What exactly is a reward credit card? Find out the basics below...


What is a Reward Credit Card?

A reward credit card is a credit card that carries a special rewards or bonus program, meaning the cardholder can receive some benefits from using the card. Aside from the reward element, this type of card is exactly like a regular credit card.

What Kinds of Rewards can I Earn?

Each reward credit card carries its own unique rewards or bonus program. The types of programs which reward credit cards are associated with usually include:

  • Air miles
  • Hotel points
  • Concierge points
  • Fuel points
  • Collect points at certain retailers / shops

You can choose which card suits you based on which program it offers. For instance, you may be someone who frequently flies for business or personal reasons. An air miles credit card could be useful, allowing you to gather points each time you make a flight purchase with the card; these can then be redeemed for a free flight or other flight-related perks later down the line.

How Do I Collect Points?

A reward credit card is very easy to use just use the card to make purchases as you would with a normal credit card. Each time you make a purchase with the card, you will gather points which are gathered for you to redeem them later for rewards or bonuses.

Some reward credit cards only gather points for you if you use the card to make purchase with certain affiliate partnerships. For instance, you may only be able to gather air miles if you make purchases with a specified airline or other flight company.

Am I Eligible for a Reward Card?

Applying for a reward credit card is just like applying for a regular credit card. You will need to pass the card issuer's criteria in order to receive the card. These requirements might include:

  • Minimum age 18 (or 21)
  • Permanent resident of New Zealand
  • A certain minimum income
  • You may need to prove a good credit rating

Every card company or bank has its own set of requirements so make sure you check what they are prior to making your application, to avoid disappointment.

What are the Risks?

As with any type of credit card or loan, there is a risk with reward credit cards that you could end up in debt as a result of careless spending. If you take a credit card, it is essential that you are fully aware of the card rules and terms.

Have you found out what happens if you fall behind on your card payments? Will you be subject to penalty fees or will you end up paying a high interest rate?

Some people get a sense that by having a reward credit card, they are getting something back in return for spending and consequently spend more than they would do normally. A reward credit card certainly has some major benefits and could provide excellent bonuses but they are still a mode of borrowing and should therefore be used responsibly.


Please note that Which Way To Pay New Zealand ( is not authorized to give personal financial advice under New Zealand's financial services regulations, including the Financial Advisers Act (Securities Commission New Zealand).

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