Having a cash back credit card ben be a good option if you use your card quite often. These cards are very popular around the world today. There are quite a few of them available in India, so you’ll need to choose wisely. Study the offers to see which truly has the best terms. Then, compare them to the leading cash back cards throughout the world to see what you should expect from this type of financial service.
Meanwhile, remember that all cards have some fees and disadvantages. Therefore, you need to be aware of them before you take on more debt than you can handle.
What Is a Cash Back Credit Card and What Features You Should Look For in It?
In essence, a cash back credit card pays you for using it. These cards will reward you with points that can be redeemed as cash or other benefits at a specified time. The amount of the reward varies greatly. Many cards will only offer cash back for several categories of purchases. There are also some that have a limited list of eligible places to shop.
However, despite these limitations, this type of credit card benefit can be very useful. After all, you are going to make all those purchases anyway. So why shouldn’t you be paid for them, right? In particular, cards that offer benefits for travel expenses can help you earn more for your vacation through everyday purchases.
While the benefits of having a cash back credit card cannot be denied, you need to remember that these cards should be used responsibly. Also, You’ll need to use it quite frequently to make all associated fees and interest rates worth it.
Top Cash Back Credit Card Options Worldwide
Cash back credit cards in America are some of the best worldwide. They are extremely versatile, so customers can use several cards to accumulate significant rewards over time. Many of them are also extremely flexible in their reward systems. Therefore, it can be possible to find a card that will give you good cash back on all purchases. Depending on the card you might get up to 6% of your money back.
The best option in the US currently is the Citi Double Cash Card. It gives the user an unlimited 2% cash back reward on all purchases (1% when you buy and 1% when you pay). This isn’t the highest possible return, but it extends to every purchase you make with the card.
Some of the other leading US cash back credit card offers are:
- Chase Freedom Unlimited: 1.5% cash back on all purchases, 3% on restaurants, and 5% on travel with no annual fee.
- Capital One Quicksilver Credit Card: 1.5% cash back on all purchases daily and no annual fee.
- American Express Blue Cash Every Day: 3% on purchases in US supermarkets (up to $6,000 a year) and 2% cash back at gas stations and select department stores in the US.
There are quite a few great offers when it comes to cash back credit cards in Canada. Customers there have their pick of free cards, so they get to skip the annual fee entirely. They also get a hefty cash back on everyday purchases. In addition, some more specialized cards offer great benefits for specific expenses, like travel.
The best cash back credit card in Canada at the moment is the Rogers World Elite Mastercard. It offers 4% cashback for eligible purchases in foreign currencies, which is unlimited. There is also an unlimited 2% reward for all Rogers™ purchases and 1.75% for all other eligible purchases. Considering how wide the list of “eligible purchases” is, one can get cash back on the majority of everyday expenses. Moreover, the card has no annual fee and the owner can redeem their cash back rewards towards various purchases instantly.
Other prominent cash back credit card options in Canada include:
- Tangerine Money-Back Credit Card: 2% cash back for purchases in up to three categories and no annual fee.
- Capital One Aspire Platinum Mastercard:1% cash back on all purchases and insurance benefits.
- American Express SimplyCash Card: 5% cash back on gas, grocery, and restaurant purchases for six months and 1.25% cash back on all purchases.
Surprisingly, it’s hard to find a flexible cash back credit card in the UK. The majority of them have monthly fees and only offer cash benefits for a few categories.
The best option now is the Santander All-in-One Credit Card Mastercard. It offers a 0.5% cash back on all purchases and has a £3 monthly fee.
Top alternative cash back credit cards in the UK are:
- AIB Visa Option 1: 0.50% cash back on spending over £5,000 a year.
- Smile Classic Credit Card Visa: 0.25% cash back if you spend over £1 a month.
- American Express Platinum Cash Back Everyday Card: 5% cash back for 3 months up to £100 and 0.50% on spending between £1,000-5,000 a year or 1% cash back when spending over £5,000 a year.
The Best Cash Back Credit Card in India Today
As a rule, a cash back credit card in India will have an annual fee of Rs.500 or up to Rs.1000. Also, reward points on these cards are earned only through a limited number of purchases.
Right now, the best option for varied purchases is the HDFC Bank Moneyback Card. It offers 4 cash back points for every Rs.150 on online purchases and 2 points for every Rs.150 for other types of purchases. You also get 500 points as a joining bonus. You can redeem rewards points for cash.
If you spend your money mostly online, you should consider the benefits of the HSBC Cash Back Credit Card. It offers a 5% cash back on all online purchases and 1% for all others. The cash back is unlimited but the card’s annual fee is Rs.750. You can also get discounts in select restaurants.
If you are looking for a cash back credit card that offers rewards for specific categories of purchases, the Citi Cash Back Credit Card will be a good choice. It has the annual fee of Rs.500 and 5% cash back on telephone, utility bills, and movie tickets. There is also a 0.5% cash back on purchases in other categories.
In India you can also find multiple credit card options that offer cash back rewards for fuel, restaurants, and some travel expenses.
Is a Cash Back Credit Card in India Equal to Its Global Counterparts?
The banking industry in India is developing and some of the offers here are now on par with the leading developed economies. However, no cash back credit card you can get in India quite matches the benefits you would get for it in the US, the UK, or Canada.
In the majority of cases, Indian cards only offer cashback on a limited variety of purchases. They also have an annual fee and a rather high APR.
It’s common for a cash back credit card to offer less money through cash back then you would pay in interest if you don’t pay off the card completely every month. However, this disparity is higher for Indian cards. Therefore, you should use this type of financial benefit only if you are sure you can keep up with your credit card payments. Considering various fees associated with a credit card, it makes more financial sense to get one if you are going to use it often. Otherwise you might lose money on it due to rather high annual fees.