HSBC Premier MasterCard UK – Not the Best on the Market But Why?
I’ve toyed with the idea of writing a review of the HSBC Premier credit card for some time now. The likelihood is that few regular readers will meet the tough qualification criteria and even if they did the benefits of the HSBC Premier MasterCard UK are limited in comparison to other free cards on the market. That said, as Benjamin Franklin once quoted “an investment in knowledge pays the best interest” so hopefully the information contained within this HSBC Premier MasterCard review will help equip you with the knowledge to decide which credit card would be best suited to your spending habits.
HSBC offers two Premier credit cards. The HSBC Premier MasterCard is the free version, alongside the premium version, HSBC Premier World Elite MasterCard, which comes with an annual fee of £195.
To qualify for the HSBC Premier card you’ll need to pay your annual income into a HSBC Premier bank account and meet one of the two following qualifying factors:
- Have over £50,000 of investments or savings with HSBC in the UK;
- An income of over £75,000 and one of the following HSBC products – mortgage, investment, life insurance or protection product.
In comparison to the likes of American Express this is restrictive and is likely to rule out a large number of people. On a more positive note, the definition of investment is relatively unclear in the terms and conditions and I’ve heard of people with Stocks and Shares ISAs being able to sign up. On the basis you could set up a Stocks and Shares ISA with as little as £50 per month, this may be a possible option.
Let's break this post down...
HSBC Premier Card – Sign-Up Bonus
Until recently HSBC have been running a promotion for a free night’s stay at a luxury UK hotel. Unfortunately this has since ended and there is currently no sign-up bonus for the HSBC Premier credit card.
Any Other HSBC Premier Benefits?
The HSBC Premier credit card offers the following main benefits:
- An earnings rate of 1 point for every £1 spent on the card
- Airport lounge access at £20 a visit
- Free unlimited Wi-Fi
Since the recent loss of numerous MBNA MasterCards (covered in detail on this website) the number of MasterCard products with high, continued earnings rates has dropped dramatically. For frequent-flyer rewards, this leaves only the two HSBC Premier credit cards and two new Virgin Atlantic credit cards offering reasonable earnings rates. The free HSBC Premier card offers 1 point for every £1 spent. These points can be transferred to 4 airline loyalty programmes (Avios/Asia Mile/Singapore Airlines/Etihad Guest) at a rate of 2 points to 1 frequent-flyer mile. As such you’ll be earning 0.5 frequent-flyer miles for every £1 spent. Although somewhat difficult to compare, this is less than the free Virgin Atlantic Reward credit card (reviewed here) which offers 0.75 Flyer Club Miles for every £1 spent. I’ll cover the value of a HSBC Premier Rewards point a little later in this article.
Holders of the HSBC Premier MasterCard UK credit card will have access to over 750 lounges through LoungeKey. Each visit will cost £20 which is similar to the rate offered by Lounge Club and is issued with the American Express Gold card (reviewed here) although the Gold card also offers 2 complimentary visits.
Finally, free Wi-Fi is offered by the provider Boingo. I hadn’t actually appreciated that this was a benefit offered to all MasterCard holders – worth exploring if you live in a city centre close to a hotspot (although I suspect it’s likely to be quite slow).
What is a HSBC Premier Rewards Point Worth?
As mentioned, you’ll earn 1 point for every pound spent on the HSBC Premier credit card. How can you use these points and what are they worth?
Donate to Charity – you can donate your reward points to charity with 1,500 worth £5 (0.3p per point).
Vouchers – You’re able to redeem the HSBC Premier Reward points for retail vouchers. A similar rate of 1,500 points equalling £5 is available if you are to redeem for vouchers.
Laithwaite’s Wine – As can be seen from the redemption table below, based on RRP provided, redeeming points for Laithwaite’s Wine would be worth anywhere between 0.4p and 0.5p per point spent. Whilst this appears the best option, I suspect the actual price of the wines may be less than quoted.
