Spend while getting a bonus. That’s one of the tempting offers stirred up by credit card issuers to lure new customers.
Studies have shown that cardholders want to be rewarded for their transactions. The challenge for most is deciding which card will bring the best rewards for their personal spending habits.
Unlike using cash or a debit card, which have no perks, the cash-back credit card enables you to get back a part of what you spend on the card.
“This plan gives you immediate cash credit on a monthly basis with no fuss,” says Kris Werner, HSBC Philippines head of retail banking and wealth management.
Dining-purposed program
The HSBC Gold Visa Cash Back Credit Card highlights a dining-purposed program that caters to the Filipino market. The cardholder gets a 5 percent rebate or cash-back on dining transactions.
“Dining with friends and family is important to Filipino culture,” he says.
Then there are generous introductory bonuses. The cardholder, for instance, gets P2,500 off on the first dining transaction from the HSBC Gold Visa. “It’s a sweetener—our gift to our customer,” says Werner.
Customers who drive get 10 percent rebate on the first Caltex fuel purchase, followed by 3-percent rebate after every transaction.
Explaining how the cardholder earns when one spends, Werner says, “If I paid with the Gold Visa today, I get a 5 percent cash-back spend in a restaurant. We track the composition of the spend and calculate the cash-back amount. If we go to Caltex and fill up the petrol tank, we get 3 percent rebate.”
The HSBC Gold Visa offers a cash-back cap or maximum rebate of P1,200 a month which is the highest in the industry.
As in most credit cards, there are hidden perks, such as the Home and Away Program. Cardholders can benefit from any of the 27,000 merchants where HSBC has special deals: car rentals, resorts and a range of companies.
The seasonal offers are also based on customers’ feedback. The annual fee of P5,000 can be waived for customers who use the card very frequently.
HSBC is making the card more accessible to the market. The Cash Back Gold Visa caters to professionals with a monthly salary of at least P20,000.
“These are mostly millennials who love to dine, travel and shop. They are pro-electronic. They use Grab, put their card on the phone and travel with the Gold card,” says Werner.
The approval of the application is subject to credit requirements. The bank examines how applicants and cardholders have managed their credit product in the past. Responsible cardholders pay the balance in full and promptly to avoid interest charges.
Card protection
He clarifies that the cash-back card is not to be misconstrued as an enticement to splurge.
“We don’t drive customers to spend excessive amounts. The correct amount is what the customer feels comfortable spending. We’d like to support the continued digitization of the market here and the migration away from cash into electronic payment mechanisms. It’s easier and safer.”
The credit cards are protected by a sophisticated real-time fraud monitoring system. Cardholders get an SMS alert on a transaction worth over P5,000. Visa also provides rules for protection.
Instead of the magnetic stripe that can be hacked, the HSBC cards come with the EMV (Europay, Mastercard and Visa) chip that prevents data breaches from happening, and guards customers against fraud.
Asked why one should get a card in the first place, Werner cites his own lifestyle; he says 95 percent of his spending is based on card transactions. It helps him monitor his expenses more easily than cash and also track his transaction history.
“It’s safer. I have the habit of losing cash. It drops and I don’t know where it went. I want to make sure I can control my spending and have my account balance sitting on the bank, earning interest as well. I use the debit card for small transactions, and use the credit card for larger transactions.”
His advice to prospective cardholders is to get a card that answers their needs. Frequent travels benefit from a travel savings card. The Red Mastercard caters to lifestyle and fashion, while the cash-back credit card is ideal for day-to-day spending. —CONTRIBUTED