Credit Card Review: Premier Credit Card From HSBC UK
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While the Membership Rewards programme from American Express is probably the most valuable ‘transferrable currency’ in the UK, HSBC also offers a rewards programme with great flexibility to move points to some of your favourite programmes.
Points can be earned through HSBC’s credit cards like the Premier Credit Card. However, this card has extremely restrictive eligibility requirements, which will exclude many hopeful travellers from applying.
Who Is This Card For?
First, the bad news. You need to have some serious investment with HSBC before the issuer will even consider you for this card. In order to apply, you need to have a HSBC Premier current banking account, which by itself does not sound onerous, but the requirements for opening this bank account are:
- A minimum of £50,000 held with HSBC, either in a savings account, or otherwise invested; or
- A ‘mortgage, investment, life insurance or protection product’ with HSBC and a minimum annual income of £75,000, which is more than twice the UK median income.
This card is squarely aimed at high-net-worth individuals who likely already have some serious money invested with HSBC. The problem is, this entry level card is not particularly lucrative for such tough eligibility requirements.
Sign-Up Bonus and Annual Fee
Fortunately, as this is an entry level card offering from HSBC UK, there is no annual fee for being a cardholder.
Unfortunately, there is no sign-up bonus either. So, while you’ll be earning points on everyday purchases without having to worry about an annual fee, you won’t be able to rake in a large sum of points for signing up and meeting a spend requirement.
Representative example: 18.9% APR variable with a purchase rate of 18.9% per annum variable with an assumed credit limit of £1,200.
Purchases on this card earn HSBC Reward points, which are their own unique currency.
You will earn 1 HSBC point per £1 spent on local purchases, and 2 HSBC points per £1 spent in foreign currencies. However, there is a 2.99% foreign transaction fee for all purchases in foreign currencies, which cancels out the points earned with foreign currency bonus category.
You can transfer HSBC points at a rate of 2:1 to programmes like British Airways Executive Club, Etihad Guest and Singapore Airlines KrisFlyer. So the earn rate is effectively 0.5 Avios per £1 spent, which is an okay rate for a non-American Express card.
If you spent £10,000 on the card in a year on local purchases, you’d bring in a total of 10,000 HSBC points. If you choose to convert them to British Airways’ Executive Club, you’d walk away with a total of 5,000 Avios. Based on TPG UK’s latest valuations, those 5,000 Avios are worth £60.
There is 0% interest on balance transfers for 18 months and on purchases for nine months from the account opening date.
You’ll receive extended warranty of up to two years for selected household appliances purchased on the card. You can also add a free supplementary card holder.
If you travel often, you’ll also get a basic LoungeKey membership, which is similar to the most basic Priority Pass membership. Note that you’ll still need to pay £15 per person, per visit to use each lounge. Similarly, you’ll also get free, unlimited Boingo Wi-Fi at over one million hotspots around the world.
Which Cards Compete With This Card?
If you are keen on earning HSBC Reward points, there is also a premium version of this card called the HSBC Premier World Elite Mastercard, which comes with a big sign-up bonus but an accompanying annual fee. It does also have an earn rate of twice this card.
For a no-annual-fee Mastercard, you could also consider the Virgin Atlantic Reward Credit Card. While the Flying Club miles earned don’t have some of the flexibility of HSBC points, there is a sign-up bonus and a better earn rate. So even if you meet HSBC’s strict eligibility requirements, the Virgin Atlantic card is still a better offer.
This is a strange product. On the face of it, it’s a simple entry level card with no annual fee, a fairly low earn rate considering the value of HSBC points and a handful of perks. But the eligibility requirements are sky high — much higher than some of the most premium cards available in the UK.
HSBC is clearly targeting this at customers who already have significant money with HSBC, or the means (and desire) to do so. But individuals with this sort of spending power would be better opting for more premium cards with far better benefits and point-earning capabilities, assuming they are comfortable with annual fees.
If you already have an HSBC Premier account but don’t want to pay an annual fee this may be a good option for a non-American Express credit card, otherwise it is hard to recommend.
You can apply for this card here.
Featured photo courtesy of Shutterstock.