Cards on the table: Latest 5-Star Rated credit cards revealed

While Australians have been reducing their credit card debt during the coronavirus pandemic, many could still stand to save on fees and interest – or get more back from their card in rewards – by moving to an outstanding value card, according to Canstar’s latest review of the credit cards on its database.

Figures released last week by the Reserve Bank of Australia show that consumers collectively wiped a massive $6.34 billion off their debt-accruing personal credit card balances from March 2020 to the end of August, as coronavirus restrictions have impacted spending. But the nation’s total debt-bearing personal credit card balance still stands at around $20.6 billion or $1,581 on average per account, and according to Canstar data, some consumers could be paying considerably more in fees and interest than they would with a 5-Star Rated card.

What difference could a 5-Star Rated credit card make?

Canstar’s analysis shows there is a significant difference in the average interest rates and fees charged by low rate and low fee cards on the database, compared to those found to offer 5-Star value.

Card type Purchase rate Annual fee
5-Star average Database average 5-Star average Database average
Low rate 9.65% 16.44% $44 $90
Low fee 11.71% 16.34% $0 $90

For cards that allow customers to earn points or offer rewards, 5-Star Rated products also offer customers more bang for their buck on average, according to Canstar Research.

Card type Reward return^
5-Star average Database average
Rewards $687.79 $387.90
Frequent Flyer $1,288.41 $705.53
Premium $404.89 $390.41

Source: www.canstar.com.au – 12/10/2020. Based on credit cards rated in Canstar’s Credit Card Star Ratings (October 2020). Rewards, Premium and Frequent Flyer profile figures above are based on a $60,000 annual spend level. ^Reward Return is calculated based on the dollar value of rewards earned over 12 months. Please see the Canstar Credit Card Star Ratings methodology for more information on how Reward Return is calculated for each profile. Premium Reward Return is calculated by taking the best yearly dollar return from either frequent flyer rewards or general rewards, and only considers cards with a rewards program.

How were credit cards assessed?

As part of its latest six-monthly Credit Card Star Ratings, Canstar Research assessed 167 products based on their price and the features they offer. Cards were split into five main categories, or consumer profiles.

  • Low rate – for consumers who want a low rate and flexible repayment conditions
  • Low fee – for those looking for a low ongoing fee and potential access to some premium features
  • Premium – for consumers who want a card that offers more benefits and frills than a more basic credit card would, such as access to a concierge service or complimentary travel insurance
  • Rewards – for those who want to earn a return on their everyday spending, in the form of cash-back, gift cards or lifestyle rewards, for example
  • Frequent flyer – suitable for those who want to be able to redeem card points for flights. Due to international travel restrictions, only domestic redemption of points was taken into account for these Ratings.

Rewards and frequent flyer cards were assessed against annual spend amounts of $12k, $24k, $36k, $60k and $120k, and premium cards against annual spend amounts of $24k, $60k and $120k. Low rate and low fee cards, on the other hand, were each assessed based on a single annual spend amount of $12k and $6k, respectively.

Canstar Research has its own way of comparing credit cards for each consumer profile. The Star Ratings calculations for each profile are based on how consumers typically use that type of card, taking into account a range of variable factors that together determine the value a card delivers.

These factors include:

  • Fees, including annual fees, late payment fees and dishonour fees
  • Interest rates, including purchase rates and cash advance rates, as well as any applicable currency exchange rates
  • Number of interest-free days offered on purchases
  • Standard features such as purchase protection insurance and online card management
  • Premium features such as additional complimentary insurance and concierge services (where applicable)
  • Loyalty or rewards programs such as frequent flyer schemes.

5-Star Rated credit cards

In total, 53 credit cards received a 5-Star Rating. See below a list of these outstanding value credit cards in each profile (sorted by provider name alphabetically). To see how each card on Canstar’s database was rated based on various profiles, visit the credit card comparison tables.

5-Star Rated low rate credit cards

American Express Low Rate Credit Card
Auswide Bank Low Rate Visa
Bank First Visa Platinum Credit Card
Bank of us Visa Credit Card
Bendigo Bank Low Rate First Mastercard (for<25)
Bendigo Bank Low Rate Mastercard
Community First CU Low Rate Blue Credit Card
Community First CU Low Rate Credit Card
Community First CU Low Rate Pink Credit Card
Endeavour Mutual Bank Visa Credit Card
G&C Mutual Bank Low Rate Visa Credit Card
Latitude Financial Services Low Rate Mastercard
MOVE Bank Low Rate Credit Card
Sydney Mutual Bank Visa Credit Card

5-Star Rated low fee credit cards

American Express Low Rate Credit Card
Bank First Visa Classic Credit Card
BankVic Visa Silver
Heritage Bank Gold Low Rate
Horizon Bank Visa Credit Card
Hume Bank Value
ING Orange One Low Rate
ME Frank Credit Card
QBANK Bluey Card
Qudos Bank Lifestyle
Teachers Mutual Bank Credit Card
UniBank Credit Card

5-Star Rated premium credit cards

These premium cards were awarded a 5-Star Rating based on a $24k annual spend amount.

