About HSBC Cash Rewards Mastercard
The HSBC Cash Rewards Mastercard is a cash back credit card that generates free cash rewards for nearly every purchase you make with your card.
HSBC is a British bank that originally started in Hong Kong back in the 1800’s. Its original name was Hongkong and Shanghai Banking Corporation (HSBC). Over time, their business grew and they eventually opened up banks in the United States.
While they aren’t the most well-known bank in the country, their cash rewards credit card has some serious cash perks that make it, in our opinion, one of the stronger choices for a cash back card.
Exactly why we think it’s one of the best and why it could be a good fit for you is something we’ll explore in this review by walking you through the following topics related to this card:
- The cash rewards
- Non-cash benefits
- Rates and fees
- Comparison to other cards
At the end of this review, we’ll take a few minutes to give you our thoughts about the card’s overall pros and cons.
The HSBC Cash Rewards Card’s Cash Bonuses
This card has two main cash-related rewards: the sign-up bonus and spending bonuses.
First, you’ll earn a $150 reward if you can spend $500 in the first three months of owning the card. This bonus amount is pretty much the industry standard – both the Chase Freedom Unlimited and the Capital One Quicksilver offer the same cash bonus.
The three-month deadline starts the day you are approved. So, if for some reason your card doesn’t get to you until a month after you’re approved, you have two months left to hit the $500 spending target.
Also, any balance transfers you make to this card and any interest payments you make won’t count toward the $500 requirement.
It will take about four to six weeks for your $150 bonus to show up in your rewards balance, which you can view by logging into your HSBC credit card account.
What you’ll actually see is a balance of points and those points are worth $1 for every hundred. So, your $150 is actually 15,000 points. This is important to understand when we talk about the next way to earn rewards.
Nearly every time you use your HSBC Cash Rewards card you’re going to earn 1.5 points for every dollar you spend. So, a $100 purchase will earn you 150 points. If you were to redeem those points for cash, you’d earn $1.50.
You can earn an unlimited number of points on your purchases. We estimate yearly credit card spending for a family to be between $25,000 and $30,000. Based on these numbers, we think you can earn between 37,500 and 45,000 points, or cash rewards totaling $375 and $450.
A few reminders:
- Late fees, interest payments, and balance transfers don’t earn rewards
- You’ll lose your points if you close your account or default on your payments
The HSBC Cash Rewards Mastercard’s Non-Cash Benefits
The HSBC card has a series of insurance-style protections and coverages for everything from lost luggage and roadside assistance to travel accident insurance, price protection, and extended warranties.
Each one of the benefits has certain limitations, including dollar amounts you can claim each year and which purchases qualify for things like price protection.
A full explanation of the benefits is included with your card when HSBC sends it to you.
Yearly 10% Bonus
Each year on your cardmember anniversary, HSBC will give a chunk of bonus points equal to 10% of the amount of rewards you earned during the year. If you racked up 37,500 points, HSBC will give you a 3,750-point bonus.
You’ll also get 0% interest on balance transfers for 15 months. It’s a great deal if you have a high-interest balance you want to transfer, but, unlike the leading cash back cards, this interest rate doesn’t apply to purchases.
The HSBC Cash Rewards Mastercard’s Rates and Fees
The rewards your card will earn you are a nice perk but the quickest way to negate those rewards is to carry a balance and pay interest.
Many of us who have credit cards do carry a balance – about 40%. And of that 40%, the average balance is around $16,000. So, when you’re considering a cash back card, it’s really important to know what the card’s interest rates and fees are just in case you have to carry a balance.
Here are the HSBC card’s rates and fees:
- APR: 14.24%, 18.24%, 24.24%
- Penalty APR: 31.24%
- Cash advance APR: 26.24%
- Balance transfer/cash advance fee: 4%
- Late payment fee: Up to $37
- Returned payment fee: Up to $25
As we mentioned a few seconds ago, APR is important because it dictates how much interest you’ll pay. The HSBC Cash Rewards’ interest rate is pretty competitive.
