What is the best credit card in the UK for cashback? 2025 Best UK Cashback & Reward Credit Cards

• August 14, 2025

Everyday Spending Turned Into £200 Cash

The magic of cashback is earning while buying the things you already need. ONS data shows the average UK household puts around £1,800 a month on cards. Switch that spending to a card paying 1% flat cashback and you could pocket £216 a year – enough for two week's groceries or a winter energy bill boost.

The numbers climb even faster with the best cashback and reward credit cards 2025. Many launch with headline rates of 5% for the first three months (often capped at £100–£125), followed by ongoing rates near 0.75‑1%. Pick a fee‑free option, set up a direct debit to clear the balance, and that introductory burst plus regular earnings can comfortably top £200.

Pay off in full each month to stop interest eating your rewards.
Channel regular costs like council tax, fuel and streaming services through the card.
Run a quick eligibility check before applying to protect your credit score.

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Near‑Prime Credit Defined

Some people have a credit score that is good but not perfect. Lenders call this “near‑prime”. Experian places it roughly between 569 and 699, while Equifax labels it as scores of 531‑665. Around 13 million UK adults fall into this middle band, earning just under the national average of £35,000 and often using credit to smooth day‑to‑day spending. They may have one or two late payments, a short credit history, or a high credit‑utilisation rate.

Because risk is moderate rather than low, banks may charge slightly higher APRs or offer smaller limits. Specialist near‑prime credit cards focus on fair fees, straightforward rewards and credit‑building tools. Use an eligibility checker before you apply to protect your score.

How Cashback and Reward Schemes Operate

Each time you tap your card, the retailer pays an interchange fee – capped at 0.3% for credit transactions in the UK. Issuers share part of that fee with you, turning everyday spending into cash or points.

The cycle is simple:

Spend – £1 spent is £1 that can earn.
Earn – Core rates sit between 0.25% and 1%. The best cashback and reward credit cards 2025 add launch bonuses of up to 5% on the first £2,500.
Track – Totals appear on statements or in apps such as the 118 118 Money Credit Card dashboard.
Pay‑out – Providers pay cashback monthly; points become vouchers or miles once you hit a set level.
Redeem – Apply the credit to your balance or swap points for groceries, fuel or travel.

Clear the full balance every month; interest rates around 24%–36% APR can wipe out rewards faster than they build.

Top All‑Round Cashback Cards

All‑round cashback cards give you the same rate on almost every purchase, so they are perfect if you want a single card for groceries, the petrol pump and streaming subscriptions alike. In 2025, three offers rise to the top thanks to solid headline rates and user‑friendly rules:

Flat‑Rate Performer: 5% introductory cashback for the first three months (up to £125), then a simple 1% on everything. No annual fee in year one, £25 thereafter.
Tiered Everyday Earner: 0.75% on annual spend up to £10,000, jumping to 1.25% above that. Great for bigger households; spend £12,000 and you could pocket £115.
High‑Boost Capped Card: 2% on all spend for the first 12 months, capped at £15 a month, before settling at 1%. Even with the £36 fee, a typical £800 monthly spend still nets around £96 in year one.

When you compare, work out your net return. For example, an £8,000 annual spend on a 1% card with a £25 fee means £55 clear cashback (£80 earned minus the fee).

Remember: interest charges of 25% APR or more will wipe out rewards fast, so set up a Direct Debit to clear the balance every month. Unsure if you qualify? Check in under two minutes with the free 118 118 Money eligibility checker – there's no impact on your credit score.

Supermarket Loyalty Champions

Your weekly food shop is one of the easiest places to earn effortless cashback. The average UK household spends around £84 a week on groceries. Pair that with a cashback card paying 1% on supermarket transactions and you could pocket roughly £44 a year without changing brands or habits.

The real magic happens when your card also rewards the store's own loyalty scheme. Many market‑leading cards convert each till tap into both cashback and points, effectively delivering a double discount. Independent research shows that stacking a 1% cashback rate with even a modest 0.5% loyalty return boosts total value to £65+ per year on the same £84 weekly spend.

To become a supermarket loyalty champion, look for:

No annual fee – keeps every penny of cashback in your pocket.
Clear earning tiers – flat rates help you predict rewards.
Generous introductory boosts – but only if you can clear the balance monthly.

Unsure which card fits your trolley? Use our quick eligibility checker to see your chances without harming your credit score. Pay in full, track your points, and let everyday shopping drive your journey to financial fitness.

Low‑Fee Options for Side Hustlers

Every side gig depends on tight margins, so a cashback card with little or no annual fee is a smart ally. Keeping costs down helps profits grow, especially when sales fluctuate. Many deals still charge £25–£36 a year, yet fee‑free options now pay 0.25%‑0.75% on all spend. On £500 of monthly stock, fuel and ads, a 0.5% rate puts £30 back over 12 months instead of going on fees.

