Can your card REALLY get you 6pc cashback?

ShOPPeRS are being offered up to 6 pc cashback for simply spending on plastic.

Card companies are locked in a war over perks as they try to sign up new customers.

But these cash rewards can be loaded with tricks such as introductory offers, a ceiling on how much you can earn and stringent terms and conditions.

annual fees of up to £25 are also muddying the waters and risk wiping out gains for borrowers who struggle to repay their spending each month.

‘These products are getting more complex and tend to favour certain shopping types — for example, only paying if you shop exclusively with a small number of retailers or if you’re a regular driver who fills their tank once a week,’ says Kevin Mountford, head of banking at price comparison website Moneysupermarket.

‘It’s vital to ensure you check the details and go for the one that best reflects your behaviour.’

The cashback card battle hotted up last week with the launch of Barclaycard’s latest deal.

With its offer of up to 6 pc on spending, it will pay £221 tax-free a year to anyone who piles £1,000 a month on to the card.

For a large family with big bills, 6 pc could add up to much more.

If your supermarket spend, fuel costs and general shopping added up to £3,000 a month, Barclaycard would pay you £521 each year.

But the card carries onerous terms and conditions.

The 6 pc is only for three months, and is limited to £120.

Barclaycard also insists you make at least 15 purchases a month to qualify for its 6 pc deal.

Fail to do so and you’ll earn only 0.5 pc on all spending.

In the second year you have the card, the loss of the 6 pc cashback will be keenly felt.

On a £10,000 annual spend (assuming five top purchases at £75 to meet further terms and conditions), the cashback drops from £175 to £110, calculations from Money saving expert show.

Similarly, american express offers 5 pc cashback, but only for three months. after this, the rate plummets to 1.25 pc.

Rival Santander pays up to 3 pc cashback, but it is specifically targeted — 1 pc on supermarket spend, 2 pc in department stores and 3 pc on petrol.

Spend £3,000 across 12 months — 10 pc in supermarkets, 10 pc on fuel and 5 pc in department stores — and the annual fee of £24 will actually leave you £9 worse off.

But for big spenders, it can be worth it.

Separate figures from Moneysupermarket highlight how a family spending £1,500 or more on the card each month, including lots on fuel — perhaps with two cars — would earn £272 a year.

On a £3,000 monthly spend, the annual benefit with Santander is £474.

But those looking to profit from their big fuel spend have their 3 pc cashback capped at £108 a year.

and the number of retailers allowing you the 2 pc cashback is limited. Worse, the bank makes it hard to see the names of retailers involved.

Though it includes Debenhams and John Lewis, rather than list these on its website, it asks you to type in the store’s name to see if it qualifies.

Cashback credit cards have mushroomed in popularity over the past few years, offering ever greater sums.

Lenders are keen to attract borrowers to reward cards, hoping they will slip up and not repay their debt every month — losing out on the cashback benefit.

‘This is why the golden rule for any borrower applying for a cashback card is to ensure your spending is always paid off each month,’ says Justin Modray at financial advice site Candidmoney.

‘The easiest way to do this is set up a direct debit that clears your debt each month. But make sure you’ve always got enough funds available to do this.’

Lenders are also tapping into demand from customers keen to trade their loyalty to a store for what is effectively money off.

In July, for example, asda launched its Money credit card. This pays 1 pc cashback on all in-store shopping and at any asda petrol station, plus 0.5 pc on all spending elsewhere.

Cashback cards will work only for borrowers who can be sure to repay all their spending each month.

If not repaying each month is a distinct possibility, instead pick a card that charges you the lowest interest on your spending.