Think twice on rewards credit card, customers advised

04/12/2009

Customers should "think carefully" before applying for a new credit card deal from American Express, Moneyextra.com has suggested.

Peter Gerrard, a finance expert from the price comparison site, said that the zero per cent deal available for users of the Express Rewards Credit Card would not last forever.

The deal offers customers the chance to generate reward points through purchases, which are later exchanged for gift vouchers to spend in various high street retailers.

New customers get zero per cent on purchases for the first six months only, after which the typical APR increases to 17.9 per cent.

This means that cardholders might suffer from sharply rising balances if they do not pay off their purchases immediately - and could eventually require debt help.

Mr Gerrard said: "Anyone who uses the card should clear the balance in full each month. In addition, you need to make some large purchases to see any rewards.

"As an [example] £1,600 spent in a major supermarket will equate to just £25 of vouchers."

Tags; Debt Management and Banking, Credit Card Lifestyle, Recent Graduate Debt,

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