Supermarket Credit Cards Are They Value For Money?

Tesco Supermarket

There isn’t much you can’t buy in the supermarkets these days and this includes financial products and services.  However, despite all the inducements to take out a store branded credit card with the promise of extra reward points and promotional offers the real question should be, how do such cards compare to the market?

Example Supermarket Credit Card APRs

Sainsbury’s Bank – This supermarket offers one of the lowest costing credit cards in the market with the Sainsbury’s Low Cost Credit Card having an APR of just 6.9% making it one of the few cards to have an APR less than10%.  However in order to qualify for the card you will need to be an existing Nectar Card holder and have a good credit rating.  The supermarket also issues a number of other cards at the 16.9% APR level and a Gold Card with additional benefits at 20.1% APR.

Tesco Finance – This supermarket issues its own Tesco Clubcard Credit Card with a representative APR of 16.9% making it comparable to most standard cards offered in the supermarket sector.  As with all supermarket offering, the card it heavily linked to in store offers and the supermarket’s Clubcard loyalty scheme offering shoppers the chance to earn additional points on purchases.

M&S – The standard M&S credit card come in slightly cheaper than the standard offering of both Tesco and Sainsbury’s at 15.9% APR.  In addition, shoppers also receive an extended interest free period of 55 days assuming previous balances have been paid in full.  Additional benefits include the ability to collect “M&S Rewards” and card holders can upgrade to receive additional features for a monthly fee.

How Do Supermarket Credit Cards Compare To The Market?

In shopping around, don’t just compare supermarket credit cards with one another, here are some examples of typical rates which may be received on a range of credit cards from cards for poor credit to credit cards designed for online use:

• Mastercard Aqua (Poor Credit) 35.9% APR
• Visa Granite (Poor Credit) 34.9% APR
• RBS Your Points (Standard Card) 17.9% APR
• Capital One Click Card (Specialist Online Card) 9.9% APR

Overall, one can see that the supermarket offering come in pretty middle of the road with rates slightly cheaper than some high street banks but not in all cases offering consumers the best deal.

So if looking for a credit card, the supermarket offering is certainly worth a look.  However, in making you decision, think about the cost in terms of APR and consider carefully the real value of those extra points and promotional offers.