The Trading 212 Card: Rewards, FX, and the Trade-Offs

In this episode of Banking Without Borders, we break down the Trading 212 card and discuss its benefits and why it is such a great rewards card. 

We cover:

• What the Trading 212 card actually is (and what it isn’t)
• How FX spending works, including when fees do and don’t apply
• ATM withdrawal limits and where the caps kick in
• How cashback works in practice, including caps and auto-investing
• The maths behind the headline cashback rates
• Why rewards are being reinvested rather than paid out as cash
• Who this card is really for — and who it isn’t

If you’re using the Trading 212 card, considering it, or comparing it to other cashback and travel cards, this episode will help you understand the trade-offs behind the design and whether it fits how you actually spend and invest.

Get £25 when you sign-up for Trading 212 and make 3 transactions over £5

Code: BWB

Affiliate link: https://www.trading212.com/join/BWB 

Connect with us (via LinkedIn)

Jan: https://www.linkedin.com/in/jan-watermann/

Jonny: http://www.linkedin.com/in/jonny-pease

Connect with us (via LinkedIn)

Jan: https://www.linkedin.com/in/jan-watermann/

Jonny: http://www.linkedin.com/in/jonny-pease

Got a question or topic you want us to cover? Drop us a message at jonny@technicallymoney.com

Transcript

00:00:00:00 – 00:00:20:09
Speaker
Okay, let's talk about the Trading 212 card because it's been around for a while now. But it's so interesting. And I mean, I just love the message that this card sends because while a lot of UK banks have been quietly pulling back on rewards — Chase UK being the obvious one, but also Barclays and Santander — Trading 212, which isn't a bank, has gone the other way.

00:00:20:12 – 00:00:48:17
Speaker
They've chosen to reward customers, but to do it in a very specific way that encourages investing rather than pure consumption. And thanks to the auto-invest feature, your cashback can be reinvested automatically into equities or funds, with the potential to earn far more than the original cashback itself. And I think that design choice tells you exactly who this card is for and who it's not, which is something we'll touch on later in the episode.

00:00:48:21 – 00:00:49:22
Speaker
But for now, Jan—

00:00:50:00 – 00:00:55:00
Speaker
This card is an absolute beast, right? I think we can all agree on that.

00:00:55:03 – 00:01:18:08
Speaker
Yeah. Johnny, it's an excellent option. And first of all, let me mention this card is actually not issued by Trading 212, but by a partner of theirs called Paynetics Limited. And it's available with Trading 212’s investment account. It's not a standalone current account. I think that's what some people get wrong. You're essentially spending your own money from invested cash inside their investment platform.

00:01:18:10 – 00:01:39:18
Speaker
You cannot receive funds from third parties. You have to fund the account from your own bank account, which you can either link within the app — that's a really seamless process — or you can also fund the card through other payment methods such as Apple Pay, Google Pay, or debit card recharges.

00:01:39:20 – 00:01:43:14
Speaker
Although, important to mention, that's limited to £2,000.

00:01:43:17 – 00:01:52:02
Speaker
Afterwards, there's a 0.7% fee, which makes sense because these transactions probably incur a fee on their side as well.

00:01:52:02 – 00:02:00:10
Speaker
Otherwise, yeah. There aren't a huge amount of fees to discuss here. Let's just quickly touch on what a beast this card is for spending internationally.

00:02:00:10 – 00:02:09:08
Speaker
Say you're on holiday, you use your Trading 212 card to spend money. You don't incur any fees. There may be other fees elsewhere.

00:02:09:08 – 00:02:27:22
Speaker
So if you exchange currencies within the Trading 212 app, there's a 0.15% fee. Yes, that's a fee. But when you're spending money internationally, you just get the interbank rate, which is a fantastic exchange rate. There's no margin. There's no fixed fee — as long as you choose to pay in the local currency if you're prompted.

00:02:27:22 – 00:02:34:01
Speaker
So at the point of sale, if the card machine asks you what currency you want to pay in, it'll say GBP or EUR.

00:02:34:07 – 00:02:38:10
Speaker
Say if you're in Spain, just select EUR — select the local currency.

00:02:38:10 – 00:02:44:07
Speaker
And that's it. I love how simple the card is, Yann. Just simple, straightforward, and transparent.

00:02:44:07 – 00:02:58:16
Speaker
What's also really fascinating is their ATM withdrawal limit — £400 per month. That should be enough for most people, maybe an exception if you're travelling to a destination that's more cash-heavy.

00:02:58:18 – 00:03:08:21
Speaker
Let's say you're traveling to Thailand — then £400 per month might not be enough because you'll make most of your daily purchases in cash over there.

00:03:08:21 – 00:03:20:07
Speaker
But if you're traveling within the European Union, within the UK, or to North America, then £400 per month in free ATM withdrawals is probably sufficient.

00:03:20:09 – 00:03:24:02
Speaker
If you exceed that, it's a 1% fee on withdrawals above the limit.

00:03:24:02 – 00:03:35:21
Speaker
Something to keep in mind though — the local ATM operator might charge a fee. So it’s always worth checking which ATM is the cheapest.

00:03:35:23 – 00:03:52:09
Speaker
You can also earn cashback when spending internationally, which obviously won’t apply to ATM withdrawals. A lot of cashback or rewards cards don’t offer that. For example, American Express — do they let you earn Amex points for international transactions?

