Credit & Charge Card Reviews (9): HSBC Premier World Elite MasterCard

This is my review of the HSBC Premier World Elite 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 most 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 Tesco Clubcard MasterCard Low Rate card. This has a very attractive representative APR of 5.9% variable – and you can transfer your Clubcard points into Avios or Virgin Flying Club miles.

Key link: HSBC Premier World Elite MasterCard application form

Key facts: £195 annual fee, card only available to HSBC Premier current account holders

The representative APR is 59.3% variable, including the annual fee, based on a notional credit limit of £1,200.

About the card

The HSBC Premier World Elite MasterCard is issued by HSBC.

There are two versions of the card.  This review covers the more generous, premium version.  There is also a free version called the HSBC Premier MasterCard which I review here.

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 VERY 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.   The definition of this is not clear – a cash ISA does not seem to count but an equity ISA – where you can invest as little as £50 per month – seems to be OK given reader feedback.

HSBC Premier World Elite Mastercard credit card review

What is the sign-up bonus?

The sign-up bonus is VERY impressive.

You can earn up to 40,000 Avios or other airline miles in your first year.

You will receive 40,000 HSBC points, which convert into 20,000 Avios or other airline miles (Asia Miles, Etihad Guest, Singapore Krisflyer) if you spend £2,000 within your first three months.

You will receive an additional 40,000 points, worth an extra 20,000 Avios, if you spend a total of £12,000 in your first year. These will not arrive in your account until after your 12 months of membership irrespective of how quickly you hit the spending target.

Any other benefits?

Yes. You will receive access via the LoungeKey scheme to a large number of airport lounges.  I discussed the UK lounges which accept LoungeKey in this article – it is a decent list.

No free guests are allowed into the lounges. However, you can get a supplementary card for your HSBC Premier World Elite MasterCard for a £60 annual fee and that person can then access lounges with that.

The HSBC Premier World Elite MasterCard is not clearly better than American Express Platinum if you want a card with airport lounge access. It is cheaper (£255 for the HSBC card with one supplementary card vs £450 for Amex Platinum) but the Amex Platinum package has far more benefits – Hilton Gold, Melia Gold, Club Carlson Gold, Starwood Gold, Marriott Gold, Eurostar lounge access etc etc (see my American Express Platinum review for details).  For some people, however, HSBC Premier World Elite will be the right choice if you want airport lounge access.

If you have children, note that there is no way of getting a child into an airport lounge for free with LoungeKey. You are forced to pay the £15 guest charge, because obviously a child cannot be made a supplementary cardholder on your credit card account. With the Priority Pass issued by American Express Platinum, children can get into lounges for free – you get two cards and each is allowed one free guest.

The HSBC Premier bank account and credit card, between them, offer a range of financial and insurance benefits – see the website for details. A recent addition is a £20 Uber credit every time you spend £500 with an airline using the card.

There is also a range of benefits available to you as part of MasterCard’s general UK World Elite package. These include (but are subject to change):

  • Abercrombie & Kent VIP Travel
  • Corinthia Hotels special benefits
  • Fairmont Hotels and Resorts special benefits
  • Green Pearls special benefits
  • Mandarin Oriental special benefits
  • Raffles Hotels and Resorts special benefits
  • Small Luxury Hotels of the World 3-4-2 deal
  • Swissotel Hotels and Resorts special benefits
  • Leading Hotels of the World free Leaders Club membership
  • Hertz #1 Club Gold
  • Sixt – ‘exclusive benefits’
  • Shopping deals at Belstaff, Gieves & Hawkes, Turner & Asser, Hackett and others

I discussed the MasterCard UK World Elite benefits in this article.

What is the annual fee?

£195.

There is no fee for the HSBC Premier bank account which you also need to hold, 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?

HSBC Premier World Elite rewards scheme gives 2 points for every £1 spent in the UK and 4 points for every £1 spent abroad. Each point is worth 0.5 airline miles. This means that you earn 1 mile per £1 for UK spend and 2 miles per £1 for foreign spend.

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 1 Avios point per £1 spent, and 2 Avios per £1 for foreign spending, this is the most generous way to earn Avios via a Visa or MasterCard.

The free HSBC Premier card only offers 0.5 Avios per £1. 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 Avios Rewards card earns 0.25 Avios points per £1 spent on the MasterCard.

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!  My review of the Lloyds Avios Rewards card is here.

If you were planning to use this card to pay your tax bills to HMRC, be warned. As a World Elite card you will be charged a higher processing fee than a standard Visa or MasterCard, around 0.6% compared to the usual 0.38%.  In any event, HMRC will stop accepting personal credit cards for tax payments on 13th January 2018.

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 ASDA Cashback Credit Card which is free for life and offers 0.5% cashback. The representative APR is 19.9% variable.

For an average spender, the HSBC Premier World Elite MasterCard offers value as long as you believe that you can justify the £195 annual fee. This means that you need to place a lot of value on the LoungeKey airline lounge membership. Unless you are spending a six figure sum on your credit cards annually, paying £195 purely to receive 1 Avios point per £1 does not make sense.

For the first year, however, it is a different story. Earning 40,000 Avios or other miles as a sign-up bonus – as long as you can hit the £12,000 spending target – makes the £195 fee good value.

IMPORTANT – if you are just considering getting the card for one year, remember that you don’t receive the 2nd part of the bonus until your first 12 months is over. You may have to struggle with HSBC to ensure that you still receive the remainder of your bonus if you do not intend to pay another £195 fee.

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

A sign-up bonus of 40,000 airline miles – even with a £195 annual fee and £12,000 spend target – deserves to be looked at closely. Unless you are already a HSBC Premier customer, however, you need to weigh up whether you really want to move your banking over to HSBC for a benefit lasting only one year. I think most people would struggle to justify the £195 fee for the second and subsequent years.

The application for the the HSBC Premier World Elite MasterCard 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.

Bits: Loyalty Fraud Prevention conference, fixed Hilton / Iberia link, pretend to fly on a private jet
Credit & Charge Card Reviews (8): HSBC Premier MasterCard
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Comments

  1. I have this card since around 3 months. I have tried to use it twice to access lounge key lounges, 1st time at stansted I was refused access because lounge too busy. Yesterday at Heathrow T5 I was told I had to put my name on the list and wait outside approx.. 40 minutes which was not appealing.. Is this normal or I am just unlucky ? it makes me think that this major “benefit” is completely worthless. Any thoughts ?

    • It is normal at that Aspire lounge. Not normal elsewhere.

      However, the new Plaza Premium lounge opens in T5 in 2-3 weeks so the Aspire queue will go overnight.

    • Sadly it seems to be an increasing issue. Never used to have it in Edinburgh but now had it a couple of times, I suspect partly due to the upsell when booking parking – I suspect this gives them more revenue than PP do.

      Whilst speaking about lounges, don’t bother with the PP one in Venice. Only coffee or cold drink (ordered via the lounge host) and a single small biscuit with drink. That’s it!

  2. Does anyone know if HSBC runs promotions for increased transfer rate? I have have the card for over a year and have a significant amount of points. Shall I wait for a promotion or not?

    • For the last 3 Novembers they have done a bonus. Last year they said privately that it would not happen again. So far this November they have stuck to that.