Santa’s Little Helpers: Best banking options for spreading Christmas costs and earning cashback
The credit cards available that can help shoppers spread the cost of Christmas and earn cashback on their spending have been revealed. Getting back a percentage of what you have spent as cashback or collecting points for retailers that can then be converted into money off vouchers are the most common offers available on the market.
The latest analysis of best buy cards from Defaqto reveals that it’s points based credit cards that are most common for those cards which also include a 0% purchase offer
M&S Bank’s Purchase Plus credit card is currently offering the longest interest-free period whilst also allowing you to gather points to save money down the line. Its 0% offer on purchases is for 20 months and cardholders get 1 point per pound spent in store, or 3 points per pound spent if you’re an M&S Club Rewards member.
The only card to offer a longer 0% purchase offer is Tesco Bank with its Clubcard Plus Credit Card which gives you 24 months interest-free on purchases whilst also gathering 1.25 points for every pound spent in store. However this offer is only open to Clubcard Plus members at a cost of £7.99 a month. If you are already a member however, then this card is worth considering.
Santander is the only one of the top five 0% cards that offers cashback not points. Its ‘All in One’ credit card has a 15 month interest free purchase offer and up to 0.5% cashback on spending. However there is a £3 monthly fee.
If you don’t plan to use a credit card for your December spending then Defaqto has also revealed which are the best current accounts to consider. These are current accounts that offer monthly cashback on purchases and the majority of the top five are even paying you to switch to them.
The current account from Chase has one of the best cashback offers currently available. You’ll get 1% on all spending up to £1,500 a month with maximum cashback limited to £15 a month. It is however one of the only accounts not offering a cash incentive to switch to them.
If you switch to Nationwide and its FlexDirect account then you’ll get 1% back on all spending and a one-off £175 payment for switching. The maximum cashback per month however has a much lower limit of £5 so consider if you would prefer money up-front or a higher cashback amount every month.
Both Chase and Nationwide’s cashback on spending is only for the first 12 months of the account being open. However Santander has two current accounts that give you money back each month on supermarket and travel spending for an unlimited period. These could be good options ahead of any Christmas food shopping or if you’ll be travelling via car, train or bus over the Christmas period.
The Santander Edge and Edge Up accounts charge a monthly fee of either £3 or £5 with the maximum cashback limit being slightly lower if you pay £3 per month (£10 vs £15 per month cap). They both however give you £150 to switch which could also be used towards that supermarket shop.
Katie Brain, Banking Expert at Defaqto said: “There’s a number of things to think about when choosing the right card or account for you. Consider where you do a lot of your shopping and which retailers you may use the most. If using a card which includes points then think about if you could benefit from building up points to use at a key shopping period or you could put them towards one-off larger purchases to save money. Finally, whether you’ll be using credit or debit cards, then consider any monthly charges that some accounts charge.
“It’s also worth using cashback sites like Quidco and TopCashback to gain even more cashback when making purchases online.”
Defaqto maintains the UK’s most comprehensive financial product database, providing independent expertise, insights, tools and technology to help everyone make smarter financial decisions, and has put together the above based on data available on 29th November 2024.