Flat rate cashback: Same reward everywhere, no need to juggle tiers.
Fee waivers: Some issuers scrap the charge once you spend £3,000‑£5,000 a year.
Low overseas fees: Buying supplies abroad? Pick cards with 0% FX markup.
Smart applications: Use the free eligibility checker to protect your credit score.

Keep an eye on 2025 cashback tables; fresh offers include 1% on selected marketplaces and built‑in purchase protection.

Intro Offers Worth Timing

Time your spending, and introductory cashback can feel like an instant pay rise. Several UK cards currently pay up to 5% for the first three months, often capped at £100–£125, before dropping to a flat 0.5–1.25%. That headline figure can make a big difference—if you plan ahead.

Line up predictable costs: car insurance, season tickets, even a new laptop, during the bonus window.
Watch the cap: £2,500 of spending at 5% hits a typical £125 ceiling—after that you earn less.
Set up a Direct Debit to clear the full balance; interest at 24% would erase your gains fast.
Compare future options with our quick eligibility checker before the honeymoon ends.

Smart timing turns intro offers into real, risk‑free savings, helping you step closer to financial fitness.

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Hidden Costs to Watch

Cashback looks like free money, yet even the best credit card in the UK for cashback – including the stars of the “Best cashback and reward credit cards 2025” lists – can carry costs that erode your gains. Our credit card charges checker helps you spot them early, but keep these common pitfalls front of mind:

Annual or monthly fee: Anything from £25 to £150 a year can wipe out a 1% return fast.
Intro rates that tumble: A sparkling 5% launch offer may crash to 0.5% after just three months.
Purchase thresholds: Some cards pay cashback only after you spend £3,000 a year, restricting lighter budgets.
Foreign use: Holiday spending can feel less rewarding due to non-sterling transaction fees, but we do not charge any foreign transaction (FX) fees.
Late payment and cash‑withdrawal fees: Miss a bill and £12 penalties plus interest can negate every perk.

Credit‑Building Strategies While You Earn

A good cashback card can do double duty: reward every purchase and strengthen your credit profile. Follow these simple steps to make sure your pounds and your score work together.

Pay on time, every time. A single late payment can knock up to 80 points off a typical Experian score. Set up a Direct Debit for at least the full statement balance.
Keep utilisation low. Using less than 30% of your limit shows lenders you manage credit well. Spend enough to earn cashback, then clear it.
Check before you apply. The free eligibility checker runs a soft search, protecting your score from needless hard inquiries.
Layer products wisely. If your file is thin, pairing a cashback card with a dedicated credit‑builder card can add extra positive payment history.
Review your report. Scan for errors every few months; correcting a wrong address or balance can boost your rating in days.

Used together, these habits help you collect rewards now while building the strong score needed for future goals.

Eligibility Checks and Smart Applications

Running a quick eligibility check before you apply can protect your credit score and improve your odds of securing a market‑leading cashback card. UK Finance data shows that about 20% of credit card applications were declined in 2024, often because people applied without checking their chances first. A soft‑search tool, such as the 118 Eligibility Checker, lets you see your approval likelihood in seconds and leaves no footprint on your file.

Review your credit report and correct any errors before applying.
Keep existing card balances below 30% of their limits.
Register on the electoral roll to boost lender confidence.

Spend two minutes on these steps and apply with confidence for the best cashback and reward credit cards of 2025.

Maximising Rewards Every Month

Every pound you spend can earn twice: once in goods, again in cashback. The average UK household puts about £2,400 on cards each month (ONS). At 1% cashback that's £24 back monthly, or £288 a year – money you shouldn't leave behind.

Channel regular bills, groceries and fuel through the card to build predictable rewards.
Set a Direct Debit to repay in full; one interest charge can erase months of gains.
Check the card app weekly and grab retailer boosts worth up to 5% on selected categories.

Unsure which product fits? Use our quick eligibility checker to see your options without affecting your score. Staying organised keeps your credit file healthy and your rewards rolling in.

Frequently Asked Questions

How much cashback can I earn in 2025?

Leading cards now pay 0.5%–1% on daily spending, with up to 5% on the first £2,500. Spend £600 a month and you could still earn around £72 a year.

Is cashback taxable income?

No. HMRC views cashback and reward points as a price reduction, not earnings, so you do not report it on your tax return.

Are annual fees worth paying?

Possibly. Paying £25 a year on a card that returns 1% means you break even after £2,500 spend; anything above that is profit. Work out your projected use.

Will a credit check damage my score?

Shopping around needn't hurt. Use our eligibility checker for a soft search first; only a full application creates a hard inquiry that may trim a few points temporarily.

Final Snapshot

Cashback leaders in 2025 deliver up to 5% introductory returns (capped at £125) before settling to 0.75–1.25%. With annual fees averaging £25–£36, you typically need to spend roughly £2,500 a year to break even. Always clear your balance to avoid 23.9%+ APR wiping out rewards and run a free eligibility check via our simple card matcher before you apply.