Credit Card Questions & Answers

How does a tiered cash back scheme work?
A tiered cash back scheme works by offering different percentages of cash back for different levels of spending.

Often, a tiered scheme will use a 12-month period to record levels of spending, when a new tier is reached in that 12-month period the new percentage of cash back will then be awarded on any further spending, and then again when another spending level is reached in the same 12-month period.

While tiered schemes can work backwards (offering less cash back the more you spend) most will offer more cash back on higher levels of spending.

Tiered cash back credit cards are generally best suited to high credit spenders who will reach the higher payout tiers quickly.

Which is the highest paying cash back credit card?
The percentage of cash back offered does vary between credit cards and can be limited to a certain amount each month. Many cash back credit cards also offer higher rates of cash back for an introductory period – usually around 2 to 3 months.

The amount of cash back you earn on a credit card can therefore be more variant on how much you spend than the actual written percentage.

Currently, the highest rate of cash back available on a credit card is 5% - but this is during an introductory offer. For the rest of the time the highest available rate is 1.5%.

When and how will I receive the cash back I've earned?
Cash back credit cards vary their means of when and how they make the reward payment. Usually cash back will be paid to the cardholder as a credit to their account or sometimes as a personal cheque.

Cash back payments can be made at the time of transaction in the case of cash back with select retailers, monthly, quarterly or annually.

Instant and monthly cash back payments tend to be as an account credit, whereas annual payments can be either as an account credit or as a personal cheque.

Why is it important to repay my spending in full when earning cash back?
Primarily because any interest charged - even on the lowest rate credit cards - will outweigh the financial gains of earning cash back.