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AMEX CUTS CASHBACK RATES Are the cards still worth it?

This week it was announced that American Express will slash the cashback rates on both its free and paid cashback cards. Money.co.uk comments on these changes.

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The change on AMEX credit cards will automatically be applied to new customers, with existing customers to follow from the 4th of August. For some customers, this could mean a cashback reduction of up to 50%.

Although the reduction in cashback may seem extreme to some, according to personal finance experts at money.co.uk, American Express cards are still among the best cashback cards on the market.

James Andrews, senior personal finance editor at money.co.uk said: “Cashback cards let you get money for effectively nothing, provided you pay your bill on time each month. But cuts to the American Express offer mean customers will be getting less, while others who pay for their card could see themselves losing money on the deal.

"The cuts to cashback on American Express cards affect two of their products: the American Express Platinum Cashback Everyday card, which is free, and the Platinum Cashback credit cards, which comes with a fee of £25 a year.

“This will primarily affect those who spend between £5,000 and £10,000 over the course of the year.  Paying card holders will earn 0.75% cashback, down from the current rate of 1%. For those that spend more than £10,000, the cashback rate of 1.25% remains unchanged. 

“Free customers currently receive 1% cashback when spending more than £5,000 annually – now cardholders will have to spend at least £10,000 or thier cashback rate will drop to 0.5%.

“However, despite the cut, both cards remain among the top cashback card deals on the market. Despite changes, American Express is still offering its table topping introductory deal. This means new customers will receive 5% cashback for the first three months after signing up.

“If you are unsure as to whether you should go with a free cashback card or one with fees, you can take a look at your spending to work out how much you’re likely to earn in cashback over the course of the year. If it is less than the annual fee, it is probably best to go with the free option.

“As well as offering straight up cash, there are also cards that offer rewards - including Avios and other vouchers. This week American Express announced a new deal with Deliveroo, providing £10 in credits when you use its Amex Gold Card for example.

“The deal breaks down into two payments of £5 back every month, meaning you will have to order at least twice a month from Deliveroo to get the maximum cashback. 

“While the new Deliveroo offer is tempting, and reward cards can be incredibly beneficial if you know how to use them, it’s worth remembering that reward cards often have higher fees than cashback cards. 

“The American Express Gold Card for example, comes with an annual fee of £140, compared to the premium cashback card fee of £25.

“If you're still struggling to find the best deal for you, check out the money.co.uk guide to cashback cards: https://www.money.co.uk/credit-cards/cashback-credit-cards.htm

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Notes to editors

 About money.co.uk

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