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Credit & Charge Card Reviews (11): HSBC Premier MasterCard

This is my review of the HSBC Premier MasterCard credit card.

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 to get your free Equifax credit report and score.  Your first 30 days are free then it’s £14.95 per month.  You can cancel at anytime.

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:  HSBC Premier MasterCard application form

Key facts:  No annual fee, card only available to HSBC Premier current account holders

The representative APR is 18.9% variable.

About the card

The HSBC Premier MasterCard is issued by HSBC.

It is a bit of an oddity amongst all of the other credit cards covered in this series for two reasons.  The first is that the airline rewards programme – whilst generous – is a sideshow to the rest of the card.  The second is that the card 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 button to see the details.

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.  HSBC has been known to waive the income criteria if you are on a career path which should see you earning this sort of money within a few years.

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.  Some readers have been told different things by different branches.

HSBC Premier MasterCard credit card review

What is the sign-up bonus?

There is no bonus on this card.

Any other benefits?

The HSBC Premier bank account and credit card, between them, offer a range of financial and insurance benefits – see the website for details.

What is the annual fee?

There is no annual fee.  There is also no fee for the HSBC Premier bank account, as long as you meet the eligibility criteria above.  If you currently pay for a ‘packaged’ current account with another bank you may save money by moving across.

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

Following a devaluation in January 2016, the HSBC Premier rewards scheme gives 1 point for every £1 spent in the UK and 2 points for every £1 spent abroad.  Each point is worth 0.5 airline miles.  You are therefore getting 0.5 miles per £1 spent in the UK and 1 mile per £1 spent abroad.

You can transfer your HSBC Premier points into the following airline schemes:

0.5 Avios per point

0.5 Asia Mile (the Cathay Pacific scheme) per point

0.5 Singapore Airlines KrisFlyer miles per point

0.5 Etihad Guest miles per point

The geographic base of these airlines is, perhaps not surprisingly, a good fit with HSBC’s main business focus these days.  Note the lack of any US airline partners.

Full details of the airline transfer scheme can be found here.

At 0.5 Avios point per £1 spent, this is the easiest way to earn Avios via a free Visa or MasterCard.

The Tesco Clubcard MasterCard only offers 0.312 miles per £1. You actually receive less because of the way it rounds down transactions to the nearest £8 – purchases under £8 earn nothing!

The Lloyds and TSB Avios cards earn between 0.2 and 0.3 Avios points per £1 spent.  You need to pay a £140 annual fee for the Lloyds Premier Avios card to receive the top of that range.  The HSBC card is 150% better than the 0.2 Avios earned per £1 on its nearest free competitor, the TSB Avios card.

Remember that the HSBC card has an FX fee of almost 3% for foreign currency transactions.  Despite the double points for foreign spending, 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 an Avios point worth?

This post outlines my view of what an Avios point is worth, based on your typical redemption patterns.

That said, I typically work off a conservative 0.75p per point – this ensure that I never make a bad decision when deciding whether to take part in a promotion or not.

How does this compare to a cashback credit card?

My default comparison card is the AA FuelSave Credit Card.  This card is free in the first year and offers 0.5% cashback on all spending, 2%-4% cashback on fuel purchases and – in year one – free AA breakdown cover.  The representative APR is 22.4% variable.

For an average spender, the HSBC Premier MasterCard offers acceptable value as long as you believe that you can get 1p or more from your Avios points.  The ability to transfer to Etihad and KrisFlyer as a back-up adds extra value.  The card is no longer a no-brainer, however, as long as the AA card continues to offer 0.5% back.

How else can you earn KrisFlyer, Asia Miles or Etihad miles from a UK credit or charge card?

Here are three good alternatives to the HSBC Premier card for these three airlines:

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 KrisFlyer, Asia Miles or Etihad Guest miles, amongst other airlines.

The American Express Platinum charge card offers 30,000 Membership Rewards points for signing up.  These convert to 30,000 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 miles in 29 different airlines, including KrisFlyer, Asia Miles and Etihad Guest.  It has a £75 fee, refunded pro-rata if you cancel.

Etihad Guest also has its own UK credit card which I review here.

Conclusion

There is no sign-up bonus on the card, so it is difficult to recommend the card on that basis!

However, it is – in terms of miles earned – still the most generous free Visa or MasterCard currently available despite the axe taken to the earning rate this year.

The application for the the HSBC Premier MasterCard can be found here.

(Want to earn more miles and points from credit cards?  Click here to visit our dedicated airline and hotel travel credit cards page or use the ‘Credit Cards Update’ link in the menu bar at the top of the page.)

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. OT. For those that took out the Virgin ISA for 12k miles when the offer first came out: we’re coming up to the 6 month min hold period such that you can close the account but still keep the miles.

    • Can I transfer it to another provider this year or I have to wait till next? If I can transfer it to another provider, is the portfolio replicated, or just the value gets transferred and I get to choose which shares/bonds to buy? Never held a stocks and shares isa before. Thanks.

      • You can transfer this year if you want but not all providers allow transfers in to their best rate ISAs. Depending on the provider, in-specie transfers are possible

    • I stupidly closed my ISA last week, I’ll report back if Virgin take back the points.

  2. Don’t forget that HSBC are also running a bonus offer at the moment that results in a 50% bonus for your avios transfer. So for the Premier Elite card, if you get to the £12k spend level, you could actually earn around 80,000 avios in year 1 (20000 1st bonus plus 20000 2nd bonus plus 12000 for spend = 52,000 with 50% bonus = 78,000). For £195, that’s a bargain.

    • That assumes the bonus comes back next year as you won’t get the points until after the current bonus ends.

    • Nick, hate to burst your bubble. But, by the time they grant us the second bonus of 20k, the 50% transfer bonus will expire, end of this month. So we will gain first 20k plus 12k for the spend, plus 50% of that total which is 16k more. 48k avios, plus obviously the extra 20k after the first yr end. So 68k which is good anyway, plus miles for whatever other spend we do. We did the 12 k spend quite quickly, but won’t get our bonus til next year. V frustrating, as we are keeping the card anyway, and as you say we could have earned the 50% bonus on that extra 20k too. Bit annoying.
      Think l might challenge that actually when we get back from HKT. What you think Rob? After all we are missing out on our 50% transfer bonus, on points on spend already earned!

  3. “You will receive points worth an extra 20,000 Avios at the end of your first year if you have spend a total of £12,000.”

    Does that mean you have to pay the second year £195 fee to collect the miles at end of year 1??

    • General guidance is that if you do not use the card post anniversary you can reclaim the fee when cancelling. FCA would take a dim view if not. MBNA does this on the Virgin cards.

  4. O/T but slight on as well. Does anybody know if a transfer from HSBC Premier rewards scheme qualifies for the current promo of “1,000 Avios in BA and avios.com for collecting with a new partner”? Obviously to BAEC only and if there hadn’t been another transfer since 3rd Oct 2015 from their scheme.

  5. Chewbacca says:

    What happens if you temporarily met HSBC Premier got the card and they downgraded your Premier current account? Is it correct that Premier criteria is salary only or any income as was advised by someone at HSBC that it was only salary and investment income would not be considered?

  6. what would be the charge to pay hmrc with this card