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Is it worth paying a surcharge at ALDI to earn frequent flyer points?


Free flights or cheaper groceries? We've crunched the numbers.

ALDI's cheaper grocery prices come with a sting: if you pay by credit card, you have to pay a 0.5% surcharge.

"There are very high costs associated with accepting these cards," the supermarket giant's site explains. "Rather than ALDI inflating prices across the board to compensate for the credit card acceptance costs (like most of the retailers do) ALDI instead allows customers to make the choice as to the payment method they prefer."

Under Australian law, companies can legally pass on credit charge surcharges, but can't charge you more than the actual cost of providing that service.

Avoiding the surcharge is easy. Just pay with an EFTPOS card, or use cash. (Note that contactless will attract the surcharge, so make sure you swipe your debit card.)

But if you're using a frequent flyer credit card, is it worth paying with a card (and paying the surcharge) just to earn some more points?

How many points could you earn on your ALDI shop?

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Using a credit card at ALDI can be convenient and earn points, but it will cost you more. Image: Angus Kidman/Finder

Let's consider an example. This one is about Qantas, but the calculations are basically the same for Velocity.

The average Australian spends $185 a week on groceries, Finder research shows.

A 0.5% surcharge on that amount comes to 93 cents.

How many points you'd earn for that spend depends on your card.

A card earning 1 Qantas Point per $1 spent, such as the Qantas Premier Platinum, would earn 185 points.

That means each 1 Qantas Point is costing you around 0.5 cents.

Our current calculations on how much points are worth shows that 1 Qantas Point can be worth anywhere between 0.3 cents and 8 cents.

If you spend those points on a reward flight, each one will be worth at least 1.3 cents - so you'd be ahead even after paying the surcharge.

But if you use the points for a gift card, you'll have paid more for them then you've redeemed in value.

If your card earns Qantas Points at a lower rate, the outcome is even poorer.

My conclusion? If you have a card earning 1 Qantas Point per $1 spent and you know you'll spend the points on rewards or upgrades, you'll likely come out ahead even after paying the ALDI surcharge. But if that's not the case, you're probably better off using another payment method at ALDI.

One other point: ALDI doesn't accept American Express, so you can't earn points on your Amex card while shopping there.

And also don't forget: Vegemite isn't any cheaper at ALDI.

Want to keep your frequent flyer points balance growing? Check out the latest credit card sign-up deals.

Image: Finder/Photographer: Angus Kidman
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