BT credit card to cut phone costs

BT’s new credit card which rewards customers by reducing their phone bills is likely to be popular, according to the SimplySwitch.com comparison website.

Customers of the telephone provider will see their phone bill cut by 1p for every £2 they make in credit card purchases up to £250.

Once they pay more than £250 a month, their reward doubles and 1p will come off their bill for every £1 of credit card purchases.

The new BT Credit Card offers zero per cent balance transfer for 12 months, which is subject to a three per cent fee. However, since the card is run by MBNA, customers with other MBNA cards will not benefit from the balance transfer offer.

It also offers zero per cent on purchases for three months before reverting to 16.9 per cent APR.

Karen Darby, founder of SwimplySwitch.com said: "This is an innovative move by BT and takes the ‘bundling’ of services to a whole new level. It is quite rare to find any reward scheme operating on a card with zero per cent balance transfers."

However, failing to clear the bill will negate the effect of the phone bill savings as for every £2 they have not paid off they will be repaying just under 3p.

While there is a potential for saving up to £75 a year, customers spending £250 a month will only save £1.25 on their bill.