Debit Card Rewards Programs

Check out the best debit card rewards programs available now.

Do you remember when debit card rewards programs were super popular? Unfortunately, debit card rewards have become rarer these days — especially the cash-back reward. The reason these type of rewards have fizzled is due to the 2010 Dodd-Frank act, created in response to the 2008 financial crisis. It includes the Durbin Amendment, which limits the transaction fees that merchants have to pay to the card issuers. Until the amendment was in full effect, every debit card swipe you made at your favorite Tiki bar or steampunk pottery store cost that merchant a fee determined by the card issuer. Today, every interchange fee has a cap of 21 cents or 0.05% of that transaction plus 1 cent for a fraud protection fee.

The result? Debit card issuers don’t want to play anymore. Many issuers have discontinued their debit card rewards programs, closed their programs to new users or started charging higher monthly fees to bank accounts with a debit card attached.

Even so, some options still exist to earn rewards and get cash back with a debit card. Here’s a quick look at the debit card reward options you’ll find in the following sections:

Current Cash-Back Rewards Offers

Cash-back rewards come from debit card transactions made by cardholders. The amount of the reward is usually a small percentage of the cost of the item purchased.

The State of Cash-Back Rewards on Debit Cards

Since the Durbin Amendment, it seemed as if cash-back debit cards were going extinct — at least for large financial institutions — because the banks had to raise fees and reduce rewards to keep up with the new fee limitations. Online banks took advantage of this opening to offer more competitive features tied to their debit cards. Now, however, some brick-and-mortar banks are making a comeback regarding debit card rewards programs.

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Pros and Cons of Cash-Back Debit Cards

When deciding if using a cash-back debit card is the right choice for you, it can be worth your time to consider the pros and cons. Here are some advantages and disadvantages to think about:

Pros

  • Cash back can generally be credited as a cash deposit or check.
  • Cash-back rewards can be spent on anything you chose.
  • Certain online banks offer the ability to earn up to $2,000 in cash back per month.

Cons

  • Foreign transactions fee often applies.
  • Daily transaction limit may apply.
  • Monthly fee or an out-of-network ATM fee may apply.
  • Cash back is not immediate and can take weeks to be credited.

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The Offers

Here’s a sampling of competitive cash-back debit card offers among online and traditional banks:

Comparative Cash-Back Debit Card Rates and Rewards
Debit CardCurrent RewardFor More Info…
Discover Cashback Debit1% cash back for up to $3,000 in debit card purchases each monthSign up for Discover Cashback Debit
Axos CashBack CheckingUp to 1% cash back on all signature-based debit transactionsSign up for Axos CashBack Checking
Bank of America DebitEarn “coins” — which equal cash back — by purchasing mobile and online banking deals with your debit cardSign up for BankAmeriDeals
American Express Serve Cash BackImmediate 1% cash back in your account for every dollar you spend with this prepaid debit cardSign up for American Express Serve Cash Back
PayPal Business Debit CardUnlimited 1% cash back for eligible purchasesSign up for PayPal Business Debit Card

Related: Best Bank Account Promotions Available Now

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Current Points-and-Perks Rewards Offers

Whether it be free airline miles, gift cards or a Starbucks coffee, debit card issuers want you to benefit from your debit card purchases as a way to keep the hungry consumer in you well-fed — yet wanting more.

The State of Points-and-Perks Rewards on Debit Cards

Due to relationships debit card issuers have with other merchants, you can spend money with your debit card and receive points or perks that add up to free booty at certain shops, gas stations, airlines, restaurants and more.

Debit card rewards cards have two types of rewards:

  • Points: Rewards that are like cash back but with points instead of cash. You won’t see deposits in your account, just points that add up to a dollar value, depending on your rewards program.
  • Relationship: Your debit card issuer has preexisting relationships with certain companies, and you can receive perks for their relationship. Companies will offer perks like airline mileage or gift cards if you spend a certain amount on you debit card.

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Pros and Cons of Rewards Debit Cards

Just like anything else, debit cards offering rewards have their pros and cons. Here’s what you need to know.

Pros

  • Unlike with credit cards, you can’t rack up interest charges.
  • Debit cards are generally are fee-free, meaning no annual fee.

Cons

  • Credit card issuers may offer better rewards.
  • Debit card rewards often do not build as quickly as credit card rewards.
  • Some debit card rewards expire if your account is not in good standing.

