum annual income of £10,000, and not be claiming unemployment benefits in order to be eligible to apply.

This is the second time in four years that the supermarket giant has attempted to entice the public with a cashback card, having previously launched an “unlimited card” in 2012 which offered 0.5% cashback for those shopping elsewhere.

The timing of the announcement coincides with American Express’ Platinum Cashback Credit Card offering 5% cashback in the first three months, while Capital One, Halifax and Santander have also cut back on their reward schemes, paving the way for Asda to attract discouraged consumers from its rivals.

Lenders have been reducing or axing credit card rewards since the introduction of the Interchange Fee Regulation (IFR) in December by the EU which is designed to cap credit and debit card processing fees. Many lenders, such as Halifax, for instance, have been earning less money from each transaction, limiting the amount of financial incentives it is able to offer its customers.

As with most credit card deals, it is also worth considering if the positives outweigh the negatives. The Cashback Plus Credit Card carries a standard rate of 26.2% ARR depending on the applicant’s credit rating: If you have a poor credit score, the higher the APR is likely to be. There is also the monthly £3 charge to consider, too.

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