NatWest's new credit card has 1% cashback on spending abroad - is it worth taking?
NatWest and Visa have launched a new credit card aimed at tempting holidaymakers
The NatWest Travel Reward Credit Card is aimed at customers who travel abroad frequently, and will offer rewards on purchases made with the card outside of the UK.
They can earn 1 per cent back in rewards on spending abroad, on purchases including plane and train tickets, car rental, ferries, buses, hotel accommodation, travel agents, cruises, campsites and more.
The deal goes up against the best cards for overseas spending, which can cut the cost of holidays.
Earn more on your holiday spending: The NatWest credit card with Visa lets customers earn 1 per cent back in rewards on spending abroad
The rate for spending in the UK on non-travel purchases is only 0.1 per cent - so it is unlikely to worthwhile for those who only go on holiday once a year.
The card has no foreign transaction fees on purchases abroad so can be used for fee-free spending.
The earnings are in the form of rewards points which can be converted into cash or vouchers to spend in shops.
Every time customers spend with the card, they can earn a percentage of rewards which can then be turned into cash or e-codes to be used at NatWest partner retailers.
Customers can see the rewards they have earned on the MyRewards section of the NatWest app.
If a customer were to spend £5,000 on flights, a hotel or car rental for a holiday, they would get £50 back in rewards which could be converted to cash.
The card comes with no annual fee and it has a purchase rate of 27.9 per cent.
Is it better than Starling, Monzo or Chase for holiday spend?
Where the NatWest travel credit card shines is on its 1 per cent rewards earn rate for spending abroad.
Rob Burgess said: 'What's attractive about the NatWest card is that the 1 per cent cashback on travel spend would stack with the FX-free fees, so not only would you get no FX fees on your hotel and car hire - if you paid locally for both - but you'd also get the 1 per cent on top.'
Digital Banks Monzo, Starling and Chase also offer fee-free spending abroad with perfect exchange rates.
For that reason they are the first choice of many Britons going on holiday.
However, Monzo and Starling don't offer rewards for spending abroad.
Chase offers 1 per cent cashback on spending with its current account and this also includes spending abroad. Customers need to pay in £1,500 a month to their Chase account to get the cashback, and cashback is capped at £15 a month.
Barclays launched a new credit card in partnership with Amazon last week. It lets users earn 1 per cent cashback rewards on all Amazon purchases and 0.5 per cent on purchases outside of Amazon for the first six months, after that it drops to 0.25 per cent.
Other credit cards like the Marks & Spencer card, the John Lewis Partnership Card or the Sainsbury's Nectar Mastercard credit card offer between 0.1 per cent and 0.25 per cent back in rewards, so the NatWest card earn rate for UK and non-travel spending does not look massively attractive.
Rob Burgess added: 'Where the NatWest card fails is the 0.1 per cent return on general spending. This is okay for overseas spending, but it a terrible return on your UK pound spending.
'A card like the Barclaycard Avios Mastercard - which is free and earns one Avios per £1 - should effectively get you 1 per cent back on UK spend if you use your Avios wisely and in the worst possible scenario - converting them to Nectar points - you'd get 0.5 per cent back.'
'Everyone should have an FX-free card to use outside the UK and - as this card is free - its as good as any alternative.'
'The NatWest card is worth having for someone who spends a lot of abroad, especially someone who stays in smart hotels where the hotel bill is a large percentage of their overall holiday cost since you get the 1 per cent back plus 0 per cent FX, but I'd keep it in a drawer when not travelling.'
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Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence. *Chase: Cashback available for first year. Exceptions apply. 18+, UK residents.
