What is the best replacement for the UK Etihad Guest credit card?

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MBNA has written to holders of the Etihad Guest UK credit cards this week to tell them that they are closing on 27th July.

Quite a few readers may have this card as there were some VERY generous sign-up bonuses over the years.  It reached 25,000 miles at one point which was great for a free credit card, especially as you could pool the miles in a family account.

Today I thought I would run through the options if you still want to collect Etihad Guest miles from a credit card, or want an interesting alternative from another airline.

UK Etihad Guest credit cards closing

Why did this happen?

You should NOT assume that these cards will return under a new issuer.

Two linked events caused this.  The core driver was the European Union cap on interchange fees.  This restricted the fee that payment processors could charge retailers for accepting credit cards to 0.3%.   It is very difficult to run a successful mileage card on this basis.

The second driver was American Express being caught up in the 0.3% cap, even though it was originally expected to be exempt.  American Express decided to pull all of its licensed cards from the market, which means that MBNA, Lloyds, TSB and Barclays had to stop issuing Amex-branded products such as the Etihad Guest cards.

Best American Airlines UK credit card replacement

What is your best alternative to the Etihad Guest UK credit card?

There are a number of ways of looking at this.  Let’s run through them.

Scenario 1:  You want a card which still lets you earn Etihad Guest miles at a decent rate

The good news is that there are still ways to earn Etihad Guest miles from a credit or charge card in the UK.  The earning rate is OK too.

The highest miles earning option is the Starwood Preferred Guest American Express credit card.   You earn 3 points per £1 spent, and these convert at 3:1 into Etihad Guest miles.  If you convert in chunks of 60,000 points you get a 5,000 mile bonus, meaning that you are actually getting 1.25 Etihad miles per £1 spent.

It isn’t as generous as the MBNA credit card, which gave 1.5 Etihad miles per £1 on the American Express element and had no fee, but it isn’t bad.

The annual fee on the SPG card is £75 and you get a sign-up bonus of 30,000 points (10,000 Etihad miles).  This makes the card well worth getting for the first year at least.

Your other option is one of the two Membership Rewards cards – either American Express Preferred Rewards Gold or American Express Platinum.

These cards give you 1 Membership Rewards point per £1 spent, and they convert at 1:1 into Etihad Guest.  This means that you are getting 1 Etihad Guest mile for every £1 spent on Amex Gold or Amex Platinum.

These cards come with excellent sign-up bonuses.  Amex Gold comes with 20,000 points for signing up, whilst Amex Platinum comes with 30,000 points.  Amex Gold is free for the first year.

In the short term, taking out a ‘free for a year’ American Express Preferred Rewards Gold, banking 20,000 Etihad Guest miles from converting the sign-up bonus and earning 1 mile per £1 spent – with no fee for 12 months – is probably your best deal.

Best American Airlines UK credit card replacement

Scenario 2:  You specifically want a Visa or Mastercard to collect Etihad Guest miles

If – and it is a big ‘if’ – you qualify for HSBC Premier then you have a very easy solution staring you in the face.

The HSBC Premier Mastercard is free.  You earn 1 point per £1 spent which converts into 0.5 Etihad Guest miles.

The HSBC Premier World Elite Mastercard has a £195 annual fee.  There is a sign-up bonus of 40,000 points (20,000 miles) with a further 40,000 points (20,000 miles) at your card anniversary if you have spent £12,000.  You earn 2 points per £1 spent which converts into 1 Etihad Guest mile.

The snag is the eligibility criteria for HSBC Premier.  You must pay in your salary and have either savings or investments of at least £50,000 with HSBC, or an individual annual income of at least £75,000 and a HSBC mortgage, investment, life insurance or protection product.

For everyone else, earning Etihad Guest miles from a Mastercard or Visa now is trickier and less lucrative.  You can’t get anywhere near the 0.75 miles per £1 that the MBNA card offered.

The only slightly decent Visa / Mastercard option is via the IHG Rewards Club Mastercard (0.2 miles per £1, assuming you convert 10,000 IHG points into 2,000 airline miles) or, with the £99 IHG Rewards Club Premium Mastercard, 0.4 miles per £1.

There is a sign-up bonus on these cards.  The free IHG Mastercard comes with 10,000 IHG points, worth 2,000 Etihad Guest miles.  The £99 Premium card comes with 20,000 IHG points, worth 4,000 Etihad miles.

