What is cash-back?
Cash-back typically means a type of financial transaction that is related to credit and debit cards. Cash-back incentives have grown increasingly popular in the past two decades. Very often, its the credit card benefits that actually refund the cardholders a small amount of what is spent on every purchase or each purchase that is above a certain amount threshold. It also describes a debit card transaction during a purchase where the cardholders can actually receive cash at that time.
Basics of Cashback
Let us talk about the basics of cash-back. It is a program of general rewards that are offered by the credit card issuers. The cash-back program becomes universal in today’s world where nearly all credit card or debit card issuers now offer these features on at least one of its products. It is basically like an incentive program for existing costumes to keep them happy and satisfied. This is done so that they can use the cards more often while making purchases. It is also used to attract new clients or to switch clients from a competitor.
Cash-back rewards are literally cash, as the name suggests. Therefore, it is completely unlike the typical rewards that are in the form of points that can be used to buy goods and services using the points or the gift cards, provided by the card issuer. Customers can either use these cash-back rewards to pay the monthly credit card bills that come along with the purchases on the card statement. Or, customers can also simply receive the cash-back reward directly. Cash is either deposited into the linked account of the credit cardholder or it may be sent through the mail.
Cash-back Rewards for Credit Card Holders
Usually, it is said that the credit card holder must reach a certain transaction amount to be eligible for the said cash-back reward or any other benefits. It may be as small an amount as $25 but it may vary from card to card. Many credit or debit card companies let you cash in the rewards that can be used towards certain specific purchases. These companies usually have a partnership with those companies as an incentive program.
It may happen that with some of the credit and debit cards, the customer could get an opportunity to receive the cash in the form of immediate cash-back in places like the supermarket or any such similar locations. The customer can ask the concerned merchant to add an extra amount to the rate of the purchase, then he/she can receive this extra amount in cash in hand. Therefore, it is always a good practice to check the cash-back on your credit or debit cards before making a purchase. It will be easier as you may already have a cash reward or other incentives pending.
