Credit & Charge Card Reviews (23): Virgin Flying Club White American Express & Visa

This review was updated on 29th July 2016 and all the information is correct as of that date

This is my review of the Virgin Flying Club White credit cards.

It is part of my series of articles looking at the major UK loyalty credit cards and discussing whether or not they are worth applying for.  These articles will be linked to the relevant sections of the ‘Credit Cards Update‘ page.  My other UK airline and hotel credit card reviews can be found here.

If you want to check your credit record before applying for a new card, click here for a free 30-day trial of Equifax’s online credit report service.  Note that a monthly fee of £14.95 will be charged if you do not cancel during the 30-day free trial period.

As with all rewards cards, this is not a suitable product for you if you do not clear your balance in full every month.  You should focus on a credit card with a low interest rate such as the AA Low Rate Card. This has a very attractive representative APR of 6.4% variable on purchases and balance transfers.

Key link:  Virgin Flying Club White American Express and Visa application form

Key facts:  No annual fee

The representative APR is 22.9% variable.

About the card

The Virgin Atlantic White credit cards – issued by MBNA (Bank of America) – come as a double-pack of an American Express and a Visa card.  This model may not continue into the future as Amex fees on co-brand cards to UK retailers are now capped at the same level as MasterCard / Visa at 0.3%.

MBNA also issues the United, American Airlines, Emirates and Etihad and Lufthansa credit cards, amongst others. This may impact your ability to get the Virgin card if you already hold an existing MBNA product, although if you are refused MBNA is often willing to reconsider if you reduce your credit limit on another card.

What is the sign-up bonus?

The current sign-up bonus is 3,000 miles.  You will receive this after making your first purchase within 90 days.  Occasional bonuses can see this increase to 10,000 miles.

It is important to note that MBNA treats the Virgin White and Virgin Black credit cards as separate products.  You can apply for both and receive a sign-up bonus on both.  You can even hold both at the same time, which is not the case with the British Airways American Express cards.

MBNA does not allow you to churn its cards.  If you cancel this card and later reapply, you will not receive another bonus.  In reality, if you wait a few years then your odds improve and you may get lucky.

Any other benefits?

Yes. The Virgin White credit card comes with two interesting bonuses:

When you spend £10,000 on the free American Express card, you will receive an upgrade to Premium Economy (for one person) when you redeem your Flying Club miles for an Economy class redemption. A 2nd voucher is available when you spend £20,000.  You only receive your voucher at the end of each card year, irrespective of when you pass the spend target.

Spend £15,000 on the free American Express card and you will receive a free ticket for a companion (taxes apply) when you purchase a full fare (booking class Y, B, R, L, U, M, E, Q, X, W, S, H and J) cash flight.  This voucher is issued as soon as you have passed the spend threshold.

These offers are less interesting than you think. The Premium Economy upgrade is OK, but only covers one person per voucher.  The way the voucher works is that you need to see Premium Economy redemption space available but you are only charged the miles of the equivalent Economy redemption.  Having to wait until the end of your card year before you receive it decreases its value.

The free companion ticket has got easier to use recently.  In early 2016, Virgin extended it to some of the cheaper – but still not cheapest – ticket categories.  However, for many it remains fundamentally useless since very few people buy flexible or semi-flexible cash tickets.

I know that some people can get this to work in certain circumstances.  You will have most success in Premium Economy where an ‘H’ class fare may only be a hundred pounds or so more than the cheapest cash ticket, but this requires some knowledge of the Virgin ticketing system and good timing.  In any event, your second ticket will still not be ‘free’ because the ticket you buy will cost more than the cheapest available one, and the taxes element must still be paid.

Note that Visa spend does not count towards the vouchers.

Virgin Flying Club White credit cards review

Is there an annual fee?

No, there is no fee.

What do I earn per £1 spent on the card?

You earn 1 mile per £1 spent on the Amex card and 0.5 miles on the Visa. This is not a bad return on the Visa when you remember that you can’t get better than 0.3 Avios per £1 on an Avios card these days – even a paid one – unless you meet the strict HSBC Premier qualifications.

Bookings with Virgin Atlantic or Virgin Holidays earn double miles. However, the Virgin website charges a whopping 1.5% fee with no cap for using credit cards and this is NOT waived when using the Virgin card.

Remember that the Virgin Atlantic cards have an FX fee of almost 3% for foreign currency transactions.  You may want to consider getting a separate card to use abroad which charges no foreign exchange fees.  I recommend the Lloyds Avios Rewards card which also earns Avios points – even on your 0% FX transactions!  It comes with a 4,500 Avios sign-up bonus if I refer you.  My review of the Lloyds Avios Rewards card is here.

What is a Virgin Flying Club mile worth?

This is clearly a ‘finger in the air’ exercise. I would, however, flag some key pointers.

Virgin has a lot of partners. You can earn miles by converting Tesco Clubcard points as well as Heathrow Rewards and American Express Membership Rewards points. Even if you never fly with Virgin, you could easily top up your credit miles with Tesco points to reach enough for an award. They also have particularly good earning rates with Hertz. There is also this on-going deal for 6,000 free Virgin Flying Club miles for opening a Virgin Money ISA.

As with BA, long haul economy redemptions are often poor value due to the taxes and fuel surcharges. However, Virgin reduced its taxes on economy redemptions and they are now up to £120 per person lower than BA would charge. Long-haul premium cabin redemptions are in line with BA in terms of taxes but generally require fewer miles after the Avios devaluation of April 2015.

