The free IHG Rewards credit card is closed to new applicants – what now?
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The UK rewards credit card market took another hit yesterday when applications were halted for the free IHG Rewards credit card.
If you look at its website, Creation – the issuer – has removed all of its remaining UK credit cards from the market. It also appears to have closed its personal loans business.
The bottom line is that Creation is, apparently, no longer accepting new business for any directly sold product.
We rated the IHG Rewards credit cards highly
The IHG Rewards Premium credit card – the version with the £99 annual fee – was closed in April 2020.
We liked the card so much that we gave it an ‘Editor’s Choice’ award in the Head for Points 2019 Travel & Loyalty Awards. The headline features of this card were:
- £99 annual fee
- 20,000 IHG Rewards points for joining and spending £200 in the first three months – these were worth about £80 of free hotel rooms or transferable to 4,000 Avios points or other airline miles
- Platinum Elite status in IHG Rewards for as long as you held the card
- 2 IHG Rewards points per £1 spent. I value IHG points at 0.4p so this was a 0.8% return.
- 4 IHG Rewards points per £1 when you paid at IHG hotels. This would be roughly a 1.6% return which is very good.
- 4 IHG Rewards points per £1 when you used the card abroad
- A free night voucher for any IHG hotel for spending £10,000. Used at the InterContinental Paris, London, New York etc, you could be looking at £250+ of value.
It is important to note that points from day-to-day spend counted towards elite status. A heavy spender could get Spire Elite status – requiring 75,000 points – simply by putting £37,500 of spending through this card.
The free IHG Rewards credit card wasn’t as good
Whilst the £99 card closed in April 2020, the free card continued to be offered.
We were less excited about the free IHG Rewards credit card, to be honest. That said, it was actually one of the most generous Visa or Mastercard credit cards on the market for travel rewards or any other reward.
It only earned 1 IHG Rewards point per £1 spent, half the rate of the paid card. However, as we value an IHG Rewards point at 0.4p, this meant a 0.4% return on your spending. It is very difficult to beat this with a free cashback or pseudo-cashback (ie store vouchers) Mastercard or Visa.
You didn’t get a free night voucher, unfortunately. You did get IHG Rewards Gold Elite status for as long as you held the card, which was a decent benefit for a free card.
The points you earned DID count towards IHG Rewards status. As hitting Spire Elite status at 75,000 base points (currently 55,000 base points) earns you a bonus of 25,000 IHG Rewards points, the card could be more lucrative than it looked.
Let’s imagine that you averaged 50,000 IHG Rewards base points per year from hotel stays. Spending £25,000 on the free IHG Rewards credit card would give you the extra 25,000 base points needed to trigger Spire Elite status at 75,000 points, and thus the bonus 25,000 IHG Rewards points.
Suddenly your average return on your card spend would double to an average of two points per £1. You’d also have a higher level of status next year than you would have otherwise achieved. It was an attractive package.
What next?
Good question.
Hilton Honors hasn’t managed to launch a replacement credit card, almost four years after their Barclaycard-issued product was closed to new applicants. It doesn’t bode well for IHG in finding a new issuer.
That said, the market is changing. The environment is now better for small card issuers to enter the market with digital-only or digital-first products, and a low cost base would hopefully allow enough margin to fund rewards.
The hotel companies also have more flexibility than airlines in being able to offer status as a card benefit. The cost of giving out status is low, since it is down to the independently owned hotels to fund your benefits, but it is valued by cardholders.
IHG led the way in counting the points you earn from card spend towards status, which was smart.
The only notable Visa or Mastercard with travel rewards now available is the Virgin Atlantic Rewards Mastercard. This is a very generous card, made possible because Virgin Atlantic and Virgin Money have a genuine partnership. Virgin Money doesn’t buy Virgin Points at arms length – the two companies have set up a joint venture company to run the card, allowing the airline to share in card fees, interest payments, FX fees etc. This allows it to sell Virgin Points into the joint venture at a low cost, allowing a generous earning rate.
For clarity, IHG has confirmed to me that existing IHG Rewards credit cards will remain open. You don’t have to rush to find a replacement.
That said, if Creation does intend to leave the UK entirely (it is a French business) it is likely that it will look to exit its existing loan book. This could mean:
- your IHG Rewards credit card is closed down and you pay down your balance over time
- your card account is sold to a new issuer, who may or may not continue to give you IHG Rewards points on your spending
- your card account is transferred to someone else who has agreed to launch a new IHG Rewards credit card
Let’s see.
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IHG One Rewards update – April 2025:
Get bonus points: IHG is not currently running a global promotion.
New to IHG One Rewards? Read our overview of IHG One Rewards here and our article on points expiry rules here. Our article on ‘What are IHG One Rewards points worth?’ is here.
Buy points: If you need additional IHG One Rewards points, you can buy them here.
Want to earn more hotel points? Click here to see our complete list of promotions from IHG and the other major hotel chains or use the ‘Hotel Offers’ link in the menu bar at the top of the page.
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