Qantas Cash is a prepaid debit card that doubles as your Qantas Frequent Flyer membership card. It is the only financial product in New Zealand that you can readily obtain which allows you to direct earn Qantas Points on everyday spend.
The card has an earn rate of 1 point per $2 for spend in New Zealand Dollars, and 1 point per $1 spent in foreign currency (either abroad or online).
This is a guide that looks at the card basics, the costs to use, and our take on whether its worth using on spend either in New Zealand, or abroad.
Qantas Cash – the basics
|Loyalty Program||Qantas Frequent Flyer|
|Points earned from spend||1 point per $2 on domestic spend|
1 point per $1 on spend in foreign currency (either online or abroad)
|Load fee||No load, reload, transaction, cash out, card to card transfer or monthly fees|
|International ATM withdrawal fee||~$2.50 NZD equivalent (depends on local currency)|
|Annual fee||$0 p.a.|
For many points collectors in Australia, the Qantas Cash card doesn’t rate very highly, but in New Zealand, it could be a good card to have for those who can’t get or who don’t want a credit card, and want to earn Qantas Points.
For example, Qantas Cash has a lower age restriction than most credit cards (16 years vs 18 years), so high schoolers can start earning their own points from their own personal spend.
You also won’t need a credit check to apply for one.
Digging into the details of the Qantas Cash card
Qantas Cash is a reloadable prepaid debit card, meaning that you are never spending the bank’s money (credit), but rather need to load it up with your own money before it can be used.
It markets itself primarily as a travel card, but there is limited value here – we’ll go into more depth on the reasons why later. But as a daily spender, it could be useful to some.
It’s also your Qantas Frequent Flyer membership card, so you can use it to fast-track check-in at the airport, for example.
The card can be loaded via bank transfer, which can take a couple of days at worst. It is not possible to load up using credit cards and other card types. You can cash out any unspent money to your bank account at no fee.
Spend in New Zealand
The Qantas Cash card earns 1 Qantas Point for every $2 spent on eligible transactions at home in New Zealand. Eligible spend includes pretty much everything (including the IRD) but specifically excludes money orders, traveller’s cheques, gambling chips or purchasing foreign currencies in cash.
Considering that the ANZ Qantas Platinum Card, when it was still offered, capped your earn rate to the same once you spent over $20,000 in a year (even with a $149 annual fee), we consider the Qantas Cash earn rate to be pretty decent, especially considering that it is free.
It also compares well to the Amex Platinum Edge card, where spend outside supermarkets and petrol stations will see you effectively earn Qantas Points at the same rate.
Spend outside New Zealand
The Qantas Cash card has a boosted points earn rate for international transactions, at 1 Qantas Point per $1 (NZD equivalent) spent on foreign currency transactions.
By far the biggest problem with Qantas Cash is its poor exchange rates when locking in at the different currencies on offer (specifically, the “padding” over and above the base MasterCard rate). Granted, this is a free card, and this is a big part of how they make their money.
‘Locking in’ your exchange rate now by converting everything over to the foreign currency you need is not, in my view, a good strategy.
If our dollar falls, great – you’ve saved some money. But if the dollar goes up, you’ve just lost out. We’re not all professional currency traders (and even they get it wrong).
If you’re going to use the card on foreign currency spend, do so without locking in your NZD at any of the currencies offered on the card. This way, you’re limiting your exchange fees to only 2.5%, which is competitive with most rewards cards in New Zealand (read more on this below).
Is Qantas Cash worth it?
For example, let’s assume you will load up the equivalent of $20,000 NZD in US dollars for your big holiday and to take advantage of a bonus earning promotion.
According to Qantas’ rates (July 2017) of 1 NZD = 0.7222 USD, your $20,000 NZD will convert into $14,444 USD.
Now, let’s compare this to the current Mastercard rate of 1 NZD = 0.7509 USD, which you can access using this handy tool.
That rate alone is almost 4% better than the Qantas Cash rate, and tells you that the best rate with MasterCard would get you $15,019 USD.
Assuming that you have a Mastercard credit card that charges a 2.5% currency conversion fee (noting that there are cards available in the New Zealand market like the Flight Centre Mastercard and Q Mastercard that have only a 1.4% fee), you’re still ending up further ahead just using your own credit card overseas.
