Woolworths send unsolicited credit card offer to Rewards Card members

Two supporters got in touch with us concerned they’d received an unsolicited offer of an ASB Visa Rewards credit card via Woolworths Everyday Rewards scheme.

The supermarket has partnered with ASB to offer Woolworths Everyday Rewards on ASB Visa Rewards credit cards. If shoppers don’t have the ASB credit card, they could sign up for one to get the points if they meet the bank’s terms and conditions.

We look at whether the rewards are worth it and the problem with unsolicited credit card offers.

Is an ASB rewards card worth it?

ASB Visa Rewards credit card holders who switch to collecting Woolworths points will get 1 point for every $2 spent on their credit card.

Meaning, you’ll have to spend $4,000 on the ASB Visa Rewards credit card to get a $15.00 voucher.

ASB Visa Reward card holders also get 2000 bonus points every 6 months (enough for a $15 voucher).

That $30 “reward” doesn’t cover the $40 annual credit card fee. Plus, if the credit card isn’t paid in full by the due date, it will attract an interest rate of 20.95%.

Card holders also get 2,500 points for signing up to the ASB reward scheme by the end of March – enough for a $15 voucher plus 500 points towards their next one.

Most reward schemes are designed to encourage spending. So, unless you spend a lot on your credit card and pay it off at the end of each month in full, it’s unlikely to be worth it.

A spokesperson for ASB said it had surveyed New Zealanders to see what they wanted from a rewards programme, and 70% said a supermarket rewards scheme “was a positive idea”.

Card holders can also collect double points when they pay for their groceries at Woolworths using the ASB Visa Rewards card and swipe their Everyday Rewards card.

What’s the problem with unsolicited credit card offers?

An offer of a credit card and a $15 voucher at a grocery store could be seen as a solution to family budgets; this sort of lending can quickly get out of control.

Jake Lilley is a senior policy advisor at financial mentoring service FinCap. While he can’t comment on any particular trader’s conduct, in general, he thought the offer of credit card via a grocery store was unhelpful.

“It’s a difficult time financially for a lot of people right now. We’re hearing from financial mentors that food is a strain on the family budget, our food banks are really pushed.”

The cost of food and groceries continues to be a worry, with 74% of respondents to our latest Sentiment Tracker listing it as their biggest financial concern.

Earlier this month, Statistics New Zealand reported that the cost of food has increased 28.1% (up to $300 a week) between 2019 and 2023.

The Salvation Army reported its Ministries had increased its food assistance by almost 40% in 2023 compared to the previous year, in its State of the Nation report (2024).

Lilley said when people get into difficulties with finances, they look for quick solutions.

For existing card holders, it could encourage more credit card spending to get the grocery vouchers.

“If you borrow to eat today, you’re eating into your money to eat next week, and things start to spiral out of control,” Lilley said.

We asked Woolworths to comment on the appropriateness of offering grocery vouchers for credit card spending.

A spokesperson said it emailed Everyday Rewards members to highlight possible benefits by linking the reward cards. It also noted that should Everyday Reward members no longer wish to receive emails, they can unsubscribe.

Rules about issuing credit cards

A bank – and other lenders – must run checks and balances to make sure a person can afford to pay back money borrowed (whether it’s via a loan or a credit card).

If the Woolworths promotion encouraged a person to sign up for an ASB credit card, the bank would have to the exercise care, skill and diligence of a responsible lender. This includes making sure the credit card is suitable and affordable.

It’s not illegal for a bank or lender to send out unsolicited credit card offers. However, a lender can’t up your credit card limit without doing another assessment.

Are supermarket loyalty cards worth it?

We don’t think so. Last year, Consumer analysed the prices of 50 products that had either a Onecard (which has since changed to Everyday Rewards) or Clubcard discount and were also available at Pak’nSave and The Warehouse – both retailers that don’t require a loyalty card to access lower prices.

Prices were collected from Wellington and Auckland supermarkets.

Three-quarters of the time we found items marked with loyalty discounts available for a lower price at one of the retailers that didn't use a loyalty system (read more about misleading loyalty card discounts).

Reward programmes are designed to create loyalty, said Consumer NZ’s head of research and advocacy Gemma Rasmussen.

“They’re trying to create loyal customers and encourage you to shop at the same place, all the time. That’s beneficial for the supermarket and decreases competition.”

We’re also concerned about the privacy policies for supermarket reward programmes.

When customers sign the terms and conditions of a loyalty programme, supermarkets can track a shopper’s habits, and gather personal details.

That data may also be shared with third parties, like advertisers, social media and Google.