Premium credit cards

Premium cards are only offered to high earners with strong credit scores and can be seen as a status symbol. They also tend to come with reward schemes. If you think you may be eligible, find out more about some of the advantages and what to watch out for.

Premium cards are only offered to high earners with strong credit scores and can be seen as a status symbol. They also tend to come with reward schemes. If you think you may be eligible, find out more about some of the advantages and what to watch out for.

Alex Hasty
Insurance and finance expert
3
minute read
Do you know someone who could benefit from this article?
Last Updated 5 APRIL 2022

What is a premium credit card?

A premium card is similar to a standard credit card, but it comes with an annual fee in return for perks and benefits. Often referred to as black or purple credit cards, they tend to be reserved for big spenders with high incomes.

What’s included with a premium credit card?

It depends on the card you choose. Common perks included with a premium credit card include:

  • A higher credit limit
  • A generous rewards scheme
  • Travel insurance for you and your family
  • Breakdown cover
  • Home emergency cover 
  • Access to exclusive airport lounges worldwide
  • 24/7 concierge or personal assistance service

What are the benefits of a premium card?

The main benefit of having a premium credit card is the rewards they offer. These include:

  • Travel benefits – which can include access to exclusive airport lounges, worldwide travel insurance  and other concierge services such as for booking travel and accommodation. Your premium package may also include air miles that you can build up with each purchase and use for free or discounted flights.
  • Lifestyle benefits - they can have generous rewards schemes that give you points for shopping at particular retailers. Other benefits can include breakdown cover and home emergency cover.

If you’re a frequent traveller or enjoy regular nights out, the perks that come with some premium cards can be especially appealing. If the benefits are useful to you, and you use them to their full advantage, a premium card could offer value for money. 

What are the disadvantages of premium credit cards?

There are a few downsides to premium credit cards:

  • Hefty annual fee – all those perks don’t come free. You’ll be paying for them with a large annual fee - sometimes as much as £700. If you don’t use the perks, you’ll basically be wasting money. 
  • High credit limit – you may be tempted to spend big time, which could lead to more debt if you can’t pay off the whole balance at the end of the month. 
  • High interest rates – interest charges can often be higher than a standard credit card. If you want to keep costs down, a premium card might not be the best choice. 

Top tip

If your premium credit card includes travel insurance, check to make sure it gives you the level of cover you need. For example, pre-existing medical conditions are often excluded. If this is the case, you may have to take out a separate travel insurance policy.

Who can get a premium card?

Premium cards are only usually offered to those with an excellent credit rating, and some are invitation-only. To be eligible you’ll need to be over 21 years old and earning £40,000-50,000 or more, although it will vary between providers. However, even if you qualify for a premium card, unless you can afford to use it regularly to benefit from the perks, a cashback card or use abroad card might be a better option for you.

How much do premium cards cost?

Premium credit cards all come with an annual fee, which will vary depending on the card and benefits package you have. Annual fees can vary from £100 to as much as £700, so it’s important to make sure you’re making full use of the benefits.

APR rates are often very high for premium credit cards, but this is because it takes into consideration the fees you pay. For example, the actual interest rate for your repayments could be around 15-20%, but the APR shown could be 50% as it includes the annual charge you pay for the card.

What do I need to watch out for?

There’s rarely a 0% introductory period with a premium card and APR rates can be very high. So if you’re not someone that pays off their balance in full every month, a premium card might not be for you.

Premium credit cards often come with high credit limits so you should be careful as it can become harder to make your minimum repayments when you borrow more.

Take into consideration how regularly you’ll use the perks available for a premium card. You may be able to find some of the perks, like travel insurance, cheaper elsewhere. Or you may already have them.

How do I apply for a premium credit card?

Before you apply for a premium or high credit limit credit card, check the terms and conditions to make sure you fit the criteria set out by the card provider. Eligibility can be a lot stricter than for a standard credit card, and will often depend on your annual salary, age and credit history.

You can save time by using our eligibility checker to see which cards you’re likely to be eligible for. It’s a soft credit search , so it won’t impact your credit score in any way.

Compare the Market Limited acts as a credit broker, not a lender. To apply you must be a UK resident and meet the minimum age criteria set by the card provider. Credit is subject to status and eligibility.

Compare credit cards

If you’re currently looking for the right credit card for you, then we can help you to compare from some of the market’s leading providers. Simply use our easy-to-use comparison service.

Frequently asked questions

How do premium credit cards compare to standard credit cards?

While premium credit cards allow you to enjoy exclusive rewards that you might not get with a standard card, there are other differences to be aware of:

  • Premium cards always come with an annual fee, whereas some standard cards are fee-free 
  • It’s unlikely you’ll find a premium card with a 0% interest introductory offer, unlike many standard credit cards
  • Some premium cards are actually charge cards – unlike standard cards, you can’t borrow against them, and you’ll need to pay off the full balance each month
  • The minimum age for standard credit cards is typically 18 years old – most premium cards require you to be at least 21 years old

Is a premium credit card worth it?

There’s no doubt that some premium credit cards offer fantastic perks. If you travel frequently and can make good use of the prestigious concierge services, a premium card might be worth considering. 

But if you’re looking to save money and can’t always pay off the full balance each month, a premium credit card could end up costing you a fortune. If you think the annual fee could be better spent elsewhere, you might want to look for an alternative credit card. 

What alternatives are there to premium credit cards?

If you want a credit card that can help you save money, there are plenty out there with useful perks of their own, including:

  • Rewards cards can offer a whole heap of goodies – from cashback and shopping vouchers, to air miles and ticket discounts for family days out.
  • 0% credit cards can offer an interest free period on balance transfers or purchases, allowing you to spread your repayments over the 0% term without paying any interest at all. 
  • Travel credit cards can offer low or no fees and better exchange rates compared to standard or premium credit cards when you use them abroad.

Looking for a credit card?

Compare credit cards quickly and easily

Compare now
Compare credit cards now Find a card