Cashback credit cardby Admin | March 29, 2021
Shop and get cash back: Cashback credit cards make it possible.
1.How does a cashback credit card work?
If you use your credit card to pay for things, you benefit directly: through a cashback at the end of the month, quarter or year if a certain minimum amount is reached, or through an immediate discount on the purchase price. The usual rate is around 0.5 to 2 percent, but there are also outliers on the higher side.
2.What is the difference to other bonus programs?
There are many bonus programs with credit card providers, but unlike cashback, you don't benefit directly from them, but instead earn miles or points every time you use them. In order to get a bonus or reward, you have to wager a certain amount with your card or collect for a corresponding amount of time.
3. Do all cashback credit cards work in the same way?
No. The cards that benefit most are those that give you credit for every dollar you spend, no matter where or what you use it for. Other cards limited their cashback program to certain partner companies or retail chains.
4. What do banks get out of the cashback system?
Customers who have a cashback credit card will logically try to use it as often as possible - even for purchases they would otherwise have paid for in cash or with a debit card. The more that is transacted with the card, the more the card companies earn from it: as a rule, they receive 3 to 5 percent of the purchase amount from the merchants, depending on the contract. They then return a portion of this to the customer through cashback.
5.What should you look out for when purchasing a cashback credit card?
Clearly, before you sign a contract, you should always find out carefully about the conditions and restrictions of the cashback credit card in question.
If the annual price of the card and the cashbacks that are generated add up to a zero-sum game, the whole thing doesn't make sense. Especially not if you end up paying more: For example, if the card costs 100 dollar a year, but you only get 40 dollar back through the cashback system, it's obviously not worth it for you. So make sure that the annual fee is as low as possible. Especially if you choose a credit card with insurance, this can negatively affect the annual fee. Some providers have also capped the amount of possible repayments (in some cases, the limit is already 100 dollar). Overdrawing can be expensive If possible, use the card only for purchases and try not to overdraw the associated credit card account: Credit interest and cash fees are often high, as with other credit cards.
6. Which cashback credit cards are particularly interesting?
There are many providers, we present five of them in more detail (as of June 2017): DKB-Cash: At DKB, there is a free current account with credit card - so there is no annual fee for it. The card is linked to the cashback system. Discounts are available when shopping at many online stores: If you order from online stores such as Amazon or Otto, for example, you get up to 15 percent off as a customer. Targobank Gold Card: The Targobank Gold Card costs 59 dollar a year, but you get 1 percent of the purchase value credited for every payment you make with it. With the partner company Urlaubsplus it is even 5 percent. Positive: There is no maximum cashback amount. GenialCard Hanseatic Bank: With the free credit card from Hanseatic Bank, you receive up to 15 percent cashback at selected online stores (e.g. Expedia, Otto and Sportcheck). If you wish, you can also get the credit card without a checking account. So you can simply continue to use your usual checking account with your house bank. Do you order a lot via Amazon? Then the Visa Card from Amazon could be profitable for you. The advantages: You get 40 dollar start-up credit, which you can redeem directly with your first purchase with the card in the store. In the first year the credit card costs you no fee, from the second year 19.99 dollar. And: With every order you collect Amazon points, which you can redeem again directly with the next order. 1plus Visa Card Santander: If you travel a lot by car, the 1plus Visa Card from Santander Consumer Bank could be worth your while: With this credit card, you get a 1 percent fuel discount worldwide (on a maximum of 400 dollar in fuel sales per month). Since there is no annual fee, it definitely pays off for frequent drivers.