Credit card fees outweigh value of rewards

About half of all Australian credit card holders are getting no value from their credit card rewards because of fees.

Annual credit card fees are outweighing the value of bonus merchandise or air miles in most cases, it has been suggested,

Such cards only benefit high levels of spending, such as corporate expenses, if the amount is fully paid-off every month.

Only when credit card holders spent roughly $60,000 would they begin to reap the benefits. That amount would represent over three times the average $17,000 that Australians spend annually on credit cards. Even then, this figure is artificially heightened by very high spenders. Millions of cardholders in reality spend far less.

A monthly spend of $1,000 could see fees exceed potential benefits by as much as a third in value, even before interest is factored in.

Consumers are advised, then, to assess the structure of credit card deals and to carefully consider the fee to benefit ratio, to see if their average credit card spend will work out in their favour.

Could Which4U help you to find the right deal on your credit card? Why not check out our credit card comparison tables today and find out?

Joe Letts