ANZ Rewards Platinum
Bankwest More Platinum Mastercard
Bendigo Bank Platinum Rewards Mastercard
HSBC Platinum Credit Card

These premium cards were awarded a 5-Star Rating based on a $60k annual spend amount.

ANZ Rewards Platinum
Bankwest More Platinum Mastercard
Bendigo Bank Platinum Rewards Mastercard
Commonwealth Bank Ultimate Awards – Rewards Option
HSBC Platinum Credit Card
NAB Rewards Platinum Card

These premium cards were awarded a 5-Star Rating based on a $120k annual spend amount.

ANZ Rewards Platinum
Bank of Melbourne Amplify Platinum – Rewards Option
BankSA Amplify Platinum – Rewards Option
Bankwest More World Mastercard
Bendigo Bank Platinum Rewards Mastercard
Commonwealth Bank Ultimate Awards – Rewards Option
HSBC Platinum Credit Card
St.George Bank Amplify Platinum – Rewards Option
Westpac Altitude Platinum – Rewards Option

5-Star Rated rewards credit cards

These rewards cards were awarded a 5-Star Rating based on a $12k annual spend amount.

American Express David Jones Card – Rewards Option
American Express Essential Credit Card
HSBC Platinum Credit Card
Latitude Financial Services Infinity Rewards Visa

These rewards cards were awarded a 5-Star Rating based on a $24k annual spend amount.

American Express David Jones Card – Rewards Option
Latitude Financial Services Infinity Rewards Visa
Summerland Credit Union Rewards Card

These rewards cards were awarded a 5-Star Rating based on a $36k annual spend amount.

American Express David Jones Card – Rewards Option
Commonwealth Bank Ultimate Awards – Rewards Option
Latitude Financial Services Infinity Rewards Visa
Summerland Credit Union Rewards Card

These rewards cards were awarded a 5-Star Rating based on a $60k annual spend amount.

American Express David Jones Card – Rewards Option
American Express David Jones Platinum Card – Rewards
Bankwest More Platinum Mastercard
Commonwealth Bank Ultimate Awards – Rewards Option
Summerland Credit Union Rewards Card

These rewards cards were awarded a 5-Star Rating based on a $120k annual spend amount.

American Express David Jones Card – Rewards Option
American Express David Jones Platinum Card – Rewards
Bankwest More Platinum Mastercard
Bankwest More World Mastercard
Coles Rewards Mastercard
Commonwealth Bank Ultimate Awards – Rewards Option

5-Star Rated frequent flyer credit cards

These frequent flyer cards were awarded a 5-Star Rating based on a $12k annual spend amount.

American Express Essential Credit Card
American Express Explorer Credit Card
American Express Platinum Edge Credit Card
American Express Qantas Discovery Card
American Express Velocity Escape Card
American Express Velocity Platinum Card
HSBC Platinum Credit Card

These frequent flyer cards were awarded a 5-Star Rating based on a $24k annual spend amount.

American Express David Jones Card – Qantas Option
American Express David Jones Platinum Card – Qantas
American Express Explorer Credit Card
American Express Platinum Edge Credit Card
American Express Velocity Platinum Card

These frequent flyer cards were awarded a 5-Star Rating based on a $36k annual spend amount.

American Express David Jones Card – Qantas Option
American Express David Jones Platinum Card – Qantas
American Express Explorer Credit Card
American Express Platinum Edge Credit Card
American Express Qantas Ultimate Card
American Express Velocity Platinum Card
Commonwealth Bank Ultimate Awards – Rewards Option
Commonwealth Bank Ultimate Awards – Qantas Option

These frequent flyer cards were awarded a 5-Star Rating based on a $60k annual spend amount.

American Express David Jones Platinum Card – Qantas
American Express David Jones Card – Qantas Option
American Express Qantas Ultimate Card
American Express Explorer Credit Card
American Express Platinum Edge Credit Card
American Express Velocity Platinum Card
Commonwealth Bank Ultimate Awards – Rewards Option
Commonwealth Bank Ultimate Awards – Qantas Option
Diners Club Australia Personal Dual Card

These frequent flyer cards were awarded a 5-Star Rating based on a $120k annual spend amount.

American Express David Jones Platinum Card – Qantas
American Express David Jones Card – Qantas Option
American Express Qantas Ultimate Card
American Express Explorer Credit Card
American Express David Jones Platinum Card – Rewards
American Express Velocity Platinum Card
Commonwealth Bank Ultimate Awards – Rewards Option
Commonwealth Bank Ultimate Awards – Qantas Option
Diners Club Australia Personal Dual Card

For more information about how Canstar’s Credit Card Star Ratings are determined, take a look at the methodology and report.

This article was reviewed by our Sub Editor Tom Letts before it was published, as part of our fact-checking process.

Main image source: Konstantin Kolosov (Shutterstock). 

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