Published: June 10, 2020 | Updated: August 4, 2020 | Posted by: Moneymax | Credit Card
Get paid each time you spend with your credit card—isn’t that enticing enough to get a cash back credit card? But there’s more to credit cards with cashback than just swiping and earning rebates. Understanding how they work allows you to find the one that suits your spending habits and can maximize your spendings. Get started with this guide.
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A cashback credit card, also known as a rebate credit card, is a type of rewards card that earns you cash rebates for every purchase.
These cards make your life simpler because unlike other rewards credit cards, you know exactly how much you’ll be paid back without dealing with complicated point systems.
Apart from its convenience and simplistic rewards system, credit cards with cashback can help you save money, cover some of your expenses, and even build a good credit history.
Cashback credit cards in the Philippines vary not only in their rebate rates but also the ways to earn and redeem some cash back.
If you’re looking for more affordable credit cards with cashback and you frequent Ayala Malls, then you should apply for a BPI Amore Visa card. Aside from the rebates and the low income requirement, you’ll also enjoy exclusive Ayala Mall perks.
Save as much as PHP 12,000 when you use a Citibank Cash Back Credit Card for your grocery runs. Aside from the obvious upside of earning up to 6% cashback, you’ll also save on annual fees on your first year.
If you’re looking to save more during the new normal, then a rebate credit card like EastWest EveryDay Titanium Mastercard will help. With its helpful 5% rebate on essential purchases, you’ll need all the help you can get from soaring prices of goods.
The next time you go out for a quick grub, you’ll be glad to have an HSBC Gold Visa Cash Back in your pocket. Earn 5% cashback on dining expenses and 0.5% on other purchases. Plus, get a PHP 2,500 cash rebate when you apply today until December 31, 2020.
You can also save on overseas purchases when you use a Maybank Platinum Visa abroad. 1% cashback on all purchases isn’t something to scoff at, especially if you travel to other countries frequently. It’s a cashback credit card made for travelers.
If you’re looking to save more on essentials and you happen to have a car, then a Security Bank Complete Cashback Mastercard is the right card for you. Security Bank Cashback Credit Card earns you 4% cashback on fuel expenses. That alone is a sweet deal for every car owner.
Here’s a cashback credit card every motorist will love. With every swipe of a Shell Citi Card, you’ll save more on fuel expenses and other car-related purchases. Since fuel prices are expected to increase in the new normal, a few savings wouldn’t hurt.
Cashback rate: 1.5% on all purchases
Maximum monthly rebate: None
Annual fee: PHP 3,000
Interest rate: 3.50%
Minimum monthly income requirement: PHP 50,000
What sets the UnionBank Platinum Mastercard apart from other credit cards with cashback in the Philippines is its limitless cash rebate program. Every swipe of this rebate credit card will earn you 1.5% cashback, regardless of spend category.
Using one is quite simple. When you shop using a rebate credit card, the issuing bank pays back a percentage—anywhere from 0.20% to 6%—of your monthly purchases into your credit card account.
For instance, if a cashback credit card has 1% rebate, you’ll get PHP 1 for every PHP 100 qualified purchase.
Now it’s time to choose the best cashback credit card out of the bunch. But before you do, it’s important to be aware of the intricacies of credit cards with cashback perks.
Doing so can help you maximize cashback credit cards. Here are some of the factors you should consider before signing up for a rebate credit card.
Cashback cards in the Philippines come in two types with different rebate structures: variable and fixed rates.
These cashback credit cards offer tiered rewards, with different rates for different spending categories. There’s a higher rebate rate for certain categories. So it makes sense to choose a cashback card with the highest rebate for the category you spend most often.
For example, the cashback credit card from Citibank pays back 6% on grocery purchases, 2% on Meralco bill payments, and 0.20% on all other purchases. This makes the Citi Cash Back the best card to use for grocery shopping and paying for electricity bills.
Meanwhile, the HSBC Gold Visa Cash Back pays back a 5% rebate on dining transactions and 0.50% on all other purchases.
For those who use their card to gas up, the Security Bank Complete Cashback Mastercard offers the highest cashback rate of 4% for fuel purchases, as well as 5% on groceries.
Cashback cards with a flat rate are simpler to use than those with variable rates. You earn a fixed rebate percentage on all purchases with your cashback credit card. No need to remember confusing spending categories and double-check them with the issuing bank.
Two of the cashback credit cards that allow cardholders to earn a flat rebate rate are PNB Platinum Mastercard (PHP 1 cash credit per PHP 200 purchase) and UnionBank Platinum Mastercard (1.5% cash rebate on all purchases).
Cashback credit cards aren’t exactly cheap to own. Their annual fees range from PHP 2,500 to PHP 3,500. Most of them charge a 3.50% interest rate, which is on the highest end of credit card interest rates in the Philippines.
So when choosing a cashback credit card, make sure that the savings you’ll get from the rebates offset the high annual fee and interest rate. Consider also the other credit card fees that might cancel out your rewards.
Typically, cash credits earned from spending with cashback cards are credited to the cardholder’s account every month.
The credit card provider may or may not require redemption of cash rebates. For example, Security Bank and EastWest Bank automatically post cash credits to a credit card account, so cardholders don’t need to redeem. On the other hand, Citibank requires redeeming rebates online or via SMS.
If you want a less complicated but equally rewarding credit card, try checking out these credit cards with cashback features. While it’s not as exciting as the other options, a rebate credit card still brings value to the table with their literal money-back guarantee. Imagine getting back a percentage of your spending in today’s economy. That’s already a luxury in itself.
With a goal to help Filipinos lead healthier financial lives, Moneymax regularly publishes tips and tricks on personal finance and lifestyle, among many other topics. For more finance-related news and articles, follow Moneymax on Linkedin.