The Woolworths Everyday Money Credit Card won Money Magazine's Best Innovative Product award for 2009. We're guessing there wasn't a whole lot of innovation in 2009...
It's not that the Woolworths Everyday Money Credit Card is bad, just not exceptional (the
GE Money Eco MasterCard is far more innovative in our opinion). It's like every other credit card from a major retail store chain - average features, high interest rate, narrow rewards program.
Using the card, you'll earn points which can be redeemed for vouchers at Woolworths and its associated stores, including Big W, Caltex/Woolworths fuel outlets, BWS, Dan Murphy's and some Dick Smith and Tandy stores.
The program operates an auto-redemption feature. Every four months, if you have enough points (the minimum voucher value is $20 or 3,448 points), you'll receive a shopping card which can be used at Woolworths stores.
You'll earn three points per dollar spent on Woolworths Select products, two points per dollar spent on all other purchases from Woolworths and the aforementioned partner chains and one point per dollar spent elsewhere.
A $100 shopping voucher requires 17,240 points.
The problem with retail store cards is that the interest rate typically over-compensates for the rewards program. For example:
Let's assume you spend about $200 on non-Woolworths products per week and $400 on groceries (10% of which are Woolworth Select products). You'll earn about 1,040 points per week, or 4,160 points per month which has a total redemption value of around $24.
If you have an average credit card balance (around $3,000), you'll pay over $45 interest in the same month.
You'd be better off choosing a card with a lower interest rate. At 10%, you'll pay only $25 interest, plus you could earn points toward a rewards program with broader redemption options.
If you can move past the interest rate, the remaining card features are quite good. The annual fee is only $49 (waived for the first year) and you'll get 55 days interest free on purchases. There is also a balance transfer offer of 5.99% for six months and the card is available in your choice of four colours (black, pink, blue and green).
Currently, Woolworths are also offering a $50 bonus shopping card if you apply before 31 March 2010 and make three purchasse on your new card by May 2010.
Bottom line: If you spend a lot at Woolworths, you may just earn enough points to negate the cost of the high purchase rate. Obviously if you're the type of consumer who pays their balance in full before the expiration of the interest free period, you'll get good value from the card. For others, consider a card with a lower purchase rate and a broader rewards program.