00:03:52:09 – 00:04:04:18
Speaker
Sometimes you get a preferential rate, but you also have to pay a fee. With Trading 212, you earn cashback internationally at no extra cost, which is a really nice benefit.

00:04:04:18 – 00:04:08:04
Speaker
And when it comes to earning cashback — the main headline of the card.

00:04:08:09 – 00:04:25:21
Speaker
So it starts at 0.5%. But if you turn on invest-in-cashback, which essentially takes your cashback and invests it into equities or stocks and shares of your choice or ETFs — so funds or even pies — you can then earn 1.5%.

00:04:25:21 – 00:04:32:07
Speaker
Which makes it pretty much — because this applies to everyday spending or everyday transactions —

00:04:32:07 – 00:04:52:04
Speaker
That pretty much makes this the most competitive card, or at least a very, very good card in the UK. Yann, there is a cap of £1,000 on 1.5% and £3,000 per month on — no, I fucked that up. No.

00:04:52:06 – 00:04:54:06
Speaker
 Pounds per month in total cashback.

00:04:54:08 – 00:05:01:16
Speaker
Yes. In order to earn that, you’ve got to spend — at 1.5% — you’ve got to spend £3,000 every month.

00:05:01:18 – 00:05:04:02
Speaker
Yeah, I see. Thanks.

00:05:04:08 – 00:05:13:21
Speaker
And that's pretty attractive, especially if you consider the card does not have a base fee. There are some alternatives out there, yes — for sure.

00:05:13:21 – 00:05:25:19
Speaker
Maybe Chase UK is a good example because that's capped at £15 per month. But overall, this is a little more attractive because it doesn't have limitations to certain categories.

00:05:25:19 – 00:05:34:08
 Speaker
 And the cashback applies abroad as well, right? All over the world, on all kinds of spending?

00:05:34:10 – 00:05:46:15
Speaker
Yes. Apart from the exclusions shown on screen — cash withdrawals and some other things. Overall, these look pretty fair to me. Logical exceptions. This is a really good option.

00:05:46:17 – 00:06:06:17
Speaker
I really love the way they've made it so simple to reinvest your cashback as well. Within the app, you can just select the companies or ETFs you want to invest in. That’s a really interesting and unique advantage.

00:06:06:19 – 00:06:16:06
Speaker
Well, you should be able to invest in the companies you're investing your cashback into. But is that really so good? I would rather have it in cash personally.

00:06:16:10 – 00:06:22:14
Speaker
Well, you can sell them.

00:06:22:19 – 00:06:39:04
Speaker
You can sell them, yeah. That’s the point. And I understand why they increase the cashback if you decide to invest on their platform. It makes sense — they want to encourage people to use their product.

00:06:39:06 – 00:06:50:19
Speaker
And it’s a great investment platform as well, just as a side note. So it is attractive to activate cashback investing in order to get the extra 1%.

00:06:50:19 – 00:07:07:04
Speaker
By the way, we should mention this is a promo which is limited. It’s currently running — it may be extended — but you should always check within the Trading 212 app or on the website to see whether the promo is still active.

00:07:07:09 – 00:07:21:20
Speaker
Yeah. I can’t speculate whether it will be extended or not, but based on last year, they seem to constantly extend it. It’s clearly compelling and has been in place for quite some time.

00:07:21:22 – 00:07:38:18
Speaker
Probably working extremely well for them — getting people more actively investing, spending more time on the app.

00:07:38:21 – 00:07:54:09
Speaker
It’s not a current account, but you do get some features that legacy banks charge for — like single-use virtual cards.

00:07:54:09 – 00:07:57:23
Speaker
Monzo charges for that, don’t they?

00:07:57:23 – 00:08:03:23
Speaker
Yeah, Monzo does charge for virtual cards. I think it’s £3 a month.

00:08:03:23 – 00:08:14:05
Speaker
I used it today for a phone case purchase — really easy to use — and the cashback came into the account very quickly.

00:08:14:09 – 00:08:39:14
Speaker
Historically, cashback systems can take weeks or even a year, like with American Express. With Trading 212, it’s pretty much instantaneous.

00:09:00:06 – 00:09:24:19
Speaker
Are there drawbacks? The biggest thing is you are becoming a customer of an investment platform. That’s not necessarily a drawback, but something to be conscious of.

00:09:24:19 – 00:10:08:17
Speaker
If you're susceptible to market behaviour — meme stocks, volatile markets — just be careful.

00:10:08:18 – 00:11:16:07
Speaker
It can also be a gentle way to dip your toes into investing, using small cashback amounts from spending you’d make anyway.

00:11:16:07 – 00:11:31:18
Speaker
There are retailer offers as well — up to 10% or even 14% cashback in some cases — which can then be invested.

00:11:31:20 – 00:12:06:04
Speaker
It’s a card without a base fee, with excellent conditions. I struggle to find major downsides. It’s a no-brainer for me personally.

00:12:06:06 – 00:12:39:07
Speaker
I’ve got a trip to Chile coming up, spending in foreign currencies — this feels like the best choice for me.

00:12:39:09 – 00:13:03:21
Speaker
If you're thinking about signing up, we currently have an offer available. Use the coupon code BWB — details in the description —, and you can earn £25 after making three transactions over £5.

00:13:04:00 – 00:13:46:22
Speaker
Thanks for listening. We really appreciate the support. Goodbye everybody — see you next time.