How To Redeem Cash Back on Card Earnings?

Cash back reward cards are a great way to earn a little extra money just by using your credit card. Each time you make a purchase, you’ll earn a determined amount of points – usually in the form of a percentage. Say you have a cash back credit card that gives you 2% cash back on every purchase you make. That means, for every $100 on that card, you’ll earn $2 in cash back.

Now, think about how much spending you do in a typical month and over the course of the year: as your spending adds up, so too will the cash back you earn.

Cash back credit cards are a type of reward credit card. Most rewards credit cards give you points for using your card, which can then be redeemed for things like flights, hotels, car rentals, or merchandise when cashing in rewards. Cash back credit cards operate in a similar way, though the rewards you earn are cold hard cash. What’s not to love about that?

There are some things to keep in mind if you’re looking for a cash back credit card, since not all cards are created equal.

Some cash back credit card issuers might put limitations on the amount of cash back you earn (sometimes you earn a set amount up to a certain spending threshold and another amount for any purchases made above that amount). Some restrict how you can redeem your cash back, whether that’s online, in-app, or over the phone, while others set redemption minimums and maximums.

At KOHO, we make the cash back process super simple. There are no limits to the amount of cash back you earn and no minimum or maximum redemptions. There’s a section in the app that allows you to see how much cash back you’ve earned and you can redeem it with just a few taps. And the cash back is deposited right to your spending account, straight away. It’s a super seamless way to get that extra cash, whenever you need it.

Types of cash-back cards

There are several types of cash back cards and they all work a little differently. Here are a few of the different types offered by various financial companies.

Flat-Rate Cash Back Cards:

These cards offer a consistent cash back percentage on all purchases, regardless of the spending category. For example, you might earn 1% cash back on all purchases.

Tiered Cash Back Cards:

Tiered cash back cards offer different cash back percentages for different spending categories. For instance, you may earn 3% cash back on groceries, 2% on gas, and 1% on all other purchases.

No Annual Fee Cash Back Cards:

These cards don’t charge an annual fee, making them a cost-effective way to earn cash back rewards. They typically have lower cash back rates than subscription cards but are a great choice for those who want to avoid annual fees – or want to give cash back rewards a try for the first time.

Premium Cash Back Cards:

Premium cash back cards come with an annual fee but offer supercharged cash back rates, and sometimes additional perks like travel insurance, airport lounge access, no foreign exchange fees, and other benefits.

Student Cash Back Cards:

Designed for students, these cards typically have lower credit requirements and offer cash back rewards tailored to student spending habits, such as discounts on textbooks or dining.

Business Cash Back Cards:

These cards are for business owners and offer cash back rewards on business-related expenses. They may also provide features like expense tracking and employee cards.

Grocery Store or Retailer-Specific Cash Back Cards:

Some credit cards partner with specific grocery stores or retailers, such as Loblaws, Shoppers, and Canadian Tire, offering higher cash back rates when you shop at those locations. These cards are ideal for frequent shoppers at those stores.

Gas Rewards Cards:

Gas rewards cards provide elevated cash back rates for fuel purchases. They may also offer discounts on gas station purchases.

Travel Cash Back Cards:

These cards allow you to earn cash back that can be used towards travel expenses. They may offer higher cash back rates on travel-related purchases like flights, hotels, and car rentals.

Secured Cash Back Cards:

Secured cash back cards are designed for individuals with limited or poor credit histories. They require a security deposit, but they can help rebuild credit while earning cash back rewards.

How to redeem cash back

Each card has its own way of redeeming points and, as mentioned, KOHO’s cash back cards make it super easy when cashing out credit card rewards.

Here’s how you do it.

• Open your KOHO app

• At the top of the app, you’ll see your balance

• About half-way down the page, you’ll see the Cash back section

• Tap that

• There, you’ll see how much cash back you’ve earned

• You’ll also see your all-time cash back total

• You can check your current cash back rate

• And you can even switch tiers to customize the cash back you can earn

Once you tap “redeem” in the cash back page, your cash back will be deposited to your Spendable account in just a few seconds. In our humble opinion, it’s one of the easiest ways to earn cash back rewards and redeem and spend them!

Is it better to use points or get cash back?

Lucky for you, we’ve got a handy guide to help you decide which is better for you, a points card or a cash back credit card.

Want the brief synopsis?

Rewards cards offer points or miles for specific purchases and are suitable for frequent travelers, while cash back cards provide a percentage of money back on all purchases and are more versatile for various spending needs. You’ll want to take a look at your spending habits – and what you hope to use your points or cash back for – and choose the card that’s right for you.

Where does cash back go when redeemed?

Cash back rewards can be redeemed for cash that’s deposited right to your account or for statement credits, or online shopping credits. After earning rewards with purchases, it’s up to you how you’ll use your cash back.