Before the plastics, i.e., the cards, money had ruled the market. In the year 1980, The Central Bank of India launched its first Credit Card of Visa brand, and thus, the Indian society was introduced to the concept of credit cards. Ever since credit cards have come a long way in terms of their functionality and offerings to the customers. Today, customers with a credit card are offered various schemes.
Cashbacks and Reward Points are 2 aspects of a credit card that banks are leveraging on. Depending upon the transaction size and type of purchase through a credit card, banks offer reward points to customers. These points can be availed in the form of cashback, vouchers, discounts, etc., on the next purchase.
In a nutshell, Cashbacks and Reward Points are incentive programs for the customers where a percentage of the amount spent is paid back to the cardholder. It is a rebate from the current purchase that can be applied as a discount on the next purchase. To make the most of the scheme, it is imperative customers know handy ways to maximize cashback through credit cards.
5 handy points to remember-
- The Right Card- There are numerous options of credit cards in the market, single or co-branded, and it is vital to choose the card that offers you the best interest rates, offers, reward policy, etc. Financial Institutions offer co-branded credit cards, for eg: Flipkart and Axis Bank offer a co-branded credit card with unlimited cashback. Co-branded cards can fetch reward points which may be as much as 5 to 10 times higher as compared to most other cards. Hence, choosing your card wisely is necessary.
- Monthly Bills & Big Purchases- Choose a card that offers an array of options and fetches you points or cashback while paying your monthly bills and everyday expenses. Paying bills through a credit card in stores, petrol pumps, airlines, etc can fetch you a considerable amount of cashback. For eg: If you make a monthly purchase of Rs 5,000 and receive a 2% cashback, i.e., Rs 100 per month, by the end of the year, the total will amount to Rs 1,200. It is a good amount to add to your savings year on year. Similarly, paying through credit cards for high-value purchases results in higher returns.
- Festivity Rewards- Follow and keep an eye on limited period offers that are often seasonal. For eg: During Diwali, through cards, banks offer an array of services, products, cashback options, etc., that one may not find on other days. Seasonal cashback is higher than usual and hence, is highly recommended.
- Adjust on Pending Cashback- Cashback and Reward Points often lapse after a certain period and hence, it is advisable to keep an eye on the dates and utilize the points accordingly to take advantage of various benefits.
- Multiple Credit Cards- Having multiple cards ensure more benefits as multiple banks partner with a single service provider. These service providers may offer different services, offers, rewards, etc., to each bank and hence, having multiple cards allows you to leverage benefits of your choice. Furthermore, having multiple credit cards also helps you to Improve your Cibil Score.
With a little time spent towards strategizing your expenditure, one can rack in more cashback and reward points than ever!