A money-back credit card with a 4% dividend? That is how Alliance & Leicester has raised the stakes in the credit card loyalty wars.
The Money-Back card was launched just over a year ago and claims to be the most frequently used card in the UK with 350,000 customers making an average 12 transactions a month.
The card gives you pounds rather than points, with a money-back cheque related to your annual spend.
If you spend up to #3000 a year (#250 a month) on the card the dividend is only 0.5%, but that is doubled to 1% if you are spending more than #3000 - regardless of whether your card is in debit or you pay it off every month.
If you shop with the scheme's ''retail partners'' - BP, Interflora, Index, Ticketmaster, Going Places, ATS, Currys and MFI Homeworks, you get 2% money back on the bigger annual spend.
Now, for a two-month period which ends on July 11, the pay-out is doubled to 4% on purchases at three of the partners - ATS, Index and Interflora. Spending #5550 on your card in a year would earn you #40.50 back.
There is no annual fee. When you pay interest on an outstanding balance, you get 5% of the value as money back.
If you do pay off your card each month, this is a reasonable loyalty deal, depending on your shopping habits.
If you do not, the rate of interest becomes all-important. The A&L charges 12.9% for balances switched into the account (or 11.9% if you close your old account) then 17.9% when the old balance is paid off.
That is the same (17.9%) rate charged by the aggressive new market entrants Capital One and RBS Advanta, which both offer rock-bottom ''teaser'' rates of 6.9% and 7.9% respectively until the end of the year, to hook you in.
Co-op Visa Advantage and Robert Fleming/S&P offer the best ordinary rates, but no interest-free period.
RATING ***
*** Worth considering
** Shop around
* Hype alert
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