What I hope to see from U.K. credit cards in 2020
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Looking back on the year, 2019 has seen ups and downs in the U.K. credit card market. We said goodbye to the last of the MBNA airline credit cards, as Virgin Atlantic shifted over to Virgin Money. Now, cards that could earn you miles directly with the likes of American Airlines, Etihad, Emirates and United are a distant memory in the UK.
With the EU’s cap on interchange fees limiting what card issuers can earn and therefore offer customers, there have been whispers that the death of rewards cards was just around the corner in the U.K.
Those whispers couldn’t have been further from the truth. The new Virgin Atlantic card offerings were very strong — cards that most of our team now have in their wallet. A Lufthansa Miles and More card hit the market this year, and Amex launched some new products and improved some existing ones — most notably, The Platinum Card from American Express, which now comes with a suite of new benefits as well as a higher annual fee.
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The U.K. credit card market is definitely not stagnant. If huge players like Amex are prepared to launch new products into market, I’m hopeful that signals there should be more goodness to come as we head into 2020.
So what would I love to see from the U.K. credit card issuers as we head into the new year? In a dream world, I’d love to see juicy sign-up bonuses to kickstart earning either in an existing currency like Avios or in a new currency (like Singapore Airlines KrisFlyer miles). Unfortunately, many of the sign-up bonuses are rather lacklustre, which doesn’t make signing up for a new card all that rewarding.
Related reading: The best U.K. miles and points credit cards of 2019
Along the same lines of earning, I’d also love to see stronger points-earning rates with multiples on different spend categories. For example, many credit cards in the U.S. have multiples on dining or supermarkets. Some cards in the U.K. currently have bonuses for spend on travel, though they’re typically limited. Across the board, I would love to see a card that offers bonuses for spending that’s not just with a single airline.
One of the most valuable perks out there right now comes in the form of the British Airways Companion Voucher, which you can earn after spending a certain amount with cobranded British Airways credit cards. In the future, I would be great to see even more exciting perks after hitting spending targets. Ideally, issuers will roll these out across different cards to offers perks like free nights or upgrades.
One of the most frustrating parts of the U.K. credit card market is that issuers largely still charge an archaic foreign transaction fee. Even cards that are branded as a premium travel card, such as the Platinum Card, still charge a ridiculous 2.99% fee on purchases made outside of the U.K. In 2020, I hope issuers considering removing the fee to encourage international spending on their cards.
Finally in 2020, I hope issuers consider adding more valuable airline or hotel status perks. While the Platinum Card does offer some hotel elite statuses as a complimentary benefit, I miss the days when you could get Cathay Pacific Gold status from the card. Similar airline elite statuses would be very enticing for a new product down the line.
In return for this dream shopping list, I — and many others — may be willing to shell out decent fees, understanding that the issuers have to make money somehow. The earning multiples and annual bonuses would work to encourage users to spend on a card year after year with no desire to cancel and shift to other products.
With the uncertainty of Brexit looming, who knows what is going to happen. The cap on interchange fees could be discarded, and issuers faced with the prospect of increased earnings may compete more aggressively for customers and ramp up offerings to entice sign ups.
This is pie in the sky for now, so all I really hope is that issuers continue to believe in the rewards card market, continue to improve products and launch new ones as they have done this year, and we will be here to advise and help our readers make the right choices and ultimately spend their hard-earned points to realise their 2020 travel dreams.
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