What Is a Cashback Credit Card?
When you spend with a credit card, one that gives you a percentage of it back would be classified as a cashback credit card. How would you get the money back? It is usually in the form of discounts or rebates.
How Do Cashback Credit Cards Work?
Most cashback credit cards offer between 1%-10% of cashbacks in different categories of spending, such as general spend, retail spend and utility bills. Cashback credit cards that have partnerships with certain retail or travel brands usually offer higher rebate rates with their retail partners. Another area which has one of the highest rebate rates is petrol, with some cards offering up to impressive rates of 20%!
To get an idea of how it works, here is a short and simple example. Say a cashback credit card offers a 5% rebate on general spending. If you spend $1,000 per month, you would get $50 back.
However, it is worth noting that most cashback credit cards do have some limits and requirements set in place.
Here are some of the best features and main benefits of certain credit cards, which you should not miss out on!
- Unlimited Cashback
Some cashback credit cards offer unlimited cashbacks with no cap at all on the amount of rebates! This is particularly suitable for the affluent, who may have high spending budgets every month. Having unlimited cashback allows you to maximize your rebates and rewards for every budget, including high budgets.
- No Annual Fee
Many cashback credit cards do impose an annual fee for their outstanding privileges and rebates which cardholders get to enjoy. However, if you are on the lookout for a cashback credit card which does not require you to fork out more from your pocket, fret not, as there are still cashback credit cards which offer the same rebates and privileges with waived annual fees.
- Spend Categories
When choosing the most suitable cashback credit card for yourself, do keep in mind the areas which you usually spend most on. It would be handy if you have an expenditure tracking sheet from the past few months for you to take reference from.
You may be wondering – why would I need this? Well, that is because most cashback credit cards have targeted areas of focus when it comes to the rebates and discounts they offer.
For example, the HSBC Visa Platinum card offers cashback on daily family spending, such as dining, groceries and fuel. So, families with higher expenses on food and petrol would find this card suitable for them.
On the other hand, the CIMB World MasterCard offers more rebates on entertainment and leisure, such as duty free shopping and golf perks. This would be more suitable for avid travelers.
Applying for a New Cashback Credit Card?
If you want to apply for a new cashback credit card but are not sure not sure which one is the best one on offer right now, you might want to check out an analysts’ summary of some of their top picks for cashback credit cards!
We understand that different customers have different needs, such as a varying amount of monthly spend, versatility, ease of use and specific spending sectors. Save the trouble of having to perform confusing calculations on your net returned value, as our analysts have already accounted for all the rebates and annual fees involved after scouring through more than 1000 pages of credit cards and their terms.