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Compare cashback credit cards

Cashback credit cards reward customers with money back on their spending. This flexibility may help pay for fees or be used for other purchases. Compare cash back credit cards today.

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What is a cashback credit card?

A cashback credit card rewards customers with cash when they make eligible purchases, or when they sign up as an introductory offer. These incentives can help attract new customers, who may find cashback offers helpful for getting a little back on their spending.

The cash may be earned either directly from your spending, or indirectly via redeeming rewards points, depending on the issuer’s terms and conditions. You may be offered cashback as money in your account, gift cards, or even vouchers for spending at participating retailers. 

Some credit card issuers may cap the dollar amount of cashbacks a cardholder may earn. You may also need to meet certain conditions to qualify for your cash back offer, including minimum spending limits each month.

What types of cashback credit card offers are there?

There are three main types of cashback offers:

  1. Cashback on purchases: When you make an eligible purchase with your credit card, your provider may offer a percentage of that purchase back as cash, typically capped at a set dollar figure each month. Eligible purchases could include shopping at affiliated retailers, or it could be using your car for more general spending (though there are often exemptions, such as using your credit card for gambling).

  2. Sign-up cashback: Much like a reward points sign up bonus, a credit card provider may also have a promotional cashback offer for new customers upon sign up. You may need to meet some criteria to be eligible for the cashback offer, such as meeting spending minimums within the first few months.

  3. Reward points: If your credit card is connected to a rewards program, you may be able to redeem your points for cashback, such as gift cards for affiliated retail stores or even funds credited to your account.

How do cashback credit cards work?

There are four main ways to get cash back on a credit card:

  1. On regular purchases every month: You may get back a percentage amount of your spending, generally capped at a set dollar figure each month.

  2. On eligible purchases: Typically through retailers affiliated with the card provider, such as Woolworths, Kmart or even Qantas.

  3. As an introductory offer: A card provider may only offer cash back on purchases over a set period of time, such as the first few months.

  4. Through rewards points: You may be able to exchange your rewards points for cash from your card provider.

What is the difference between a rewards credit card and a cashback credit card?

A cashback offer is typically just that - a percentage of your purchase is credited back to your account, or you’re offered cash or gift cards on sign up. 

However, a rewards program lets cardholders exchange points for various rewards, like electronics, appliances, flight upgrades and hotel accommodation, and potentially also cashback. These types of credit cards encourage cardholder spending and typically come with higher ongoing costs.

The benefits of cashback credit cards

Credit card cash back rewards let you earn cash on your everyday purchases, or cash in your reward points for vouchers or credit. 

The most obvious perk to this type of credit card is that you’re getting a bit of money back on your spending. Having a little extra cash each month could help to offset the cost of your credit card bill, as well as ongoing fees and charges.

Traditional rewards programs generally let cardholders choose products or services from a set catalogue of items. You may also be able to redeem rewards points for cashback, giving you the flexibility to use the points for everyday spending with any retailer you choose, rather than being limited to retailers participating in the rewards program.

What are the limitations of cashback credit cards?

While cashback credit cards do offer generous perks and rewards to customers, there may be some limitations worth keeping in mind, including:

  • Cashback caps: Cardholders may be limited to earning a certain amount of cashback on an ongoing basis. This may be a dollar value, such as $200 a month, or capped as a percentage of your spending.

  • Interest: As a type of rewards card, cashback credit cards may charge average to high interest rates. And as this type of card encourages spending, it’s recommended cardholders prioritise paying their balance in full each statement period to avoid interest charges.

  • Fees: Just like with any other rewards card, cashback credit cards may come with average to high annual fees. You may want to ensure that you’re earning enough back from your spending through cashback rewards to justify the ongoing fees.

Which spending profile may suit a cashback credit card?

Cashback credit cards aren’t for everyone, especially as they typically come with strict criteria around how to earn your cashback. 

A cashback credit card may suit the way some big/everyday spenders use their credit cards. If you plan on using your cashback credit card regularly, such as for your weekly grocery trip, you may be able to meet the potential conditions involved.

This card type may suit habitual spenders, but as it is considered a type of rewards credit card, cashback credit cards may come with higher purchase rates and annual fees. The added cost this may create could outweigh the benefits of earning cash back, as habitual spenders are less likely to pay their full credit card balance on time.

If you’re an impulse/occasional spender and only use your credit card for big one-off purchases, or even just for travel, then you may not enjoy as much value from the cashback rewards compared to the cost of the fees and charges.

Case study: Alison the everyday spender

Alison loves using her credit card to earn frequent flyer points, but she’s looking for new ways to earn points beyond buying plane tickets. As Alison is saving for a property, she decides that earning cash back on her regular spending may be the best way to use her rewards credit card. 

Alison hops online and searches for cashback credit cards. After finding RateCity, she uses the filters in the comparison table to enter in her details and narrow down her preferences.  

Alison always pays her card balance on time, so she opts to sort her results via annual fee as this is generally her biggest ongoing cost with her credit card. She is then able to make a handy shortlist of cashback credit cards. 


How to compare cashback credit cards

Cashback is just one feature attached to a credit card. When you’re comparing credit cards, it’s important that you take all the other features, benefits, fees and charges into consideration to find a credit card that offers the most value for your financial situation.

Another factor to consider is the interest rate. Rewards cards tend to have higher purchase rates than standard cards, which is something to consider if you don’t manage to pay off your card balance monthly. Pay attention to any annual card fees. In some cases, the annual card fee can be more than the cash back, so do your sums to make sure it’s worth it. If you’re a big spender, check to see whether there are any caps on the number of points you can earn or redeem.

If managed carefully, credit cards with rewards programs can let you cash in on your spending. But as these cards tend to have higher fees and interest rates than other standard credit cards, they can potentially cost you more if you don’t manage your money carefully. If you tend to only pay off the minimum amount each month, you may want to also compare a low-rate credit card or a card that offers interest-free days.

Before deciding, make sure you compare your options to find a cash back credit card that suits your spending habits.

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^Words such as "top", "best", "cheapest" or "lowest" are not a recommendation or rating of products. This page compares a range of products from selected providers and not all products or providers are included in the comparison. There is no such thing as a 'one- size-fits-all' financial product. The best loan, credit card, superannuation account or bank account for you might not be the best choice for someone else. Before selecting any financial product you should read the fine print carefully, including the product disclosure statement, target market determination fact sheet or terms and conditions document and obtain professional financial advice on whether a product is right for you and your finances.