Our picks of the best cashback credit card offers
These are Money.com.au’s expert picks of the best cashback credit cards in different categories. Be sure to check the full card details, including offer T&Cs, fees and rates, before deciding if any of these cards is right for you.
Top offer for ongoing cashback
BCU Rewards Credit Card This card offers ongoing cashback at a rate of 0.49% for each Australian dollar charged to the card in eligible transactions. There’s a maximum yearly cashback of $500, and cardholders would need to spend approximately $8,500 per month to receive the full amount. Spending roughly $1,500 per month would mean that customers break even on the $89 annual fee.
Top cashback sign up bonus
ANZ Platinum credit card This card offers $450 cashback if you spend $4,500 on eligible purchases in the first four months ($1,125 per month). The annual fee is $0 for the first year, then $87 per year, but the fee is waived for customers who spend over $20k per year. There’s also complimentary insurance options including travel and car rental insurance.
Top offer for converting points to cashback
NAB Rewards Platinum Credit Card With this card you can redeem 12,500 NAB Reward Points for $50 in cashback. The sign up bonus alone (up to 100,000 NAB points) would translate to $400 in cashback if you qualify (min $3,000 spend in the first 90 days). Beyond the intro bonus, cardholders earn 1 point per $1 spent on everyday purchases. The card fee is $195 per year.
Top low fee cashback credit card
CommBank Low Fee Credit Card The sign-up offer is a $240 cashback when you spend at least $500 each month for the first six months. It’s already an inexpensive card at $3 per month, but the fee drops to $0 when the cardholder spends over $300 in that month.
What is a cashback credit card?
Credit cards that offer cashback can be a nice way of getting a more direct benefit from your card. In theory, a cashback operates exactly how it sounds. It's a credit card that rewards customers with money back for spending. But in reality, the cashback almost always comes with strings attached.
In Australia, credit card cashback offers are either an on-going or one-off promotion. Some cards have an ongoing offer where cashback can be earned as a percentage of your regular spending, often up to a limit. Otherwise, the cashback is usually a one-off incentive for new customers signing up for the credit card, usually with a minimum spend requirement.
Only five of the cashback credit cards that Money.com.au analysed (listed above) have the cashback built in as an ongoing feature of the card. All the others (80% of the cards) offer cash back as a one-off incentive.
A similar option to cashback cards are rewards credit cards that offer customers reward points that can be turned into gift cards or converted into cash.
What kind of cashback credit card is best?
To help you decide which cashback credit card (if any) may be best for you, below we explain in detail the different types of cashback credit cards and what they offer.
Credit cards with ongoing cashback
Receive a percentage of your spending returned to your card as cashback. The cashback is an ongoing feature of the card so you continue to get money back while you are using the card. The cashback you get may be capped at a certain $ amount per year.
Credit cards with cashback as a sign up offer
The cashback is a one-off bonus and there is usually a minimum spend requirement in order to be eligible. You'll either get all the cash back in one go or it may be paid out in instalments per month if you meet the spend requirement.
Credit cards offering credits (gift vouchers)
Some cards have rewards that are similar to cash. For example, it might be a card offering a credit or voucher to use at a particular chain of retailers, restaurants or travel providers. This is a common feature on higher end credit cards (e.g. American Express cards).
Credit cards that let you convert points for cash
These cards also don’t offer cashback directly. But if you earn rewards points, chances are you’ll be able to convert those points to gift cards or cash credited to your credit card account (e.g. to help pay off your balance or cover the card's annual fee).
Deciding if a cashback credit card is worth it for you
A cashback credit card might suit if:
- You prefer the simplicity of getting cash into your account instead of rewards points.
- You’ve worked out that cashback is going to be worth more to you than points.
- You’re aware that the cashback offer may be a one-time sign up bonus.
- You’ve checked the other T&Cs and the eligibility criteria (e.g. minimum spend) and are confident you’ll easily qualify for the cashback.
- You pay off your credit card in full every month (otherwise you may want to consider a low rate card).
- You have compared cards and found a cashback credit card that is overall good value and suits your needs.
A cashback credit card may not suit if:
- You’ll need to spend more than you otherwise would to qualify for the cashback.
- You will have a revolving balance on the card. Interest could easily cancel out any cashback you earn.
- You want a card with ongoing rewards (most cashback cards offer cash as a one-off bonus).
- You could get better value from a rewards credit card offering points.
- The card has a high annual fee. The cashback could well be a one off, but the fee won't be.
- Other aspects of the card mean it’s not great value overall (e.g international credit card fees if you spend overseas regularly).
Expert tip: Rewards credit cards are essentially the same as cashback cards
Sean Callery, Editor
If you’re earning credit card points, you essentially have a cashback card. That's because rewards points are redeemable for gift cards, which is as good as cash. Some rewards cards will give you sign up points you can redeem for a few hundred dollars worth of gift cards, and then an ongoing points per dollar which you can cash in when you have enough built up.
Sean Callery, Editor
Nearly half of Australians with a credit card (49%) admit they’ve ‘churned’. That is they’ve signed up for new credit cards specifically to score a welcome bonus, according to new research from Money.com.au. The survey found that ‘churners’ have opened more than two credit cards on average in the past three years.
How will the cashback actually work on my credit card?
Pick a cashback type that suits
Depending on the card, you’ll earn cash either as a sign up bonus, or on an ongoing basis based on how much you spend.
Meet the spend requirement
There are usually minimum spend requirements and/or caps on how much you can earn per year in cashback.
Watch out for excluded spending
Not all spending on your credit card will count towards earning cashback. The likes of cash withdrawals and paying for credit card interest and fees may be excluded.
Cashback is credited to your card
If you meet the spend criteria, the cashback will be credited to your credit card account, either in one amount or monthly as you earn it.
You still need to make the minimum repayment
Even if your credit card account is credited with cashback, this usually doesn't count towards the minimum repayment on your account. You will need to pay that yourself separately.
Be sure to keep up with your repayments
You may not get any cashback if you are behind on your credit card payments.
Are cashback credit cards more expensive?
Cashback credit cards aren’t necessarily more expensive than other types of cards. In fact, a lot of cashback credit cards are relatively simple products. With credit cards, simple often means cheaper.
Money.com.au’s analysis showed cashback credit cards on average have an annual fee of $117, compared to around $155 on average for all credit cards.
Just remember, if the cashback is a one-off bonus for signing up for the card, this may not ultimately be as valuable as a card offering ongoing rewards. Even if that card has a higher fee.
If you're not a big spender, pay off your balance in full every month and want to minimise fees, a credit card with no annual fee is another option to consider.
Pros and Cons of cashback credit cards
Pros
- It’s easy to understand the exact monetary value of rewards, unlike other credit card options where points can be redeemed at varying rates.
- Cashback is a useful and versatile reward. It doesn’t necessitate a specific way to spend the points, which gift cards do.
- Depending on the cashback credit card, it may come with other perks like complimentary insurance services or frequent flyer benefits.
Cons
- Many reward credit cards, including cashback, come with higher interest rates and annual fees than a regular credit card.
- Unlike some other credit card reward options, there is typically a limit to how much a cardholder can earn.
- Cashback is usually dependent on strict conditions, such as a minimum spending amount or shopping in specific locations.