Best American Airlines UK credit card replacement

Scenario 3:  You want a high-earning Visa or Mastercard and are willing to move away from Etihad Guest

Without a doubt, the two Virgin Atlantic Mastercards are the most generous Visa or Mastercard products available – either the Virgin Reward Mastercard (free, 5000 miles bonus) or Virgin Reward+ Mastercard (£160, 15000 miles bonus).

You get 0.75 miles per £1 on the free card and 1.5 miles per £1 on the paid card.  This is FAR better than any Avios or hotel card.  The free Virgin Atlantic card equals, at 0.75 miles per £1, what you were getting for non-Amex spend from your old Etihad Guest credit card.  You also get a 2-4-1 or upgrade redemption voucher for hitting spending targets.  The only downside is that, with no short haul routes, you are unlikely to earn enough miles purely from the credit card to get a good redemption so the cards are best suited to regular Virgin flyers.

The best long-term cards for an Avios / Asia Miles / Singapore Krisflyer collector (if you have a high income) are the HSBC Premier Mastercard or HSBC Premier World Elite Mastercard Whilst Etihad Guest is a partner, as we discussed above, the three other transfer options would also allow you to focus your card spend elsewhere.

If you simply want a free Visa or Mastercard and collect Avios, the best option is the Tesco Clubcard Mastercard.  You get 1 Clubcard point per £8 spent which translates into 0.3 Avios per £1.  However Tesco rounds down each transaction to the nearest £8 which means your actual earning rate is lower.  You get extra value because Clubcard points have many uses – as well as Avios, you could send them to Virgin Flying Club or a totally different Clubcard partner altogether, such as Uber or hotels.com.

Reviews and to apply

Here are my reviews of the cards mentioned above, which also explain the sign-up bonuses available:

Starwood Preferred Guest American Express – review, apply 

American Express Preferred Rewards Gold – review, apply 

American Express Platinum – review, apply 

HSBC Premier Mastercard – review, apply 

HSBC Premier World Elite Mastercard – review, apply 

IHG Rewards Club Mastercard – review, apply 

IHG Rewards Club Premium Mastercard – review, apply 

Virgin Atlantic Reward Mastercard – review, apply 

Virgin Atlantic Reward+ Mastercard – review, apply 

Tesco Clubcard Mastercard – review, apply 

Please read this important interest rate information:

Starwood Preferred Guest American Express – representative APR 39.7% variable including fee based on a notional £1200 credit limit

American Express Preferred Rewards Gold – representative APR 57.6% variable including the annual fee (free in year 1) based on a notional £1,200 credit limit, interest rate on purchases 22.9% APR variable.

HSBC Premier Mastercard – representative APR 18.9% variable

HSBC Premier World Elite Mastercard – representative APR 59.3% variable including fee based on a notional £1200 credit limit

IHG Rewards Club Mastercard – representative APR 18.9% variable

IHG Rewards Club Premium Mastercard – representative APR 41.5% variable including fee based on a notional £1200 credit limit

Virgin Atlantic Reward Mastercard – representative APR 22.9% on purchases

Virgin Atlantic Reward+ Mastercard – representative APR of 63.9% including the fee, assuming a £1200 credit limit

Tesco Clubcard Mastercard – representative APR 18.9% variable

(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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  1. James A says:

    The glory days of card points seems to be well and truly over. Going to be a lot harder to accrue a non flying miles balance going forward.

    • unless u move to the USA or ‘move’ to the USA using amex global transfer (of course, you need to fulfil the criteria).

      • guesswho2000 says:

        How can you ‘move’ to the USA? Surely global transfer will need an address? Feel free to enlighten me, but I’ve used global transfer and their checks are thorough!

  2. Wonder how long it will be before HSBC enhance their card/earnings rates/bonus?

    H4P can start drafting the “If you have the HSBC Premier Mastercard card, should you be asking for a fee refund?” article now, I guess.

    • I think HSBC has different economics because they want you as a Premier customer to flog you other tat which is very profitable 🙂

      • How very close to the phrase **this time it’s different**. You worked in the City before, didn’t you? 😉

        It’s the same sort of reasoning that 3V might have used, in that case “a big % of everyone’s gift cards never get redeemed, it’s a dead cert we’ll make $lots by selling these fee-free visa debit gift cards”… and we know how that ended.

        The business model works just fine until the point when it doesn’t, in thise when you start to attract too many undesirables (the miles and points crowd), who will (almost) never buy any additional profitable product, just skim the cream and immediately move onto the next opportunity.