In fact, its lowest APR of 14.24% (reserved for those with credit scores around 700 and above) is better than the card we chose as the best cash back credit card of 2018, the Citi Double Cash.
Based on our research, we think that the HSBC card has a great interest rate if you have the credit scores to get it. Remember, the lower your scores are and the more late payments you have in the past few years, the less of a chance you’ll have to get the best APR.
Now, there’s one other APR you need to be aware of – penalty APR. This is an interest rate that kicks in if you make a late payment. The card’s fine print says that HSBC “may” apply the rate to your card on your first late payment but we think this is a situation in which you don’t want to take the chance.
Why? Because the penalty APR on this card is 31.24%, a rate that we’ve never seen before on a cash rewards credit cards. Usually, penalty APR is 29.99%.
You can now see why we’re discouraging you from making a late payment. Even though the fine print says it’s not a guarantee you’ll get the rate, it’s not worth gambling. When this APR kicks in, it will apply to all future purchases.
However, the card’s terms and conditions say that if your payment is more than 60 days late, the penalty APR will apply to new purchases and current balances.
It’s not the end of the world if you get the penalty APR, though. HSBC says they’ll review your account every six months to see if you’re eligible for penalty removal. A good way to convince them you deserve your regular APR is to make payments on time every month.
How the HSBC Cash Rewards Mastercard Compares to Other Cash Back Cards
Cash back credit cards fall into two categories: flat-rate and category bonuses. This HSBC card falls into the flat-rate group – you get one rewards rate for all purchases. Other flat-rate cards are the Citi Double Cash, Capital One Quicksilver and the Chase Freedom Unlimited.
We’ll focus our comparison on these cards since they’re most like the HSBC card. As a side note, we’ll point out that a good example of a category-bonus card is the Discover it, which has a flat-rate of 1% and bonus rates on gas, grocery, warehouse and Amazon purchases that change very quarter.
Now, back to the flat-rate cards. Here’s a chart to compare each of them according to the categories that are most important:
|Card||Rewards Rate||Sign-up Bonus||Yearly Rewards on $25K Spending||0% APR Length||Low APR||Penalty APR|
|HSBC Cash Rewards||1.5x||$150||$412.50||15 months (transfers only)||14.24%||31.24%|
|Citi Double Cash||2x||None||$500||18 months (transfers only)||14.74%||29.99%|
|Chase Freedom Unlimited||1.5x||$150||$375||15 months||16.24%||None|
|Capital One Quicksilver||1.5x||$150||$375||9 months||14.24%||None|
Based on our research of these cards, we believe the HSBC card is the second-best option for you. Its interest rate is tied for the lowest with the Quicksilver and its yearly rewards are second to the Double Cash.
However, if you tend to make late payments on your card, the HSBC’s extremely high penalty APR can really hurt you, especially if you build a balance on the card after the APR applies.
The “benefit” of the HSBC card’s penalty APR is that it could be removed after six months. The Citi Double Cash’s terms and conditions say that, if you get the penalty APR, it could apply to your account indefinitely.
Pros and Cons of the HSBC Cash Rewards Mastercard
In our opinion, this card’s greatest strength is its combination of a low APR and the 10% rewards bonus you get on your cardmember anniversary.
When you couple the low-interest rate with the bonus and the 1.5x cash-back rate on purchases, there’s a really good chance this card could earn you enough rewards every year to beat out every card but the Citi Double Cash.
If you carry a balance on your card of at least $3,000 every day, the money you pay for interest will most likely exceed what you earn in rewards. However, those interest payments will be lower than all but one of the major cash back cards we’ve reviewed: the Discover it.
The downsides of the HSBC card are the high penalty APR and the fact that their 0% APR offer only applies to balance transfers. Now, in theory, if you pay your bill on time every month and in full, then the absence of a 0% purchase offer and the presence of the penalty APR won’t affect you.
If you want to do some more research before making your decision about this card, take a look at our reviews of the Citi Double Cash, Chase Freedom Unlimited, and the Capital One Quicksilver. These cards are most similar to the HSBC Cash Rewards and will help you see some of the nuances that make them different.