Managing your money

Get rewarded for using your credit card

4 min read


Credit cards with rewards schemes can make a for an enticing bonus when you’re trying to decide on a new card. Knowing which one is going to be the best fit for you can take a bit of figuring out. Here’s how credit card rewards work and how you can get the most out of them.

Why do banks offer rewards?

Put simply, rewards are a type of loyalty scheme. Banks use them to attract new customers and, as the word loyalty implies, to keep existing customers happy. The rewards are usually geared to encourage you to use your card, meaning the more you spend, the greater the rewards. However, just as it is with credit cards in general, if you’re to get the most out of the rewards on offer, you need to play things smart.

What kinds of rewards can I get?

Generally speaking there are two of the key categories: cash back or merchandise rewards.

Cash back is just that, for every dollar you spend on your credit card, you’ll get a portion of it back. The exact amount you earn varies from bank to bank so shop around and find the one that suits you best. Merchandise can be almost anything, from gift cards to flights to shopping, a popular rewards scheme that centres around merchandise is FlyBuys.

Tip: BNZ credit card users who’ve chosen FlyBuys can earn two lots of points when using their card at a FlyBuys retailer. They’ll get points for purchasing on the credit card and then again for swiping their FlyBuys card.

How do I earn rewards?

Most credit card rewards will have a set earning rate that makes it easy to figure out exactly how much you’ll be able to earn as you spend. For cash rewards, some cards will offer, say, $1 cashback for every $150 spent, while others may offer a better ratio, say $1 cashback for every $75 spent. Usually the cards with higher annual fees offer a better reward ratio as part of an overall package of more exclusive benefits.

Merchandise rewards work the same way, except you’ll earn points (rather than dollars) that can then be redeemed for specific items through an online storefront like Flybuys.*1
One of the easiest ways to quickly accumulate points is to use your credit card to pay for monthly bills like power, phone and internet.

Tip: Ensure you spend on your credit card wisely, if you can’t pay off your card in full each month you’ll be paying interest that may cancel out the benefits of the rewards scheme. Check out this guide on how not to use your credit card.

Does all my spending earn rewards?

While all your usual purchases will earn you rewards point or dollars, most credit cards will exclude things like cash advances, balance transfer amounts, interest charges and bank fees. In addition, certain types of spending won’t earn you rewards, this includes gambling, betting and lottery transactions.

Tip: Check the fine print on your credit card contract for a more comprehensive list that’s specific to your card.

How do I spend my rewards?

This is the fun part, spending your hard earned rewards. For cash backs, there are a handful of options. You can get your cash put straight into your bank account, or, if you feel like taking a more sensible route, you can have it credited back to your credit card or, for BNZ KiwiSaver Scheme members, directly to your BNZ KiwiSaver Scheme account.*2

If you chose the merchandise option over cashbacks, your bank will likely have a specific website that lets you browse for things to buy. If you’re familiar with redeeming FlyBuys points through the FlyBuys website, you’ll have a good idea of how this works across other rewards schemes.

Tip: Keep an eye out for specials. Sometimes retailers may offer bonus rewards points for short periods of time. Take advantage of these where possible to help grow your rewards.

Which is best for me?

Finding the credit card and rewards scheme that suits you best is a matter of comparing the various offerings and picking the one that fits your spending habits. Try and match the rewards with how you would normally shop to maximise the returns. As for deciding between cash back or merchandise, cash back is always useful, but merchandise may come in handy if you have specific gifts in mind that you might not otherwise buy. Only you will know the best option for you.

Tip: Saving up rewards points during the year can be a handy way of relieving some of the gift buying burden at Christmas time.


Spread your wings further with extra cash back

Apply by 30 November and be approved for a BNZ Advantage Visa credit card, and you could be eligible to get $150 bonus cash back or 1000 FlyBuys points with a BNZ Advantage Visa Platinum card or 500 FlyBuys points or $75 cash back with a BNZ Advantage Visa Classic card.*3

Learn more about the BNZ Advantage Platinum and Classic Credit Cards

1. Fly Buys terms and conditions apply. Fly Buys collection and redemption rates are subject to change without notice. For further details visit flybuys.co.nz. BNZ (and its related companies) do not guarantee the collection or redemption of Fly Buys points or that Fly Buys points will continue to be offered for products or services provided by them.

2. BNZ Investment Services Limited, a wholly owned subsidiary of Bank of New Zealand (‘BNZ’), is the issuer and manager of the BNZ KiwiSaver Scheme. A copy of the BNZ KiwiSaver Scheme product disclosure statement is available on bnz.co.nz. Investments made in the BNZ KiwiSaver Scheme do not represent deposits or other liabilities of BNZ or any other member of the National Australia Bank Limited group, and are subject to investment risk, including possible delays in repayment and loss of income and principal invested. None of BNZ or any other member of the National Australia Bank Limited group, the Supervisor, and any other director of any of them, the Crown or any other person guarantees (either fully or in part) the performance or returns of BNZ KiwiSaver Scheme or the repayment of capital.

3. Lending criteria, terms and fees apply. To be eligible, along with the above, your card account must remain open, you must not switch to another credit card and you must comply with your card’s terms and conditions throughout the term of the offer. Full offer terms and conditions apply and are available here.