        Hey ho, time will tell.

  3. Dominic says:

    Disappointed! Had seen that the card was going; was hoping that they might extend it until the end of the year, as I am not working again until January (and have already given up my Gold…). With little earning, going to struggle to get another decent card for 6 months.

  4. Sanya says:

    I just tried to use it and it does not work on mine (I did use it the last time the offer was on)

  5. xcalx says:

    Received letter yesterday from MBNA re the AA card changing to Visa with 0.5% cash back on all purchases, no fees for using abroad, no cash withdrawal fees home and abroad.

    • Charlie T. says:

      I also got the letter. Note that the cash back is 1p per £2 spent and is rounded down. So a £1.99 purchase earns no cash back, a £3.99 purchase earns 1p etc, rather than totting up the total spend over the month and multiplying by 0.5%.
      And no charges for foreign currency transactions but I don’t necessarily read that as no spread (traditionally about 3%) being added to the FX rate.

      • It means no spread, almost certainly.

        • Charlie T. says:

          Awesome if that’s the case!

        • Michael Jennings says:

          Are the less profitable customers being given bog standard cards and only the profitable ones getting this, or is everyone getting the good card?

          I am waiting to see what my Virgin Atlantic white card is replaced with.

        • Charlie T. says:

          Having never paid a penny in CC interest I was deemed unprofitable enough to be given a bog standard card when they closed the bmi card, and was expecting the same this time, so pleasantly surprised to get the cash back card – may mean its universal I guess.

  6. Combat Johnny says:

    Looks like my Miles & More credit card will get the chop soon

    • And that is a real issue, for me too, due to the miles expiry.

      • Fly yourself some M&M status!

        • That seems a bit inhumane!

        • My OH recently flew back from Asia on a LH A380 and said the [new-ish] J seats were fine, but the food was rubbish.

          She apparently left the aircraft through doors 1, involved walking through F, didn’t seem too impressed with the latest LH F, said there was “a complete lack of privacy”. I get the feeling she’s a bit spoiled by our EY F redemptions … 🙂

  7. Adam S says:

    OT regarding Amex Gold Companion card – How long does it take for the 5000 bonus MR to be posted normally? Hit the £500 spend around 2 weeks ago

    • Mark2 says:

      Have had the card several times and the bonus was attached to the points for the qualifying purchase.

      • Adam S says:

        So basically immediately? The 20k points posted almost immediately but this one doesn’t seem to be coming through.

        • Roger says:

          Having the same issue, been a couple of weeks now. Called last week and was told they would be posted by end of day – they werent. Called yesterday and was told they will post but may have to wait the entire 90 days.

        • ricardo says:

          In the same position here. I hit the £500 3 weeks ago, within a few days of the card arriving, but no bonus MRs have appeared yet. My first statement is due imminently so I am waiting for that before querying it with CS..

        • Adam S says:

          In fairness they say it’ll take up to 30 days, my first statement has already come through at £500.80 but no mention about the bonus points, will wait until the 30 days are up and then call, but doesn’t seem like that will help as according to @Roger. There wasn’t a track bar either so thought maybe it didn’t record properly

        • Roger says:

          Nope no track bar for me either. Have used the chat facility within my account but they havent been helpful

    • Adam S says:

      Pretty sure the adviser at the other end of the phone could manually add them if they wanted, not sure what waiting 90 days will do..

  8. This is a temporary and targeted offer which we have been asked not to promote as it will cause trouble with everyone not targeted 🙂

  9. It is another extension, I have a diary note to cover before it ends again.

  10. FYI don’t cut up your card if heading for Sydney, it gets you 2 free drinks at The Lounge bar in the Opera House. There now to see Neil Finn ( Crowded House)

    • FormalHall says:

      I will be at the Sydney Opera House next week; how does the free drinks deal work? Which cards qualify?

    • Not a bad night out, I’m a bit jealous.

      • Rob it was brilliant, I only booked a few hours ago and could only get restricted view seats but 66 dollars for the 2 of us was a bargain. Part of Vivid Live.

  11. Will the MBNA Emirates Skywards will be axed too? If so, when?
    Eeeek.. it is currently the main CC since I am waiting 6m for Amex again.

    • Given that Etihad and AA are closing 27th July there is probably a decent chance you get a letter next week with the same date. Not certain though.

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