Lloyds Bank has launched a new, fee-free cashback credit card that offers up to 0.5% cashback on purchases.
The Lloyds Bank Cashback Credit Card offers 0.25% cashback on every £1 you spend up to £4,000, and 0.5% for every £1 you spend over £4,000.
It also comes with an introductory offer:new customers can get £20 cashback when they spend £1,000 within the first 90 days of opening the account. Offer conditions apply.
Lloyds says there is no cap on the amount of cashback you can earn and it will accumulate over the calendar year (running from 1 January to 31 December). The cashback you earn will be paid directly into the credit card account as an annual lump sum every January.
You'll be able to see how much cashback you've earned on your monthly statements to keep track of how much you're making. If your account is closed, the cashback earned before the closure will be credited to your account.
Credit is subject to status and terms apply. You can use Lloyds Bank's One Check service - an online eligibility checker - before you apply, to understand the credit limit likely to be offered to you.
The card has no annual fee and comes with a representative 19.9% APR (variable).
The table below sets out how Lloyds' cashback credit card compares with others on the market right now.
|Credit card||Cashback rate||Other perks||Representative APR||Representative example|
|Lloyds Bank Cashback Credit Card||0.25% cashback on every £1 you spend up to £4,000, and 0.5% for every £1 you spend over £4,000.||£20 cashback when you spend £1,000 within the first 90 days of opening the account.||19.9%||Assumed borrowing of £1,200 for one year, at a purchase rate of 19.9% (variable), representative 19.9% APR (variable). Credit available subject to status. Terms apply.|
|5% cashback on purchases (up to £100) for the first three months of card membership. After that, it's 0.5% cashback on spending up to £5,000 or 1% on all purchases if you spend above £5,000.||Complimentary supplementary cards for family members.||22.2%||Assumed borrowing of £1,200 for one year, at a purchase rate of 22.2% (variable), representative 22.2% APR (variable). Credit available subject to status. Terms apply.|
|Earn 1% Rewards in all supermarkets (0.25% at their petrol stations). Earn between 1% and 15% in Rewards at MyRewards Retailers and 0.25% everywhere else you shop at home and abroad.||Receive a £24 refund on the annual fee if you hold a Reward or Reward Black current account.||23.7%||Assumed borrowing of £1,200 for one year, at a purchase rate of 18.9% (variable), with a £24 annual fee, representative 23.7% APR (variable). Credit available subject to status. Terms apply.|
|0.5% cashback on all purchases.||0% interest on balance transfers for 26 months from account opening with no balance transfer fee and 0% interest on purchases for 20 months from account opening. No foreign transaction fees on purchases made abroad. Up to 56 days of interest-free credit on purchases. Up to three additional cardholders. Earn up to 15% cashback with Retailer Offers, a free service available through Online and Mobile Banking.||23.7%||Assumed borrowing of £1,200 for one year, at a purchase rate of 17.9% (variable), with a £36 annual fee, representative 23.7% APR (variable). Credit available subject to status. Terms apply.|
|5% cashback on purchases (up to £125) for the first three months of card membership. After that, it's 1% cashback if you spend up to £10,000 or 1.25% cashback on all purchases if you spend over £10,000.||Complimentary supplementary cards for family members.||27.3%||Assumed borrowing of £1,200 for one year, at a purchase rate of 22.2% (variable), with a £25 annual fee, representative 27.3% APR (variable). Credit available subject to status. Terms apply.|
As you can see, American Express - a Which? Recommended Provider for 2021 - currently offers the best rate of cashback at 5%, but it's worth keeping in mind the rate only applies for three months.
After the introductory offer ends, the cashback rate on both Amex deals can still beat the Lloyds cashback offer. However, it's worth noting that American Express is changing its cashback earn rates.
Lloyds Bank, one of the largest banks in the UK, offers a broad range of deals to suit different needs, including and credit cards, as well as cards that offer a consistently low rate for everyday spending.
However, in our latest credit card satisfaction survey, Lloyds Bank credit card customers gave a below-average score of 70%, placing it towards the bottom of our table in joint 20th place along with Vanquis Bank.
Customers were generally pleased with customer service, the application process, and the ability to manage their accounts online, but they were less happy with fees for overseas usage and the transparency of charges.
Getting a cashback credit card isn't about getting into debt. It's about being savvy with your shopping and being rewarded for your spending without spending more than you normally would.
However, cashback credit cards rarely come with 0% introductory offers on purchases. So when using a cashback credit card, you should pay your bill in full each month to avoid paying interest and wiping out the gains you make from earning cashback.
Also, these deals tend to come with an annual fee, so you should make sure your everyday spending and any upcoming one-off purchases can make enough cashback to cover the fee and provide you with a reward.
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