Redeeming for Frequent-Flyer Air Miles – The final option would be to redeem the points earned from the HSBC Premier MasterCard credit card with any of the four partner airlines – British Airways, Etihad, Asia Miles and Singapore Airlines. On Thrifty Points we tend to focus on British Airways Avios points and would value these at anywhere between 0.5p and 1.5p per point depending on the individual’s spending habits. You can see how we arrive at our opinion of value for Avios here. With a rate of 2 HSBC points for every 1 frequent-flyer mile, this option is likely to equate to roughly 0.25p – 0.5p per point.
HSBC Premier Rewards – How does the Free Card Compare with the Premium Version?
The premium version of the card comes with a heady annual fee of £195 and the following additional benefits:
- Sign-Up bonus of 40,000 HSBC points when you spend £2,000 within the first 3 months. Equating to 20,000 Avios points, this could be worth as much as £200 and would offset the annual fee.
- Further bonus of 40,000 HSBC points when you spend £12,000 in the first year. Again equivalent to 20,000 Avios points.
- Unlimited LoungeKey access. This could be a significant benefit if you travel regularly and don’t benefit from airline status which allows you to gain entry to lounges. Unfortunately you cannot take a guest into the lounge, however you could get a supplementary card for £60 per annum which would then grant access.
- There are various other benefits that come with the MasterCard UK World Elite programme – full details can be found here.
- An increased earnings rate of 2 points for every £1 spent on the card. As such you’d get 1 frequent-flyer club mile for every pound spent.
If you’re likely to spend £12,000 on the card in a calendar year, you’d be able to earn as much as 52,000 Avios points. This is an exceptional earning rate for a MasterCard. If you were then to combine this with a British Airways Premium Plus card which offers a sign-up bonus of 25,000 Avios points (26,000 Avios points if you use this link) and most importantly a 2-4-1 voucher at £10,000 of spending (also earning you 15,000 Avios points for spending £10k on the card) you’d effectively be able to earn 93,000 Avios in a calendar year. Combine this with the 2-4-1 voucher to increase your redemption capability to 186,000 Avios – enough for 2 First-Class transatlantic flights! Read my recent BA First Class review for a step-by-step guide.
What Could You Do About the 3% FX Fee?
Like most credit cards, the HSBC Premier card comes with a 3% foreign exchange fee if used for spending abroad. You could however reduce this fee by connecting the HSBC Premier card to the Curve card – reviewed in full here. By loading all your credit and debit cards to the Curve app you’re able to use the Curve card and charge payments back to any of the linked cards (in this case the HSBC Premier credit card). The Curve card has 0% FX fees and as such is a great option if you’re travelling and would still like to earn points.
What UK Cards Offer Better Perks?
Alternative Free Cards
With a sign-up bonus of 20,000 reward points (equivalent to 20,000 Avios) and an ongoing earning rate of 1 point for every pound spent, the (free for the first year) American Express Gold card (reviewed in full here) is currently one of the most generous credit cards on the market. You’ll also receive 2 complimentary lounge passes and international travel insurance. From the end of the first year the card has an annual fee of £140 pa. At this point we’d recommend most people cancel. There’s then nothing stopping you signing up again after 6 months and receiving the sign-up bonus again. You can increase the sign-up bonus to 22,000 reward points by using this link.
Alternative Premium Cards
With an annual fee of £450 the American Express Platinum card is currently one of the most expensive cards in the UK market. That said if you travel a significant amount the benefits are likely to outweigh the annual cost (I have both the Gold and Platinum cards). Read my review here for the full benefits offered and some detailed cost analysis to see whether it would be worth it for your spending/travel habits. The card comes with a sign-up bonus of 30,000 reward points which can be increased to 35,000 reward points if you use this link.
Let’s Wrap it Up – HSBC Premier UK Review
The tough sign-up criteria and stronger earnings rates of alternative credit cards means the HSBC Premier card would be of limited appeal to most. That said if you’d struggle to use an American Express credit card at a large percentage of the retailers you visit, the HSBC Premier credit card may be of interest to some, with one of the best earnings rate for a free MasterCard.
Should you wish to use the HSBC Premier MasterCard card abroad you can significantly reduce the foreign exchange fees by linking the card up with the Curve app. If you’re looking for a free card with an exceptional sign-up bonus and strong continued earnings rate then we’d recommend the American Express Gold card (reviewed here). Don’t forget that you can increase the sign-up bonus received from 20,000 points to 22,000 if you use this link.