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Low Interest Rate Credit Cards with Cashback Points - PDF

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					March 2005


PETROL CREDIT CARDS – A GOOD WAY TO SAVE MONEY OR DO
THEY FUEL LOW CASHBACK DEALS?

   •   uSwitch.com warns other cards offer over 150% more cashback
       than Texaco and Shell

Thousands of people this week are taking delivery of their new cars after spending a
great deal of time researching the cheapest way to pay for their new vehicle. But
how many will continue their financial savviness and look for the best way to save
money on every day running costs, such as petrol?


Analysis from uSwitch.com Personal Finance reveals that whilst both Texaco and
Shell have their own credit cards that at first glance, appear to offer good cashback
deals, they may not be good value for money.


The table below shows how much cashback a consumer could expect to get over 12
months if they put their average monthly household spend of £793 plus £60 fuel on a
card*. It compares the Shell Visa Card and Texaco Mastercard with the three cards
that currently offer the highest cashback rates on the market (Amex Blue, Amex
Platinum and the Halifax debit card).


A year’s use of the Shell Visa card provides £43.38 worth of points which can only be
exchanged for vouchers or Airmiles. The Texaco Mastercard offers a good 1% rate,
but this is only for purchases on Texaco forecourts and therefore generates less than
£40 per annum. The Amex Platinum card emerges as the product offering the best
value, and provides over 150% more cashback than the Shell Visa Card over the
course of a year.
Table showing the Shell Visa Card and Texaco Mastercard compared with the leading
cashback card provides – their current cashback value on the average weekly spend of
£853 and the standard APR
                  Cashback
Card name         amount APR            Notes
                  (£)
                           4.9% APR
                           for balance Up to £3,000.00 expenditure = 0.5% cashback;
Amex Platinum
                  £114.69 transfers.    Between £3,001 & £7,500 = 1.0% cashback;
Card
                           Typical rate £7,500.00 and above expenditure = 2.0% cashback;
                           14.9% APR
                           2.9% APR
                           for balance
                                        Introductory rate for 3 months 2.0%; Up to £2,000.00
                           transfers (6
Amex Blue         £112.94               expenditure = 0.5% cashback; £2,001.00 and above
                           months).
                                        expenditure = 1.0% cashback
                           Typical rate
                           14.9% APR
Halifax     Debit          -            1% cashback on all debit card purchases, maximum
                  £100.00
Card                                    of £100 cashback per annum
                           3.9% APR 1.00% cashback on purchases at Texaco, 0.50% on
                           for balance purchases elsewhere. Additional 1 star point for
Texaco
                  £62.96   transfers.   every £ spent at Texaco courtesy of We I O U Card.
Mastercard
                           Typical rate £440 spent = £5 vouchers (ie 1.136% cashback at
                           14.9% APR Texaco on We I O U)
                           5.9% APR
                           for balance 43 points per £20 spent on fuel @ Shell + 15 points
Shell Visa Card £43.38     transfers.   per £20 spent elsewhere. 1500 points = £10 voucher
                           Typical rate @ Shell or £10 High Street Voucher or 100 Airmiles
                           17.9% APR
Data provided by www.uSwitch.com Credit Card Calculator. Correct as of 3rd March
2005.



Nick White, Head of Personal Finance at uSwitch.com comments: “Average
households simply do not spend enough on petrol and other goods at petrol stations
to warrant having a credit card tied to one fuel provider. Unless you have a job which
involves a lot of driving, or choose to do your shopping on the forecourt, it makes
sense to look at the other cards on the market and select one that generates a higher
cashback amount based on your level of monthly spending.”


The difference in terms of the highest and lowest cashback rates on credit cards is
vast – historically deals equated typically to 1% of spending, but in recent months,
several leading providers have cut back to just 0.5% and even 0.1%.


White concluded: “We urge consumers to get wise, do their research and use these
cards to their advantage. Cashback cards are most effective for those who pay off
their balance in full every month, thus avoiding interest charges and reaping the
cashback benefit. However, consumers who do not always pay off their balance in
full each month should be wary of the standard APR that their provider levies. Often
the APR can be higher than other regular credit cards and consumers could therefore
lose any benefit accrued from the cashback facility.”


For more information visit www.uSwitch.com
or call 0800 093 06 07
                                         -Ends-

For further information contact
• Nick White, uSwitch.com, on 07899 952875 or
   nickwhite@uswitch.com
• Lucy Gaynor, uSwitch.com, on 0207 802 2967 or
   lucygaynor@uswitch.com
• Beverley Aujla, Lansons Communications, on 020 7294                               3683     or
   beverleya@lansons.com
• Chantal Heckford, Lansons Communications, on 020 7294 3630 or
   chantalh@lansons.com

Notes to editors:

* Average monthly household expenditure according to the Office of National Statistics figures
2002-3


uSwitch.com is a free, impartial online and phone-based comparison service, which helps
consumers compare prices on gas, electricity, home telephone, broadband, digital television,
credit cards and loans. Our aim is to help customers take advantage of the best tariffs and
services on offer from every supplier. The company has developed a set of proprietary calculators
that evaluate a number of factors to advise customers on the best deal to suit their individual
needs.

The service is also available via telephone, fax and post. Consumers can call on 0800 093 06 07,
fax 020 7233 5933 or write to Customer Services, uSwitch.com, 10th Floor, Portland House, Stag
Place, London, SW1E 5BH.

uSwitch.com is not a supplier but acts as an independent advisor, giving customers an impartial
view of what’s on offer. Unlike traditional brokers, it compares prices from all suppliers, not just
those it has a commercial relationship with. The service is based on the most up-to-date
information provided by the supplier companies and industry regulators.

				
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