Do you have a wallet full of loyalty cards? Many people do, especially if they shop and dine at certain popular stores often.
Every store and brand have loyalty or membership cards. But does it save you any money? Is getting a credit card enough or should you get a loyalty card as well?
What are loyalty cards and how do they work?
The idea of a membership card or rewards program is simple and straightforward—a business wants to encourage you to be a loyal customer, so they offer you rewards for spending money on them.
Each time you shop at a supermarket, pharmacy, or department store, the cashier scans your membership card, earning you points that you can redeem for rewards, such as goods or vouchers. Some membership cards give you access to store sales, while others provide you with store credits or cash rewards for spending a certain amount.
What is the purpose of a loyalty card?
The concept of membership cards and loyalty reward programs is to get you to shop at that store more often. Some privilege cards give you sale prices only available with that card. Other membership cards don't offer instant rewards. Instead, they keep points for how much you spend, and then offer coupons once you've spent a certain amount of money.
Some loyalty cards and rewards programs let you earn cash or credit that you can use for future purchases. These are the loyalty programs that save you the most money. However, make sure you know the rules as some rewards come with an expiry date or additional requirements to redeem points or rewards.
Is a privilege card worth it?
A membership card comes with enticing benefits, but do you save money? If you buy often from a supermarket or a pharmacy chain because they're the closest to you, then having a privilege card or joining their loyalty program can be worth it. If you're doing it, there's nothing to lose by getting points and rewards.
However, don't change your shopping behavior by buying something you don't need or want just to get the rewards or loyalty benefits. If there's a charge for the loyalty program, consider how often you shop there and do some research.
For instance, if a bookstore offers a loyalty program for an annual fee of PHP 500, the PHP 500 you spend each year could be earned back if you buy new books every week. But if you rarely shop there, it will not be worth the annual fee and the space in your wallet.
An alternative option: Using your credit cards
Instead of getting a loyalty card, you can maximize the credit cards you currently own. Credit cards let you earn points and allow you to use these points to claim rewards or perks, such as cash back, discounts to different partner establishments, air miles, and more. These benefits enhance the value of paying purchases with credit cards over cash or debit.
The major advantage of using credit cards is the convenience of being able to use them for any purchase especially big-ticket items. As long as you use your credit card wisely, you earn some great rewards such as “free trips,” cash back, coupons, or discounts on purchases.
The verdict: Credit card vs a Loyalty card?
While loyalty cards can offer valuable benefits like points, miles, and exclusive offers, their effectiveness in saving money depends on individual spending habits and the specific rewards offered. To maximize savings, it's important to understand the terms and conditions of your loyalty program. Compare rewards with other options and use your card strategically. By making informed decisions and taking advantage of the perks offered, loyalty cards can be a valuable tool for saving money and enhancing your overall shopping experience.
Remember, borrowing money wisely is key to financial well-being. Shop and use credit cards wisely.
If you want to learn more about the benefits of a credit card, head on to the Metrobank Credit Cards page to learn about our different offers.