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Ikea and Lloyds Bank unveil new credit cards – here's what each offers
Ikea offers interest-free shopping and rewards, while Lloyds adds cashback and travel perks
Ikea and Lloyds Bank have both unveiled new credit cards this week, aimed at very different types of spending.
The Ikea Family credit card offers up to 20 months interest-free on in-store purchases, plus extra Ikea Family reward points.
Meanwhile, the Lloyds Ultra credit card focuses on cashback and fee-free overseas spending.
Here, Which? takes a closer look at what each card offers – and how they stack up against the best alternatives.
What does the Ikea Family credit card offer?
Ikea’s new card is designed to help customers spread the cost of big-ticket items and collect extra rewards when shopping in-store.
Interest-free payment options
The Ikea Family credit card offers interest-free instalment plans on purchases made at Ikea and elsewhere.
Purchases made at Ikea between £99 and £299 can be paid over three months interest-free, while purchases up to £1,199 and £2,000 can be spread over 10 and 20-month terms respectively.
Purchases up to £299 made elsewhere can be paid over three months for a 3% fee.
The card also offers up to 56 days interest-free on all purchases.
Ikea Family reward points
You can earn two points for every £5 spent at Ikea when used with your Ikea Family member card, and one point for every £10 spent elsewhere.
Points can be converted into vouchers that save you money on Ikea delivery, food or furniture.
Points don’t have a fixed cash value but typically work out at around 4% back on Ikea spending and about 1% back elsewhere. For example, spending £500 at Ikea would earn 200 points – enough for £20 off delivery.
This table shows some examples of how you can use your points to get discounts at Ikea.
| 45 points | 200 points | 500 points |
|---|---|---|
| Get one meatball meal for 50p (normally £5.95) | Get £20 off delivery | Save £40 when you spend £41 or more |
What’s in the small print?
To apply for the card you must be 18 or over, a UK resident and be an Ikea Family member (which is free to join).
Instalment plans are managed via the Ikea Finance app. After making an eligible purchase, customers have 10 days to convert to an instalment plan.
It has a representative APR of 23.9% (variable). If you don't select an instalment plan, or if you miss a payment on your instalment plan, you'll be charged the standard purchase rate of 23.9%.
You won’t receive a physical card. Instead, you’ll get a virtual card that's managed via the Ikea Finance app. The card has no annual fee, and credit is provided by Ikano Bank.
- Find out more: best credit card deals
How does the Ikea credit card compare?
If you’re looking to spread the cost of purchases, there are cards that offer longer interest-free periods and more flexibility than the Ikea Family Card.
Other 0% purchase cards currently offer up to 25 months interest-free on all spending, compared with Ikea’s maximum of 20 months.
With those cards you don’t need to remember to set up instalment plans, so there’s no risk of being charged interest if you forget.
But the Ikea Family credit card may still appeal if you frequently shop at Ikea and want to earn extra reward points alongside your purchases.
- Find out more: best interest-free credit cards
What does the Lloyds Ultra card offer?
Lloyds Bank’s Ultra card combines everyday cashback with the perk of no overseas fees.
Cashback
The Lloyds Ultra card offers 1% cashback on purchases for the first year, and 0.25% after that.
Cashback applies to all purchases, including those made abroad and recurring transactions such as subscription services, and there's no cap on how much you can earn.
Cashback is shown on monthly statements but paid once a year in January, as a single amount into your account.
- Find out more: best cashback credit cards
Fee-free spending abroad
The card has no foreign exchange fees, meaning you won’t pay extra when using the card abroad. Typically, most providers add around 3% to each overseas purchase, so the savings can quickly add up.
The card also has no fees on cash withdrawals in the UK or overseas, although local ATM or third-party charges may still apply.
Lloyds uses the Visa exchange rate.
- Find out more: best travel credit cards to use abroad
What's in the small print?
To apply for the card you must be 18 or over, a UK resident, and have a regular income. You can't apply if you've been declined for a Lloyds credit card in the past 30 days.
The representative APR is 12.9% (variable), which is lower than most other credit cards, and the card has no annual fee.
- Find out more: best low-interest credit cards
How does the Lloyds card compare?
For cashback, some American Express cards offer introductory rates of up to 5% for the first three months, although these deals are capped and the rate drops afterwards.
Santander’s Edge card pays 1% consistently, but cashback is capped at £10 a month and there’s a £48 annual fee.
Unlike many cashback cards, it also comes with a relatively low ongoing interest rate, which makes it more competitive if you don’t always clear your balance in full.
Where Lloyds Ultra stands out is for travel use: it combines cashback with no overseas spending fees, something most cashback cards don’t offer. If you mainly want a card for holidays or spending abroad, this could be a strong contender.
- Find out more: best credit card providers
5 things to keep in mind when getting a credit card
- They’re regulated: Credit cards are regulated by the Financial Conduct Authority (FCA). You can also complain to the Financial Ombudsman if something goes wrong.
- They offer purchase protection: Section 75 of the Consumer Credit Act makes the card provider jointly liable with the retailer for purchases between £100 and £30,000.
- Rates can be high: Once promotional deals end, APRs can be expensive if you don’t clear your balance in full.
- Check eligibility first: Using a soft-check tool helps you see your chances of approval without affecting your credit score.
- Pick the right card: A 0% purchase card helps spread the cost of big buys, cashback cards can reward everyday spending, and travel cards save you fees abroad.
