When using a credit card, we are often applied with a refund policy, also known as cashback. So what is a cashback credit card? What are the advantages of using Cashback card? Which bank’s Cashback card should I use?
All will be summarized in this article.
Table of Contents
What is cashback?
Cashback is a form of incentive that the Bank exclusively gives customers using credit cards. Thereby, when customers make purchases and use credit cards to pay, a part of the money will be refunded directly to the card based on the invoice value.
This cashback model originated in the US, then spread to the UK and other countries. Applied by many banks to create competitive advantage and stimulate shopping demand.
See also: What is Digital Banking? List of Digital Banks in Philippines.
What is a cashback credit card?
Cashback credit cards are credit cards provided by the Bank that apply cashback programs when using the card to pay utility bills and make purchases.
Customers using a Cashback credit card when making payment will receive a refund, or more easily, a discount on product purchases, the discount amount is added directly to the credit card account. The amount refunded when using the Cashback card is calculated as % of the total order value when you use the card to pay. This percentage is high or low depending on the service you use.
For example: You use a cash-back credit card of a bank with a refund value of 5% of the total bill, when you shop with a total invoice value of 5,000 PHP, the amount you will be refunded by the bank. back to your credit card is 0.05*5,000 = 250 PHP.
Advantages of using a cashback credit card
Cashback credit cards are not only beneficial to customers but also a strategic card for card issuers.
Benefits of the bank when issuing cashback cards
Cashback card is a strategic card to create a direct competitive advantage with other card issuers. When all banks have cashback cards, the percentage of refund will be the main factor that determines the choice of customers.
With cashback programs offered by cashback cards, customers will often use the card to shop and pay bills, thereby increasing the Bank’s revenue.
Advantages of using cashback card for customers
The cashback program along with the points accumulation program is a way to help customers save a large amount of money when spending and shopping with credit cards.
3 Outstanding cashback programs when using Cashback credit cards:
- Refund when paying for insurance services
- Cashback in the field of education
- Cashback on shopping
Refund when paying for insurance services
For example, VPBank credit cards get up to 6% cashback when paying for Manulife insurance. This policy helps customers benefit and reduce the cost of their insurance package
Cashback in the field of education
For those with school-age children, this is an attractive feature. Every month you pay for your child’s school fees, you will get a certain amount of money back. However, only schools that have Pos or online payment gateways can enjoy this offer.
Cashback on shopping
All major banks today such as HSBC, Metrobank, BDO…have a cashback feature when shopping. However, this feature will be limited to the maximum amount of cashback in a month
Besides the cashback program, customers using cashback cards will have more incentives than regular customers through the Bank’s stimulus programs.
Which bank’s cashback credit card should I use?
- Citi Cash Back Card.
- HSBC Gold Visa Cash Back.
- BPI Amore Visa.
- Maybank Platinum Visa.
- EastWest EveryDay Titanium Mastercard.
- Shell Citi Card.
- Security Bank Complete Cashback Mastercard.
- UnionBank Platinum Mastercard.
The fastest way to open a cashback credit card
- Citi Cash Back Card.
- HSBC Gold Visa Cash Back.
- BPI Amore Visa.
- Maybank Platinum Visa.
- EastWest EveryDay Titanium Mastercard.
- Shell Citi Card.
- Security Bank Complete Cashback Mastercard.
- UnionBank Platinum Mastercard.
Procedure to open a cashback credit card
Prepare ID card
Permanent residence book or driver’s license.
Labor contract/Salary statement or Confirmation of quantity.
Some other types of documents at the request of each bank.
Cashback credit card opening process
Step 1: Prepare documents as required by each bank.
Step 2: Bank staff guide customers to fill in all information in the card opening registration form.
Step 3: After completing the procedure, the bank staff will schedule a date to receive the card.
Step 4: Customers can go to the bank to receive the card after 10 to 15 days.
Conclusion
Through the above article, we can see the advantages that cashback credit cards bring as well as answer the question of what is cashback? Hope the article will give you the right advice and choices when opening a credit card.
See also: What is E-wallet? Top 10 best E-wallets in the Philippines market today
