Balance transfer credit cards with rewards programs

Discover how to repay your debt interest-free, while earning rewards

Balance transfers and rewards card are both attractive features, but imagine if you could take advantage of them both with one card. Enjoy the benefit of a lower interest rate to consolidate your debt and once you pay it off, earn points on purchases to reward your spending. While these cards sound like a prime catch, there are some factors to consider before submitting your application.

What are the features of a balance transfer credit card with rewards?

Balance transfer credit cards with rewards offer a number of features, and while these may vary from card to card, the following should give you a fair idea of what to expect:

  • Balance transfer offer. Some cards charge 0% p.a. on balance transfers during the promotional period, while others charge low balance transfer rates. The period of these offers typically varies between 6 and 12 months.
  • Earning reward points. The earn rate (how many points you collect per dollar) will depend on the provider and rewards program. There may also be terms and conditions such as bonus points with partnered retailers or restrictions on transactions (such as cash advances). It also pays to find out if your points expire, and if there’s a cap on the maximum number of points you can earn.
  • Redeeming rewards. Understand exactly how to redeem your points. Specific rewards programs give you the option to choose between an array of merchandise, store vouchers, and travel vouchers; some allow you to use your points as cashback, and others give you the option to transfer your points to your Airpoints program account. You want to make sure the rewards suit your lifestyle so you can get the most from your card.

What are the pros and cons of using a balance transfer credit card with rewards?


  • Save money. By paying little to no interest on balance transfers for a given time, you can save considerably in the form of interest, especially if you manage to pay off the entire transferred balance before the promotional period comes to a close.
  • Earn rewards. If you use your credit card frequently, you can benefit by earning more rewards.
  • Make use of extras. Some of these credit cards come with complimentary purchase and travel insurance cover that you can use in different circumstances. Some cards also offer round-the-clock access to a concierge service that will assist with various matters.


  • High-interest rate. You can expect a balance transfer card with rewards to charge a high-interest rate on purchases. If you don’t keep paying your account’s closing balance in full each month, the money you spend in interest could outweigh the rewards you earn.
  • Annual fee. These credit cards usually charge ongoing annual fees, and just how much you have to pay in annual fees varies according to the extras a card offers.

What else will I need to consider when comparing this type of card?

When comparing rewards credit cards with balance transfer offers, don’t forget the following:

  • Balance transfers don’t earn rewards. At the time of writing, no New Zealand credit cards offer rewards points on the balance transfer.
  • The earn rate. The earn rate can vary from one rewards card to the next, so pay due attention to this aspect. Typically, platinum and premium cards offer better earn rates, and American Express usually compares better than Visa and Mastercard on this front.
  • The revert rate. At the end of the promotional period, any outstanding balance from the balance transfer starts to attract the card’s purchase rate or cash advance rate. In New Zealand, it is usually the purchase rate.

Getting a balance transfer credit card with rewards can be a good idea if you have a plan in place and plan to pay off the entire transferred balance within the promotional period. Once you do, you can then look forward to earning rewards. There are a number of options available, so make sure you compare them before applying for one.

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