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The Offers

Although you will find a larger array of rewards with rewards credit cards, there are still a small group of debit cards surviving the crunch. Here’s a look at rewards that are available through some popular debit cards:

Current Points-and-Perks Rewards Offers for Debit Cards
Debit CardCurrent Rewards and PerksFor More Info…
Target REDcard Debit CardSave an additional extra 5% at Target and Target.com everyday; 5% discount on specialty gift cards; 5% off purchases at in-store StarbucksSign up for Target REDcard Debit Card
SunTrust Delta SkyMiles World Debit CardWith a SunTrust Advantage Checking account, earn 1 mile per $2 spent using a PIN or signature-based qualifying purchase; earn 1 additional mile per $2 spent on direct purchases from DeltaSign up for SunTrust Delta SkyMiles World Debit Card
Chase Disney Debit Card10% discount on $50+ purchases at Disney stores; 10% off on select Disney dining experiences; private access meet-and-greets with Disney charactersSign up for Chase Disney Debit Card

Also Check Out: Best Prepaid Debit Cards

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Debit Rewards vs. Credit Rewards

Do a quick internet search about what rewards card is better, and you’ll clearly see banks pushing for you to sign up for a rewards credit card. But don’t let an enticing offer to easily persuade you. Instead, explore what kind of card is better for you and your way of spending.

The Case for Debit Cards With Rewards

If you find yourself racking up interest rates with your credit cards, perhaps stabilizing your spending with a debit card is more your speed. You can still get the rewards you love, but with the cash you actually have. Here are some pros and cons of debit rewards cards to consider:

Pros

  • No interest
  • Easier to qualify for than credit cards
  • Some debit cards don’t require account balance minimums

Cons

  • Less lucrative than credit card rewards programs
  • Less rewards programs or diversity in rewards than credit card rewards programs offer
  • Debit cards linked to your checking account can increase risk of fraud

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The Case for Credit Cards With Rewards

As previously mentioned, most banks and credit unions will give you access to a wider net of rewards — both in quantity of rewards and types — if you choose a credit rewards card, which are obvious pros.

Now for the cons. Many card-issuing companies offer such a grand display of rewards that they fail to highlight the APRs. For example, the average APR for credit cards ranges from 16.94% to 23.94%, according to the U.S. News & World Report card database.

And some credit cards carry higher-than-average APRs. For example, Southwest Rapid Rewards Premier credit card issued by Chase has a variable APR from 17.99% to 24.99%.

Plus, if you don’t consistently pay off your balance each month to avoid interest, the amount of interest you may have to pay can offset any rewards you may earn. For example, if you’re earning 1% cash back on your purchases but paying 18% interest, you’re paying much more in interest than any rewards you’ve gained.

Good To Know: Inventive Ways To Use Your Credit Card to Make Money

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Are Debit Cards With Rewards Worth It?

Ultimately, cash-back or rewards debit cards may not be worth your trouble if your credit score is good enough to qualify for a credit card with rewards. The trick is to avoid interest by consistently paying off your monthly balance.

Credit card and travel journalist Jason Steele said, “Credit card rewards are definitely better than debit card rewards. Ever since the regulation of debit card merchant fees, most banks have been unable to offer significant rewards from debit cards. Those that remain are rarely worth the fees imposed to maintain the account. On the other hand, credit card rewards are an extremely vibrant and competitive market where consumers are constantly being offered ever-increasing amounts of valuable points, miles or cash back. If you want to earn rewards from your spending, you will always be better off with a credit card.”

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Jared Nigro is a writer based in Los Angeles. He works for environmental and socioeconomic institutions including Inside Out Writers and The Dan & Susan Gottlieb Foundation. 

Editorial Note: This content is not provided by American Express. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone and have not been endorsed by American Express.

Editorial Note: This content is not provided or commissioned by the bank advertiser. Opinions expressed here are author’s alone, not those of the bank advertiser, and have not been reviewed, approved or otherwise endorsed by the bank advertiser. This site may be compensated through the bank advertiser Affiliate Program.

About the Author

Jared Nigro is from Pittsburgh, which is obvious by the way he gravitates toward cheese at parties. He is a comedy writer from The Groundlings Sunday Company, Upright Citizens Brigade and has his own digital show on Comedy Central called “Broken People.” When he isn’t being funny, he’s reading books on debt and finance and listening to his favorite finance podcast, ChooseFI.