Money Matters

Reward schemes have proved to be increasingly popular with consumers, from gaining additional points at your weekly supermarket shop to cashback offers from the credit card you use to buy your shopping.

But a new first has happened in the rewards scheme market. Consumers can now accrue points when they buy a new mortgage or insurance policy after Countrywide, the property services group, today launched the industry’s first rewards scheme for mortgage customers.

Customers will automatically accrue points which can be redeemed for rewards or ‘saved’ so they can grow in value at renewal.

Rewards are provided from well-known brands including Champneys, Virgin Wines and Thomas Cook. They range from discount vouchers from leading retailers, 2 for 1 unliminated usage cinema cards and spa days as well as city breaks, free flights and exotic holidays.

This is how the points work:

New mortgage = 1000 points

Contents insurance = 200 points

Building insurance = 200 points

Mortgage Payment Protection = 400 points

Grenville Turner, group chief executive at Countrywide, says:

Over 85 per cent of people in the UK are involved with at least one type of reward scheme and its common place to collect points when grocery shopping, booking flights and purchasing petrol but Countrywide Rewards is the first of its kind in the property industry. This is an exciting and innovative concept for our customers, the property industry, our retail partners and for Countrywide itself.

David Black, banking specialist at Defaqto, says the deal is certainly innovative in the mortgage market. He says:

It is clearly aimed at maximizing the sales of associated products and engendering reward based loyalty. Mortgage brokers have had to learn to widen their repertoire during the last few years in order to bolster reduced income.
 
Many people aren’t really too knowledgeable about how to go about choosing mortgages or indeed the associated insurances and are more than happy to let their adviser sort out everything. For such people the reward scheme is a definite plus.
 
However the quality of insurance policies varies considerably, in terms of extent of cover and exclusions, so the cheapest policy isn’t necessarily the best option.
 

So what do you think – will reward schemes in the mortgage market take off or is it just a gimmick to help increase their mortgage sales?