New 5% cashback credit card from Sainsbury's
Filed under: Credit Cards
Sainsbury's has entered the cashback credit card market, with the launch of the Sainsbury's Cashback Credit Card offering a 5% return on your spending.
The headline rate is available on all shopping at Sainsbury's over the first three months, capped at £50 per month.
Best of all, there's no fee with the card.
Interest-free purchases and balance transfers
Somewhat unusually, the Cashback Credit Card also boasts some 0% interest periods that are not to be sniffed at.
There's 0% interest on purchases for six months, offering the chance to earn cashback on your spending without having to clear the balance all in one go. There's also 15 months of 0% interest on balance transfers, with a 3% balance transfer fee.
How does it compare?
The Sainsbury's Cashback card will certainly appeal to dedicated shoppers at the store. You get a decent return on your spending in store, and some attractive 0% periods to boot.
But unless you always do your shopping there – and at £250 a month, it's rather a lot of shopping – you may be better off with a rival card.
There are three main alternatives:
American Express Platinum Cashback
The American Express Platinum Cashback credit card pays 5% cashback in the first three months, capped at £100, no matter where you do that spending. After that there's a rate of 1.25% cashback, though this doubles in your anniversary month with the card to 2.5%.
However, the annual fee of £25 eats into your cashback return.
Capital One Aspire World
The Aspire World card from Capital One also pays 5% in the first three months (also capped at £100), but there's no annual fee to worry about.
The cashback rate you get after that depends on how much spending you do, up to a maximum of 1.25%.
Santander 123 Credit Card
Another card with an annual fee, this time of £24. The cashback rate you enjoy with the Santander 123 card depends on where you do your spending – you get 1% at supermarkets, 2% at department stores and 3% on fuel (capped at £9 per month)
One big bonus with this card is that the cashback is paid monthly rather than annually.
Check out The best cashback credit cards for more.
The Sainsbury's Nectar Credit Card
The cashback card is not Sainsbury's only new plastic offering. The supermarket has also revamped its Nectar Credit Card, offering a greater points return on spending than usual.
In the first three months with the card, for every £1 you spend at Sainsbury's you'll receive 10 Nectar points. That's FIVE TIMES the usual return. After that, you'll get back four points for every £1 spent at the supermarket.
The return for money spent elsewhere is not so good though – one Nectar point for every £5 spent on the card.
Not only do you get a boost to your points, but the Nectar Credit Card comes with the same interest-free periods as the Cashback Credit Card.
So that's 15 months of 0% interest on balance transfers (with a 3% fee) and six months 0% interest on spending.
How it compares
If you do all of your shopping at Sainsbury's and avidly collect your Nectar points, this card will look pretty tempting. Sainsbury's has been pretty clear that these cards have been designed with loyal shoppers in mind, and it shows.
But if you vary where you shop, or tend to stick to rival supermarkets like Tesco or Waitrose, this is not the card for you.
You can read more about the Nectar scheme and how it compares to other loyalty schemes in The top loyalty schemes for shoppers.
Getting a better 0% deal
Both of these cards offer interest-free periods on balance transfers and purchases. And while that's a nice bonus feature, there are far more lengthy deals on offer. If the main thing you're looking for from your new card is the 0% period, you should look elsewhere.
For example, on balance transfers Barclaycard has just revamped both of its Platinum credit cards, so that they offer 23 months and 22 months of 0% interest respectively (with 2.8% and 2.6% balance transfer fees). Read Barclaycard launches 23 month interest-free balance transfer credit card.
Indeed, there's a pretty wide range of cards offering 22 months of 0% interest, including from Sainsbury's supermarket rival Tesco. Check out Tesco increases Clubcard card balance transfer period for more.
And then on purchases, you can get a whopping 16 months of 0% interest on your spending with the top card – the Tesco Clubcard credit card.
There are 15- and 14-month 0% deals on offer from the Halifax All in One and Barclaycard 14/14 Platinum cards too.
Read The best 0% purchase credit cards for more.
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