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HSBC Premier Mastercard cuts its rates but is still the best non-Amex Avios card

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The devaluation of loyalty credit cards, at least those with a Visa or Mastercard logo on them, continues.  This is driven by the new EU regulations on interchange fees, which will cap the amount shops can be charged for accepting Visa or Mastercard at a pitiful 0.3%.  These come into force on 9th December.

We have already seen Tesco halve the earnings rate on the Tesco Clubcard Mastercard.  Marriott has also closed its Mastercard to new applicants.  Examples of changes to non-airline cards include NatWest closing Your Points and House of Fraser halving the voucher earning rate on its Mastercard.

HSBC Premier has become the next to fall into line.

For spending in the UK, the earning rate will halve on 21st January.  The rate for overseas purchases will remain unchanged, but the card does have a 3% fee on foreign transactions.

Under the new structure, the HSBC Premier rewards scheme will give 1 point for every £1 spent in the UK.

You will be able to transfer your HSBC Premier points into the following airline schemes:

0.5 Avios per point

0.5 Asia Miles (the Cathay Pacific scheme) per point

0.5 Singapore Airlines KrisFlyer miles per point

0.5 Etihad Guest miles per point

The irony is that, even after the earning rate is halved, the HSBC Mastercard will remain the easiest way to earn Avios via a Visa or Mastercard at 0.5 Avios per £1.

The Tesco Clubcard Mastercard now only offers 0.312 miles per £1 (and you actually receive less because of the way it rounds down transactions).  The Lloyds and TSB cards do not offer more than 0.25 Avios per £1.

Here’s the snag ….

The HSBC Premier Mastercard can only be obtained if you have a HSBC Premier bank account.

HSBC Premier has tough eligibility criteria.  See here and click on the Eligibility tab.

As well as opening a HSBC Premier current account, you must ALSO have £50,000 invested with HSBC, either in a savings account or via an investment product.  Alternatively, if you earn over £100,000, you qualify if you just have a HSBC mortgage or any investment or insurance product.

I’m not sure what the minimum investment is in an ‘investment product’ but I’m sure you could find something which would accept £1,000 or so.  They may even treat ISA’s or fixed rate bonds as ‘investment products’ – the definition is not clear online.

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In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

Barclaycard Avios Plus card

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You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

British Airways American Express Premium Plus

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American Express Preferred Rewards Gold

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The Platinum Card from American Express

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Virgin Atlantic Reward+ Mastercard

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Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.

British Airways Accelerating Business American Express

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American Express Business Platinum

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American Express Business Gold

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Capital on Tap Business Rewards Visa

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For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.

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Category

HSBC Premier Mastercard

Comments (51)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • MikeW says:
    24 Nov24 November 09:03

    Insurance definitely the way to go – I applied for HSBC Premier and was told that I had to have an investment though their ‘advised’ service – an execution only Cash or S&S ISA doesn’t count.

  • Neil says:
    24 Nov24 November 09:17

    Unfortunately the cap isn’t on the maximum shops can be charged. It’s worse than that it’s the maximum visa/MasterCard can charge the banks. The shops , especially small shops, can still be charged a lot more. There is unlikely to be a dramatic saving for most small businesses. Only those large corporate businesses will see the rate reduction passed onto them.

    • Metatone says:
      24 Nov24 November 13:57

      Yes, this is what is most frustrating about the whole situation, IMO.
      Not only will we, the end consumer, never see these savings (large shops will not drop prices because of reduced transaction fees), small shops who I might sympathise with on CC fees won’t even get them, it’ll go to the banks.

  • Matt says:
    24 Nov24 November 09:21

    All Visa and MasterCard cards will go this way sooner or later…. As they use the interchange fee to “buy” rewards for their cardholders.

    Amex will become a dilemma for some merchant as Amex isn’t subject to the interchange caps at the moment, but that also means that accepting a consumer Amex card will be several times more expensive than VI/MC. So whilst consumers who prefer rewards may prefer Amex, for merchants it may increase costs.

    • Alan says:
      24 Nov24 November 09:23

      Although as Neil just pointed out above, the final costs to the shop might not be quite as different as the reduction in interchange fee suggests, which might make it a bit less of a differential.

    • RIccati says:
      25 Nov25 November 06:15

      As informed consumers, we can go the other way. Whenever possible, switch to businesses that accept AMEX. Have a meal at a hotel rather than a local place, etc.

  • Simmo says:
    24 Nov24 November 09:23

    O/T How long does the transfer from Heathrow Rewards to BA usually take? Still waiting for mine

  • Kai says:
    24 Nov24 November 14:07

    OT & also related to Heathrow Rewards. I registered last week using the BA promo code but I can’t find the welcome offer under My offers/rewards section in my account. Is there a way to confirm that I’m registered for the 3000 bonus points promotion?

  • Duncan Stevenson says:
    24 Nov24 November 15:53

    Is the £100,000 income household or personal for the HSBC eligibility?

    • Jonathan says:
      24 Nov24 November 16:20

      Personal I believe

      • PeteT says:
        24 Nov24 November 16:28

        I don’t earn anywhere near £100k or have £50k invested. My business banking has been with HSBC since 1971 and my personal banking since 1985. When I applied for a mortgage, they offered me Premier.

        • Rob says:
          24 Nov24 November 16:54

          In my experience, they are also willing to take you if you are on a career path that will see you earning £100k within a few years.

        • Jason says:
          24 Nov24 November 21:57

          You deserve something for that loyalty 🙂

  • tall trader says:
    25 Nov25 November 22:01

    just got my letter today. that sucks.
    i guess that makes the amex green not so bad after all in terms of a reward card with optionality to use points…

  • Louie says:
    26 Nov26 November 10:31

    Does anyone know if there are now any other Mastercard/Visa cards offering better rates for non-BA airline earning? The best feature of the HSBC card has for me always been that I can transfer to airlines other than BA, deciding on which airlines at the time of transfer depending on my plans at the time. I know there are other airline-specific MBNA cards which I believe match but do not better the new rates, but I would prefer to be able to continue to transfer miles to a range of airlines. I suspect HSBC will still be the best option, but if anyone knows different I’d be grateful.

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