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Lloyds launches new cashback reward credit card - is it any good?
Lloyds Bank has launched a new credit card offering 0.5%-1% cashback on spending, and travel rewards such as lounge access and skipping airport queues.
However, the Lloyds World Elite Mastercard won't be for everyone. It comes with a hefty £15 monthly fee (giving it a representative APR of 55%), so you'll need to spend a sizeable sum to be able to earn over £180 a year to break even.
Here, Which? takes a closer look at what the new deal offers, how much you need to spend to make the card worthwhile, and how it compares.
What does it offer?
The Lloyds World Elite Mastercard has a range of perks including cashback and travel rewards.
Cashback on your spending
You’ll get a rate of 0.5% cashback on your spending up to £15,000. If you spend more than £15,000 on the card in one year, you'll double the rate of cashback to 1%. After your account has been open for one year, your cashback rate will revert back to 0.5% and you'll need to spend a further £15,000 to trigger the 1% rate again.
Unlike other cashback credit cards, you won't have to wait a year for your money, as this is paid monthly the day after your statement date. But it won't be treated as payment for your card, so you'll need to continue making your minimum monthly payment on time each month.
You also earn cashback on spending abroad - but any foreign transactions will incur a 2.95% fee, so this might not be the most effective way to use the card.
- Find out more: best travel credit cards 2023
Travel perks
The World Elite comes with a Priority Pass membership, which gives you unlimited access to more than 1,300 airport lounges including London Heathrow, Edinburgh International, Orlando International and Dubai International - worth £419.
You’ll need to show your membership QR code or World Elite card to access the lounges and entry is subject to availability.
You can also skip the queues through security at participating airports, provided by DragonPass. To do this you’ll need to book your tickets in advance via the Mastercard Travel Experiences website or app.
In the UK, a fast pass is available at the following airports: Southampton, Luton, Newcastle, Leeds/Bradford, John Lennon, Glasgow, Edinburgh, George Best, Bristol, Dyce and Gatwick.
- Find out more: best and worst UK airport lounges
Secondary cardholder benefits
Most credit card providers will allow you to have a secondary cardholder to help boost your cashback at no extra cost, but with the Lloyds World Elite, they’ll also benefit from the travel perks as well.
This means couples could effectively ‘share’ the credit card, and split the monthly fee between them, and the cashback.
However, there will still need to be a primary cardholder, who is responsible for paying off the credit card balance.
Also, Section 75, which is the added protection you get on credit card purchases between £100 - £30,000, is watered down for secondary cardholders meaning you won’t be covered unless the primary cardholder still benefits from the purchase.
Find out more: Section 75 card protection: 5 things you need to watch out for
What's in the small print?
You’ll need to be a UK resident aged 18 and over to apply for the credit card and Lloyds advised you’ll need to complete an eligibility check before applying.
The purchase rate for the credit card is 22.94% variable and the card comes with a monthly fee of £15 so the overall representative APR is 55%.
The interest rate you pay will be linked to the Bank of England base rate, which means it will change automatically. That being said, if you pay off the card in full every month as we recommend with any cashback credit card you won’t pay any interest on your spending.
How much cashback could you earn?
We’ve crunched the numbers to see how much cashback you could earn each month based on different spending scenarios.
| Monthly spending | Yearly spending | Cashback earned per month with 0.5% rate | Cashback earned per year |
|---|---|---|---|
| £500 | £6,000 | £2.50 | £30 |
| £1,000 | £12,000 | £5 | £60 |
| £1,500 | £18,000 | £7.50 | £105* |
| £2,000 | £24,000 | £10 | £165* |
| £2,125 | £25,500 | £10.63 | £180* |
| £2,500 | £30,000 | £12.50 | £225* |
| £3,000 | £36,000 | £15 | £285* |
*When you spend over £15,000 a cashback rate of 1% applies on purchases above this threshold.
As the card costs £15 per month (£180 a year) you'll need to be spending at least £2,125 a month to break even. So you will need to be able to spend well above this and be able to pay it back each month to benefit from the card.
For example, if you consistently spent £3,000 on your card every month, after five months you’d have spent £15,000 on your card and qualify for the higher rate of cashback at 1%.
If you continued to spend £3,000 on your card each month for the remaining seven months of the year, you’d earn £210 in cashback in total, of which £105 would be pure profit after deducting the monthly fees.
- Find out more:best cashback and reward credit cards 2023
How does it compare?
If you; 're drawn to the cashback on offer on the World Elite, you might be better off with another deal.
For example, the American Express Platinum Credit Card has a lower annual fee of £25 and offers a higher rate of cashback.
You get 0.75% on all spending up to £10,000, and a cashback rate of 1% over this. It has a representative APR of 36.3% (variable).
When it comes to travel perks, it might be worth reviewing which benefits you’ll use the most.
If it's lounge access the American Express Preferred Gold Rewards Credit Card has no annual fee for the first year (£160 after), points on spending to use at retailers, and offers four airport lounge visits a year.
However, airport lounge access with the Elite World Mastercard is unlimited.
- Find out more: take a closer look at the best cashback and reward credit cards and best air mile credit cards
Is Lloyds Bank a good credit card provider?
Which? surveyed thousands of credit card customers in April 2023 to find out how satisfied they were with their providers.
We also asked them to rate the companies across a range of customer satisfaction categories, from the application process right through to the ease of banking online and customer service.
Lloyds Bank got a customer score of 69%, coming joint-19th out of 29 providers, alongside Halifax , Capital One and the Post Office
Customers gave it four stars out of five for its mobile app and three stars for its clarity of statement, customer service and transparency of charges. It received three stars for its customer service.
- Find out more:best credit card providers 2023
Should you get the Lloyds World Elite Mastercard?
The Lloyds World Elite card is aimed at big spenders who travel a lot.
The trick with this type of credit card is to put all your regular spending on it to boost your cashback, and then pay it back in full every month. This could include your groceries, travel and some household bills.
You need to spend at least £2,125 a month to earn enough in cashback to cover the £15 monthly fee. So if you can't afford to spend and pay back anywhere near that each month, and don't travel a lot to make use of the lounge access, the card is probably not a great fit for you.
That being said, if you're someone who already pays for a Priority Pass with unlimited access to airport lounges, you could potentially save money by taking out the card.
- Find out more: best credit card deals October 2023
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