The best UK credit cards with no annual fee for 2021

Apr 5, 2021

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Editor’s note: This story has been updated with new information.


If you’re looking for a great card to earn some valuable rewards without paying an annual fee, here are our picks for the best credit cards with no annual fee available in the U.K. for 2021.

Firstly, note that while there are no annual fees for these cards, they will typically come with fewer rewards and benefits than similar cards that do carry an annual fee. For example, the welcome bonus may be significantly lower, the earning rate may be lower and it may require more spending to reach rewards. If you are looking to earn rewards faster, you may wish to compare these to the best cards that do have annual fees and better rewards.

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1. THE BRITISH AIRWAYS AMERICAN EXPRESS CREDIT CARD FROM AMEX U.K.

Welcome bonus: 5,000 British Airways Avios after spending £1,000 in the first three months.

Earning rate: 1 Avios per £1 spent on all purchases; unfortunately no bonus for spending directly with British Airways or BA Holidays.

Other key benefits: 2-for-1 Companion Voucher earned after £20,000 in annual spend on the card. The Companion Voucher is the most valuable credit card benefit out there, allowing you to take a companion with you on the same flight and in the same cabin when you redeem Avios for a British Airways reward flight. Of course, taxes, fees and other carrier charges still apply to the companion. Note that when earned with this card, the Voucher is valid for only one year.

Representative example: This credit card has a representative APR of 22.2% variable and a purchase rate of 22.2% variable with an assumed credit limit of £1,200.

Why it’s great: The 2-for-1 Companion Voucher is the most valuable benefit in the U.K. reward credit card market. And subject to various rules, it gives you a free ticket when you make a redemption using your Avios, effectively doubling the value of your pool of Avios if used correctly.

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2. VIRGIN ATLANTIC REWARD CREDIT CARD U.K.

Sign-up bonus: There is currently no sign-up bonus on this card.

Earning rate: 0.75 Virgin Points per £1 spent on everyday purchases; 1.5 Virgin Points per £1 spent with Virgin Atlantic or Virgin Holidays

Other key benefits: You’ll unlock a Virgin Atlantic reward after spending £20,000 annually. Options vary, depending on the level of status you have with Flying Club. The value of the Virgin Atlantic reward is highest if you’re a Flying Club Gold member, where you can effectively get a companion voucher on any redemption flight in any cabin of service.

Representative example: This card has a representative APR of 22.9% variable, and a purchase rate of 22.9% variable with an assumed credit limit of £1,200.

Why it’s great: Because this is a Mastercard, you’ll have a back up in situations where Amex may not be accepted. With no annual fee and ongoing earning rate of 0.75 miles per £1 spent on everyday purchases and double that for purchases made directly with Virgin or Virgin Holidays, you’ll have an expedited way to getting an Upper Class redemption.

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3. THE PLATINUM CASHBACK EVERYDAY CREDIT CARD FROM AMERICAN EXPRESS U.K.

This card is a little different as it earns cashback rather than points or miles, but with no annual fee, is also a solid offering.

Welcome bonus: You’ll receive 5% cashback on all purchases (up to £100 in total) for all purchases made during your first three months after you activate the card. You would need to spend £2,000 in that period to receive the full £100 cashback.

Earning rate: After the first three months of card membership (where you’ll earn the 5% cashback), you’ll then earn:

  • 0.5% cashback for the first £5,000 spent on purchases; and
  • 1.0% cashback after that first £5,000, with no limits.

Other key benefits:

  • You can opt to have free supplementary cards for any close family and friends in order to maximise your cashback.
  • There’s travel accident insurance for up to £150,000 for public transport when you use the card to purchase that transport.
  • Global Assist 24/7 assistance when you are travelling abroad.
  • Purchase and refund protection for eligible items (conditions apply).

Representative example: This card has a representative APR of 22.2% variable, and a purchase rate of 22.2% variable with an assumed credit limit of £1,200.

Why it’s great: There’s no annual fee, so provided you’re able to spend the full £2,000 in the first three months, you’ll come out £100 in front.

Further Reading:

Honourable Mention: AMERICAN EXPRESS PREFERRED REWARDS GOLD CREDIT CARD

Welcome bonus: 20,000 Membership Rewards points after spending £3,000 in the first three months.

Earning rate: 1 Membership Reward point per £1 spent on all purchases; 2 Membership Rewards points per £1 spent directly with airlines or in a foreign currency (though you’ll have to pay a 2.99% foreign transaction fee); 3 Membership Rewards points per £1 spent at American Express Travel.

Important to note: This card has no annual fee for the first year, though it carries an annual fee of £140 per year for the second and subsequent years.

Other key benefits: Two annual Priority Pass lounge passes to make your airport experience more enjoyable. The visits must be made in the Priority Pass network, which boasts more than 1,200 lounges worldwide.

Representative example: This card has a representative APR of 56.6% variable and a purchase rate of 22.2% variable with an assumed credit limit of £1,200.

Why it’s great: The American Express Preferred Rewards Gold Credit Card is our top pick for the beginner to the miles and points game. A 20,000 Membership Rewards-point welcome bonus, no fee for the first year and great point-earning structure make this card a no brainer. Plus, you’re earning Membership Rewards points, which are a transferable currency, allowing you to shift your points to any of Amex’s 17 partners. For example, 20,000 MR points can be transferred to British Airways Avios for multiple return flights to many destinations in Europe.

Further Reading:

Bottom line

Cards with no annual fee can be a cost-effective way of earning rewards, and there are some solid options in the U.K., especially if you are new to the points and miles game. Just be aware that where you are looking at cards that do carry an annual fee, the rewards such as welcome bonuses, earning rates and travel perks are likely to be much more lucrative.

Featured image by Josh Gribben

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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