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 Black 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 apply following the 30 day free trial of this product if you do not cancel within the trial period. You can cancel your subscription at any time.
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 facts: £140 annual fee
The representative APR is 57.4% variable, including the annual fee, based on a notional £1,200 credit limit.
About the card
The Virgin Atlantic Black 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, 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.
What is the sign-up bonus?
The current sign-up bonus is 18,500 miles. You will receive the miles with your first purchase within 90 days.
Occasional special offers can see the bonus raised to 25,000 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 credit cards, both free and paid, come with two interesting bonuses:
When you spend £5,000 on the Black 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 £10,000. These vouchers are issued at the END of your card year, not when you pass the spend target.
Spend £7,500 on the Black 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 pass the spend threshold.
As I wrote in my review of the Virgin White credit card, these offers are less interesting than you think.
The Premium Economy upgrade is OK, but only covers one person per voucher – you would need to spend £10,000 to receive both to cover a couple. 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 them decreases their 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.
Is there an annual fee?
Yes, £140 per year.
Unlike Amex-issued cards, you do NOT receive a pro-rata fee refund if you cancel.
What do I earn per £1 spent on the card?
The earnings rate on the cards is very good.
You earn 2 miles per £1 spent on the Amex card and 1 miles on the Visa. This is an excellent return – there are no Avios cards which reward you so well, even the paid ones.
Bookings with Virgin Atlantic or Virgin Holidays earn double miles. However, the Virgin Atlantic website charges a whopping 1.5% fee with no cap for using credit cards, and this is NOT waived when using the Virgin card – although you may find that earning 4 miles per £1 outweighs the 1.5% charge.
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?
I covered this in my review of the free Virgin White credit card.
To recap: Virgin has a lot of partners now. 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 has 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 also 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%.
Whilst this card does carry an annual fee, the earnings rate is still excellent. Even on the Visa card, 1 mile per £1 offers a very decent return if you use the miles wisely.
How else can you earn Virgin miles from a credit or charge card?
There are three options worth a look, one of which is initially free:
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.
18,500 miles, the current bonus, is a good deal albeit that you are paying a non-refundable £140 annual fee.
The on-going earning rates on these cards are as strong as anything on the market. 2 airline miles per £1 on the Amex is very impressive and is matched only by the Emirates Elite card. Emirates Elite is also the only card that can match £1 mile per £1 on a Visa or MasterCard.
The application form for the Virgin Flying Club Black 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.