You can transfer Virgin miles to Hilton HHonors at a 1 : 1.5 ratio which puts a floor under their value. You can also transfer to IHG Rewards Club at 1 : 1.

I would therefore be happy to value Virgin miles at 0.75p – 1p each, in line with Avios.

How does this compare to a cashback credit card?

The best cashback card on the market which offers a) a MasterCard or Visa, b) no annual fee and c) unlimited cashback is the Asda card, which pays 0.5%.

The Virgin Flying Club American Express is therefore OK, albeit more marginal on the Visa card.

How else can you earn Virgin miles from a credit or charge card?

There are three other options worth considering, one of which is initially free:

The American Express Preferred Rewards Gold charge card offers 20,000 Membership Rewards points for signing up and is free for the first year.  These convert to 20,000 Virgin miles.

The American Express Platinum charge card offers 30,000 Membership Rewards points for signing up.  These convert to 30,000 Virgin miles.  It has a £450 fee, refunded pro-rata if you cancel.

The Starwood Preferred Guest American Express credit card offers 10,000 Starwood Preferred Guest points for signing up.  These convert to 10,000 Virgin miles.  It has a £75 fee, refunded pro-rata if you cancel.

Conclusion

A sign-up incentive of 3,000 miles is not exceptional, even for a free credit card.  Unless you are a big spender you maybe better off waiting to see if a 10,000 miles offer returns.

The on-going earning rate is not bad.  1 mile per £1 on the Amex is OK and equivalent to the free British Airways American Express. 0.5 miles per £1 on the Visa is very good for a free card but you need to question whether this rate is sustainable given the new EU caps on credit card fees charged to retailers by Visa and MasterCard.

The application form for the Virgin Flying Club White credit cards can be found here.

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history. By recommending credit cards on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

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Comments

  1. Metatone says:

    Anyone have a “finger in the air” description of Virgin redemption availability compared to BA for flights across the Atlantic?

    • Sebastian says:

      If you want economy or PE and you’re on the ball (I.e. Book well in advance) I find Virgin availability to be good even to places such as Cancun in School hols such as Oct half term and summer. To be honest, Orlando is always hard to find and I’ve not tried the Far East or African redemptions (I use BA for those) so my experience is mainly with the States.

      • avidsaver says:

        I think you will find you can’t use flying club miles on the Virgin Orlando route.

    • I find it much better than BA, particularly for my family of four in upper class. In the last couple of years I’ve booked four upper class to Washington, D.C., Las Vegas, Antigua and Barbados in the summer holidays. If you’re not interested in the USA though I’d stick to BA. You can check mileage seats by doing a dummy booking on the Virgin website. Choose a destination and any old dates and click the book with miles option, this brings up a chart of the whole months redemptions (red for economy, pink for PE, purple for upper). From here you can click any month on the left hand side of the chart and thus check a whole years availability very easily.

      • Pol – do you normally book two one ways with virgin or can you book out journey then add the return to an existing booking later. We have enough virgin miles to do an upper class out to America and we can use the upgrade PE voucher back. Hope to book once we get the voucher in May.

        • It depends. The Caribbean is very little price difference when booking as two one ways so I’ve always just done that when they come available. The USA is more expensive to book 2 one ways so I book the outward as a one way when it becomes available and call to ask about adding the return at uk prices and so far they have always been happy to do this.

          • Great thanks Pol ! I’ll try the same!

            • I have just done this to Orlando in October school holidays from Glasgow and they added in the return no problem. Works out cheaper than BA and if you are on the ball availability is good.

    • Infinitely better. Check most BA destinations and there is literally zero CW availability for months in advance. Virgin invariably has a few dates available for most months and seems to release more seats more often.

  2. Sebastian says:

    I’ve got the black card at the moment as my main card as I feel due to my Avios balance being relatively high with 2 241’s and having a decent amount of Etihad points, it was probably wise to diversify my points. At the moment, I am finding the two/one point per £, excellent (I never got a BMI card :(). However, I’ve got to agree the Virgin 241 is useless except in very rare circumstances and the insistence on not posting the vouchers until the year end is very annoying. For me you should only get this card if you’ve got a lot of ongoing spend and fly to the States on a regular basis.

  3. I took out the virgin cards initially for miles and planned on cancelling the black one before the second annual fee is due. However, I regularly get 0% interest for 12 months MONEY TRANSFER offers at 2% handling fee on my Virgin cards which make them very valuable for me as I am getting a hassle free below market rate sort term loan should I require it (and I have made use of it from time to time). I have kept them for this sole reason and don’t mind paying the annual fee for the black one as I have got a higher credit limit on that than the White card!! No other card (including others from MBNA) has ever given me such a generous offer.

    • But you’re still paying the £140 annual fee on the black for your 0% transfer.
      So it is not that attractive.
      The best attraction to the Black Card imo is the E to PE upgrade only needing £5000 spend to activate & £10000 for a 2nd.

      • yes ofcourse it would have been better if there was no fee but even including the 140 fee I got a better rate(c.3.5% including all fees) than a consumer loan from a Bank but unlike a consumer loan I only pay 1% of loan for first 11 months and since I have both the black and white cards ..I have option of refinancing for another year (which I have already done) and so on. If I did not have the virgin cards I would have approached a Bank due to change in my personal circumstances so the ability to have this liquidity from comfort of my home without any bank applications, documents, additional credit checks etc is worth the 140 to me. Ofcourse doesn’t work for anyone just looking for some arbitrage.

  4. is there a higher referral bonus for the black card?