With cash back credit cards, you can earn cash rewards for making purchases. Cash rewards or cash back is an option available to retail credit card holders and it is like earning money back by spending. Usually, credit card companies offer cash back benefits to entice people spend more. You get paid when you use your cash to buy something.
Different credit card companies offer different cash back cards with varied features, and terms and conditions. Some cards offer the same amount of cash back return for all purchases while others offer higher cash back amount on spending higher amounts. Again, some credit cards offer higher cash back benefits at select merchants or some others offer higher cash backs for purchasing select items. For example, you can get cash back for purchasing movie tickets at select cinemas for using a particular credit card.
How cashback operates
There are three ways the cashback feature of a credit card works - general cashback program that enables customers to earn points which can be used to make purchases at selected merchants; cash back programs with programs that enable you to earn air miles when you spend with your card, and there are some programs that give you direct cashback benefits, and a percentage of the total spend you make with your card gets credited to your account.
There are lot of cash back credit cards available in the UAE financial market. Given that you have so many cash back cards to choose from, how do you choose the best cash credit card suitable for your requirements? So, before choosing a cash back credit card you need to know what your requirement is and then proceed to choose a card. Once you decide to opt for a cash back credit card, you need to look into the following factors. Listed below are some of the key things you need to consider while choosing a cash back credit card:
- % of Cashback offered:
Even if a credit card comes with cash back benefits, you need to check how much % is offered as cash back and where you avail these benefits.
- Annual fees and other charges:
You also need to check whether the card charges annual fees or not. Read the fine print to know the hidden charges involved in your credit card, if any.
- Check out other benefits:
Apart from cash back benefits, check out what other benefits are available on your credit card. Find out whether you card offer lifestyle benefits, free valet services and airport lounge access and other benefits. Because, cashback is only one aspect of your credit card.
- Where cashback is applicable:
Always go for a card that offers cash on all purchases. Because a 5% cashback on all purchases would definitely provide you more value that a 10% cash back on dining out. Certain cash back credit cards are accepted in a wide range of outlets starting from petrol depots to supermarkets and fashion shops. Also, certain cards offer cash backs on education fees and utility bills. So, understand your requirement and then decide which card you would go for.
- Shop around and compare:
You can shop around and compare various cash back credit cards available in the market. This will help you choose the best for you.
- Co-branded cards:
Co-branded credit cards can be good choice if you want to enjoy privileges such as additional rewards, airport lounge access, complimentary hotel upgrade and many other concierge services on your travel bookings.
It’s available only those people should apply for cash back credit cards who can actually pay off their credit card balance on time and in full. Otherwise, you will end up losing your rewards and paying heavy penalties.
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