Cash Back Credit Cards – How They Work

Cash back credit cards offer cash rewards or cash rebates to be earned when purchases are made with that particular credit card. You may be interested to know how it is that credit card companies can afford to pay cash back. Here are the two main ways that allow them to do so:

Annual Fees

An annual fee of varying amounts anywhere from $30 to $100 dollars is charged once a year to assist the company in offering the cash back rewards.

Processing Fees

When you purchase an item at your local grocery store, the retailer is charged a small fee that goes towards your cash rewards and other credit card related fees.

The standard cash reward is one percent (1%) for all purchases made with your credit card. There are numerous cards that offer cash rewards, below is three of the top recommended cash back credit cards on the Internet:

#1 Chase Freedom Cash Visa Signature Card
This card allows you to choose between reward points or a cash back reward. It offers a 0% APR for up to 6 months with a standard APR of 18.24%. There is no annual fee included with this card.
#2 Blue Cash Card From American Express – Cash Back
This card offers a 0% APR for 6 months and a standard APR of 13.24%. This card offers cash back rewards and no annual fee. A 5% cash back rebate is earned with purchases.
#3 Discover More Card – Cash Back
A 5% cash reward is earned with card purchases. There is a 0% APR for the first year and a standard APR of 10.99%

There are several other cards available with cash back rewards. It is best to review the entire details of a rewards card prior to applying. You can view these details online. You can search by specific card type or by using the key words cash back credit cards. Understanding all of the details of your credit card prior to application is key to receiving a suitable and satisfactory card.

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