Is over-50s specialist Saga axing its popular platinum credit card because of Brexit? The card is run for Saga by a Dublin-based bank and is closing on 28 March, hours before the UK is scheduled to leave the EU.
The Saga platinum credit card has long been a popular choice among people who travel abroad because it doesn’t charge currency conversion fees. Other benefits include up to 55 days of interest-free cash withdrawals, discounts on Saga holidays and cruises, and a low-ish typical interest rate of 11.9% APR.
But now the card is being shut down, which means customers have just two months to clear their debts and find another card provider – though they may struggle to find a comparable deal. It is understood Saga started writing to customers in mid-January, and everyone affected should have received a letter.
The card is operated on Saga’s behalf by Allied Irish Banks (AIB), but the over-50s specialist appeared to reject any link with Brexit, saying this was a longstanding arrangement that was coming to a natural conclusion on 28 March.
Nevertheless, with Brexit scheduled for 29 March, observers could not be blamed for seeing a possible connection.
Saga has not arranged a new card to which customers can switch. It says that under the terms and conditions, any customer with an outstanding debt on their card has 60 days to either pay it off or transfer the balance to a new provider. If a customer still owes money on 28 March, AIB “may decide to transfer the debt to a third party”. If this happens, customers could be hit with a higher interest rate. Saga says: “We are endeavouring to ensure that any customers with outstanding balances are protected and will not be left in a worse financial position.”
It adds that it is taking this opportunity to develop “an exciting new card for our customers which will have a superb range of features and rewarding benefits” – but some will wonder why Saga did not manage to get it ready in time for the end of the AIB contract.
Not surprisingly, the news has left many customers put out. “It is ridiculously badly managed and very unfair to bounce out account-holders with so little notice – especially some who doubtless have significant balances to settle right after Christmas,” one user said on MoneySavingExpert.com, adding it was irritating to have spent years building up a useful credit limit, only to have it “whipped away” by this decision.
Another said this could pose problems for those who are semi-retired or between jobs and not yet on a pension, as some credit cards require a minimum income. A third said: “We’re now having to apply for a new credit card as, for example, cruise lines will not take debit cards as guarantees of payment.”
Saga declined to say how many people hold the card, but says it is “a small portfolio of customers, of which only a fraction have outstanding balances”.
Replacing your Saga deal
So if you are affected by this move or simply looking for a new credit card, what deals are available?
If you want a card that has no fees for making overseas purchases or withdrawing cash abroad you might want to consider new banking player Tandem, which last month announced it had reached 500,000 customers. It offers a card with which you earn 0.5% cashback on purchases worldwide.
The Halifax Clarity card has no usage fees, and whatever you spend abroad is converted to sterling at a rate set by Mastercard.
Other credit cards that have no fees on both purchases and cash withdrawals abroad include Santander’s Zero, Creation’s Everyday, and Barclaycard’s Platinum Cashback Plus. With the latter, there are no fees on spending and withdrawals until 31 August 2023, and you get 0.25% cashback on all your spending until then.
In other card news, TSB is currently offering the carrot of £30 cashback to customers who take out a new Platinum, Classic or Student credit card before 1 March. Customers need to apply in branch and spend £30 on their new card on or before 27 March, and the cashback will be paid into their account by 19 April.