Credit card rewards aren't all they are cracked up to be

It seems that every credit card provider worth their salt has some sort of reward scheme in place in order to lure in a greater number of Aussies.

People down under are certainly not shy when it comes to using plastic – which was highlighted by recent government figures that showed the nation has racked up $36 billion in credit card debt.

However, a new report released by the Reserve Bank of Australia has suggested that many reward schemes are not entirely worthwhile.

A lot of lenders now issue cards that carry higher rates of interest but promise the customer that they will receive loyalty points for every dollar that they spend on their plastic. These points can then be accumulated and, in theory, should lead to significant discounts on future purchases.

Unfortunately, the RBA research indicated that Aussies need to spend thousands of dollars on their card before they are even eligible to receive $100 in vouchers. So, if you are attracted to a credit card package that offers such a reward scheme, do your research before making a commitment.

Have a question about credit cards? Ask the money gurus at Mozo Answers.ADNFCR-1761-ID-801319414-ADNFCR