In fact, you can choose to just keep your money on the Qantas Cash card to spend overseas, not locking in any particular currency rate, and you’ll only have a 2.5% currency conversion fee added on top of the standard Mastercard rates. This is 1.5% cheaper than locking in the currency of the country that you’re travelling to.
We can do the same exercise for Visa using their calculator.
So, if we take the difference between these three options in converting $20,000 NZD, we can see that by choosing to lock in your currency through the Qantas Cash card, we have foregone between $575 and $614 in cash:
|Exchange rate||USD conversion||Difference compared to Qantas Cash|
This means we can put a value on our points!
Compared with the MasterCard base rate, we can see that (575 x 100) / 20000 gives us a value of ~2.87 cents per point, which means we are ‘buying’ Qantas Points at that rate. According to our points valuations, this is much too high for earning Qantas Points.
We’ve also locked our NZD into USD now, which means that if the NZD goes up, we lose out.
And finally, you either need to spend all of that USD overseas or risk losing even more value in transferring back to NZD.
Note that this is definitely the absolute best case for both Visa and Mastercard rates. Just remember that we are showing the maximum loss above. There are currently no cards that I am aware of in the NZ market that do not charge currency exchange fees – you’ll generally have a padding of up to 2.5% by using a credit card, or Qantas Cash without a locked in rate – noting however that this is still a saving, with a significant amount of added payment flexibility.
My experience of using the card on a trip
I took the Australian-issued Qantas Cash card with me on an overseas trip earlier in the year as a backup, loaded with a few hundred Australian dollars (not converted to any particular currency).
For the few places that I did use it, I found that because of the look of the card (the chip is on the front, but the card number and stripe are on the back), it did confuse a number of merchants who couldn’t figure out how to swipe it through their machines. It was quite amusing to watch, but also a bit embarrassing when you’re that Westerner holding up the queue.
Frustratingly, the Qantas Cash card was the only card I (have ever) had which I couldn’t change the PIN for (this has since been rectified – you can now change your PIN by calling the MasterCard Qantas Cash Global Support on 0800 101 500), so I almost got it blocked when I entered my regular PIN twice in a row – not something you want to deal with when you’re overseas!
After we returned, it took a good few weeks for the points to come through from our spending, but there were no other surprises. Unlike many other cards on the market today, there’s no transaction-by-transaction breakdown of your point earn, so it can be a little tricky to figure out exactly how the points were earned.
They also don’t publish their commission on a transaction-by-transaction level, so it’s impossible to go back and compare rates. The app and website are better than they used to be, but still a bit clunky.
- If you don’t want a credit card, but still want to earn points, you have very few options out there, so Qantas Cash could be quite useful here
- It’s the only remaining direct earn card product in New Zealand for Qantas Points. It is easy enough to use here at home, with no fees for domestic use
- The 2.5% currency exchange rate to use on overseas spend or on online shopping is competitive with many other credit cards in the New Zealand market, and will see you earn a good 1:1 rate on your spend. Just make sure you don’t lock in any other currencies
- Given that it’s prepaid, it’s easy to control your spending. When the money runs out, it has run out
- Students in their late teens can earn points from their own spending, without parents having to worry about supplementary cards and the inherent risks of giving your teenager access to an ‘unlimited’ supply of funds
- You are foregoing spend on other cards that offer lower fees on overseas transactions and/or withdrawals
- If you convert your NZD into any of the currencies offered by the card, you’re going to lose money, compared to comparative spend with a credit card, or with the Qantas Cash card without a locked in rate
- You are pushing your hard-earned cash into a prepaid account which earns no interest
- Qantas Cash used to be a way of paying for Qantas and Jetstar flights with no credit/debit card fees, however, since 2016, this option has been taken away by Qantas
I have observed over the years that the Qantas Cash card seems to provoke some pretty extreme responses – some people love it, and others hate it.
For many, it could be a handy little points earner where the alternative is earning no points at all. The key is to use it at home, or use it on foreign currency spend without a locked in rate. This is how you will save money using this card.
At least you can’t argue with free – the fact that it’s available to use with no-upfront fee means there is little risk in trying it out and seeing if it has some use to you.
Have you used Qantas Cash before? What was your experience of it?
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