ARCHIVED ARTICLE This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Image of Leanne Macardle

Leanne Macardle

Freelance Contributor
Published: 21/11/2017
blue and black lines

News contents

The cost of Christmas is officially on the rise; with inflation at a five-year high of 3% and food and energy prices rising, running the boiler and buying those all-important Christmas groceries will already be costing more. With less than five weeks left to go until the big day, consumers are likely to be concerned about how much the festive season will dent their bank balance, and they may not even be able to rely on decent credit card deals to cover the cost.

Credit card cutbacks

Unfortunately, our latest figures show that interest-free deals on credit cards have been shrinking over the past six months, giving consumers fewer months to spread the cost of Christmas. And that's not all – at the same time, the cost of withdrawing cash using a credit card is on the rise, and cashback cards are becoming far less rewarding, with fewer deals and less competitive cashback terms.

The table below highlights the changes in more detail. As you can see, while the average rate for withdrawing cash has increased over the last year, cashback and 0% interest deals have both declined, with the average term now being notably lower than six months ago.

Nov-12 Nov-16 May-17 Today
Average Cash PA % 26.3 26.5 27.1 27.2
Cashback cards 20 23 15 13
Number of 0% intro purchase cards 101 99 102 93
Average 0% intro purchase deal term (days) 185 287 381 349

"The pressure on families over Christmas is only set to grow, what with the cost of energy and food rising, not to mention the recent rise in interest rates," said Rachel Springall, finance expert at "All of this combined will make it increasingly more difficult for households to stretch their budgets to cover the festive season. Those who are just about managing should also avoid taking out cash on their credit card due to the cost of fees and interest.

"There are still some ways for shoppers to make the most of any spending, such as by earning some cashback with a credit card, or even by making use of an interest-free purchase card to spread the cost of Christmas, but the offers are not as rewarding as they once were."

Some may think of utilising the cashback offers that are now part and parcel of many current accounts, but even these are being cut, as Rachel continues:

"Cashback is tightening on both credit cards and current accounts, with NatWest previously paying up to 3% cashback on utility bills through its Reward current account, which is now down to 2%. Similarly, Halifax once offered a £125 switching incentive for its Reward Account as well as £5 a month, now down to £75 and £3 respectively.

"However, consumers can still get £185 in gift cards from M&S Bank if they switch to their current account and stay for 12 months. There's also still American Express, which offers an Everyday Cashback Card paying 5% cashback for the first three months, plus a 'shop small' incentive for two weeks in December whereby shoppers can earn £5 when they spend £10 or more. Alternatively, customers who shop online could buy gifts through websites such as TopCashback to earn a little extra each time they shop.

"While the rewards continue to slim down and consumers' bank balances shrink, it's important for shoppers to start counting down the cost of Christmas, attempt to rein in their spending and seek advice if they are struggling to cope."

Get the best deals

Rewards may be shrinking, but that makes it even more important to make sure you're getting the best deals possible. The table below outlines some of these deals, which could help you make the most of rewarding credit cards and current accounts throughout the festive season.

Selection of the best cashback deals

Credit card / current account Cashback, switch and spend Based on a £500 eligible spend / loyalty Total money earned minus any fees in first month
Halifax - Reward Account Switch = £75. Spend = up to 15%. Credit = £3 15% = £75 No fee = £153
Barclays - Bank Account with Blue Rewards Up to 10% cashback (selected partners). Credit = £7 pm. Extra £5 for mortgage holders, £1* for insurance and £1 for loan Up to 10% at selected retailers = £50. Credit = £7 £7 earned minus £3 fee = £4. £54 for current account holders only - cashback and reward. Holders of a Barclays mortgage, insurance and loan can earn £61
American Express - Platinum Cashback Everyday Card 5% for 3 months, then 0.50% tiered - 1.00% depends on spend 5% = £25 No fee = £25
TSB - Classic Plus Credit = £5 pm when holding two direct debits, £5 more with 20 debit card transactions Spend = £5 pm (if 20 debit card transactions made) No fee = £10
Santander - 123 Lite 1%, 2% or 3% cashback depending on the category of the bill Assumed council tax £200, water £35, gas and electricity £100, Santander home insurance £15, phone, mobile, broadband and TV £150 £9.15 earned minus £1 fee = £8.15
NatWest - Reward Current Account 2% back on utility direct debits 2% = £10 (1% can be earned from purchases with selected retailers) £10 earned minus £2 fee = £8 (or £3 from selected purchases)
The Co-operative Bank - Current Account Credit = £4. Spend = up to £1.50 pm £1.50 pm max (5p every time debit card used) + £4 credit No fee = £5.50
*Additional rewards are available to customers who take out buildings and contents insurance, Finer home insurance, Non-Advised Life insurance and Mortgage protection. Double cash reward is available on selected products for new customers during November.



Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time. Links to third parties on this page are paid for by the third party. You can find out more about the individual products by visiting their site. will receive a small payment if you use their services after you click through to their site. All information is subject to change without notice. Please check all terms before making any decisions. This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

blue and black lines

News contents will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by will always be from Be ScamSmart. will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by will always be from Be ScamSmart.