Cash back and rewards credit cards 

Cash back credit cards give you the opportunity to earn money back from purchases.

Portify is not a comparison site - this means that we won’t show you credit card brands. 

How does it work?

Cash back credit cards offer a way to earn while you spend. They work by giving you a percentage of each purchase back in the form of cash back. 

This process is better explained using an example:

If you have a credit card that pays 2% cash back on all purchases and you spend £200 at Tesco, you will earn £4 back.

The actual cashback payout is usually annual however some cards pay cashback monthly.

Is using a cash back credit card a good idea?

Cash back credit cards are a great idea if you are spending money that you would have spent anyways. If you pay your credit card bill off in full each month then considering a cash back credit card would be a good idea.

If you’re unable to pay your bill in full each month then the interest payments can outweigh the rewards amount and end up costing you more.

A word of caution for cash back credit cards

Cash back and rewards credit cards checklist

Make sure there’s no annual fee.
Some cash back cards have annual fees attached to them. Ideally you want one that you can use where you shop most regularly, so make sure the shop where you buy your food takes the cash back credit card you are looking to get eg some smaller shops and retailers don’t accept Amex.

Don't confuse a cash back credit card with a points card. 

A points card is usually only for one store or shop and you can use it in conjunction with a cash back credit card. A shop points card, like a Nectar card, will give you offers whereas a cash back credit card will give you a percentage of what you spend back to you. You can also use a cash back credit card to boost some of these points like avios and nectar. 

Make sure there’s no minimum spend to get rewards on cash back cards. 

Some cards have a minimum spend limit. Make sure that this isn’t the case or that you are comfortable spending over the limit so you can get your rewards.

Don’t borrow on cashback credit cards.
These cards are for getting rewards on your normal spending. You’ll get a better deal by borrowing from a bank or credit card. If you’re looking to borrow check out our ultimate guide to borrowing money.

How to get better rewards and cash back credit cards

If you want better rewards simply put, you’ll probably need a better credit score. 

A better credit score means that you are less risky to lend to. If you’re less risky to lend to you might get better rewards as lenders want to convince you to borrow from them!

Build your credit score to get better rewards

Improving your credit score will unlock opportunities to get better credit cards. Getting better credit card offers means lower interest rates and first-rate rewards offerings.

How to Build Credit the Right Way: Our in-depth guide to credit building.
8 Ways to Build Your Credit Score You Didn’t Know About: Dig into some of the more unconventional ways to give your credit score a lift.
The Electoral Roll and Your Credit Score: Learn how registering to vote can help raise your credit score.

Learn more on credit scores below: