Cashback shopping in simple words you get a percentage of the amount spent is paid back by the company.
What is cashback?
An incentive program known as cashback allows you to receive a portion of your purchases back in the form of cash. Although it’s a common feature on credit cards, some debit cards, mobile wallets, and online shopping sites also provide it.
For the customers, it is a great way to save money on everyday purchases. Remember, it’s not free money you still have to pay your credit card bill each month.
Cashback and Discounts are not the same
Discount is given instantaneously before the bill or invoice is generated. Cashback gets reflected in the monthly statement of a card to the cardholder as credit.
| Discount | Cashback |
| You receive the savings upfront at the time of purchase. The final price you pay at checkout is already reduced by the discount amount. | You receive the savings later, usually after the purchase is complete and processed. The amount is typically credited to your account, deposited into your bank, or issued as a check. |
| The discount applies directly to the specific item you’re purchasing. You can’t use it for anything else. | The cashback amount is typically more flexible. You can often use it towards future purchases, transfer it to your bank account, or redeem it for other rewards depending on the program. |
| Discounts can create a sense of urgency and encourage immediate purchases. | Cashback can feel like a bonus or reward, fostering customer loyalty and long-term engagement. |
When cashback is credited to buyers
Well, it depends on specific program you are using.
Credit cards: Cashback on credit cards typically gets credited after your statement closes and the payment is due.
Debit cards: Debit card cashback programs can vary greatly. Some credit cashback instantly after the purchase, while others might wait until the end of the month or after a certain threshold is reached.
Retailer promotions: Cashback offered directly by retailers often gets credited automatically within a specific timeframe stated in the offer details, which could be anywhere from a few days to several weeks.
Cashback apps and websites: These platforms usually have their own terms and conditions regarding crediting times
Example
Suppose you have to buy a phone that is $500. If there is a 15% discount on the phone. You would pay 85% of its price, which is $425 and the discount would be $75.
In the case of cashback, you pay the full amount when you buy the phone. The bank will credit $75 for this purchase to your credit card statement, which is due after the purchase.
You might like to read: About Freebies
Cashback websites
These programs reward their customers for shopping using their website. Usually, you will find all offers and links to the product page and a reward will be added after you complete the purchase.
A cashback website is run by a team that works as a middleman. A type of reward website that pays its members a percentage of earning.
Some of cashback websites
eBates – Best for international customers where you see all major international brands.
Reward for free drinks – From the best companies for cashback and sometimes free offers based on food & drinks.
Indian cashback websites – Indian cashback websites are listed here. Go for some of the best cashback sites in India.