Businesses know how valuable customer loyalty is; thus, they offer different perks and rewards. One of the most popular among them is cashback rewards.
A cashback reward is a form of incentive offered by the bank or retailer issued to the cardholder’s account. Cashback reward is usually a small portion or percentage of the entire amount spent. The cashback may be awarded in the form of credit, gift cards, check, and cash.
A cashback is always something that many consumers are looking forward to. Cashbacks are not only beneficial for consumers but also have numerous advantages for businesses. Cashbacks exist to promote a business further and encourage more consumers to patronize their brand.
Usually, businesses can offer you several ways to earn cashback. The most common way to get cashback is through credit cards. The idea here is that consumers need to spend using their credit cards to partner brands and retailers that offer cashback rewards under certain terms & conditions.
To give you an idea of what advantages you get from cashback rewards, read the rest of this post.
1. Earn Cash Returns
The cashback or cash returns you receive is probably the most important benefit you get from cashback rewards from the name itself. For example, a credit card has a guaranteed cash return of 1% or AUD 1 for every AUD 100 you spent. But this is just the minimum amount. Other cashback programs can go up to 5%, depending on the type of credit cards and retailers.
2. Easier to Earn Than Rewards Points
Cashbacks are easier to earn and redeem even if you’re thrifty with your spending. Most cashbacks are available even if you spend less on your purchases. On the other hand, Rewards points require you to purchase more to accumulate a certain number of redeemable points for a designated gift. Frequently, these gifts are not entirely necessary for an average consumer. Whereas a cashback, you can purchase it for anything you want.
3. Earn Rewards Points Simultaneously
Furthermore, there are cashback cards out there that also offer rewards points. The rewards points that you accumulated can be redeemed for future spending or earn generous discounts from partner brands and retailers.
4. Earn Cashback Through Debit Cards
When you’re fond of using your savings account for your spending, you will get cash rebates from your debit card. The only downside with this is you’re using your money out of your savings account. But, most cashback programs require no criteria to be followed for you to earn cashback. All you need is to use your debit card for your spending, and the cashback will be credited instantly to your account.
5. Extra Perks and Rewards
Some cards will give you a discounted price as part of the perks you get. Some instances provide you with better cash back. But, these perks and rewards are exclusive to particular categories. So, it would be best if you did a little research to take advantage of this.
6. Sign-up Bonus
Using a cashback card usually provides you with a sign-up bonus. It is in the form of a higher return upon spending that is only limited for a certain period. In some instances, the sign-up bonus comes in the form of a waived annual fees in your first year. Or, these can be vouchers that you can redeem at partner retailers and brands.
Before diving into a shopping splurge, make sure you do some research to help you earn more cashback than racking up on debt. Remember that paying interest can easily negate your cash back rewards and affect your Annual Percentage Rate (APR).