You’ve seen plenty of credit card promotions offering generous rewards for new applicants. But what about debit cards?
Banks and credit unions that offer rewards for debit card purchases are few and far between. But if you look hard enough, you will find a financial institution that provides debit card rewards programs.
Granted, these perks may not be the same as credit cards. However, something is better than nothing. Besides, if you get 1% cashback whenever you swipe your card, those rewards can add up to big savings.
“Debit cards that offer rewards programs are valuable because they don’t come with the debt-related downsides of credit cards. If you use your debit card regularly for purchases, they can be a great way to get some added benefits,” Jackie Beck, who created Pay Off Debt, an app to help people manage their debt, told US News My Money.
Steven Donovan, a financial coach who started Even Steven Money, agrees. “For the consumer, it’s a simple way to use money that’s in your checking account and still earn rewards without adding another account into the mix.”
Even so, debit card rewards programs can differ wildly, so read the fine print while researching your choices to you understand the terms and conditions. Check for restrictions on monthly rewards, specific purchases, or any fees that could offset the benefit of using the card.
Overall, you want a debit card that has a straightforward, comprehensive program. And you also want it from a financial institution that makes it easier to bank.
US News My Money looked at the best debit card rewards programs to help you decide which one is best for you.
Discover Cashback Debit
With the Discover Cashback Debit, you can earn 1% cashback (up to $3,000 per month). There are some restrictions, including no rewards for ATM withdrawals, money orders, cashback at point-of-sale, loan payments, or depositing money into other accounts using your card.
But, you can exchange your cashback as a credit toward a bank account of your choice. Alternatively, if you already have a Discover credit card, you can rollover your debit card rewards to your credit card and get even more ways to redeem your rewards.
The Discover Cashback Debit has no fees, so you don’t need to be concerned about accumulating rewards to balance your card’s expense.
American Express Serve Cash Back
The American Express Serve Cash Back card isn’t a conventional debit card. It’s a prepaid debit card that allows you to fund it through direct deposits, transfers, or some other method. A prepaid debit card that offers rewards is rare, so if you don’t have a bank account, this could be a viable option.
With the American Express Serve Cash Back, there’s no limit on the 1% cashback you earn, plus no merchant or purchase restrictions, either. The downside is that it costs $7.95 per month to use this card unless you live in New York, Texas, and Vermont. This means you would need to spend a minimum of $795 per month to make up for this monthly fee.
SunTrust Bank Delta SkyMiles World Debit Card
The SunTrust Bank Delta SkyMiles World Debit Card is ideal for people looking for a debit card with great travel perks. When you make your first signature- or PIN-based transaction, you can earn 5,000 miles as well as 1 mile for every dollar on signature- or PIN-based purchases. And if you fly with Delta, you can become eligible for even more miles.
SunTrust Bank offers a tiered system for its rewards program based on which checking account you use. SunTrust Advantage Checking account customers can get 1 mile for every $2 spent on qualifying purchases. SunTrust Exclusive Checking and Signature Advantage Checking account customers can receive one mile for every dollar.
The SunTrust Bank Delta SkyMiles World Debit Card does come with a monthly limit of 4,000 miles. In addition, you also have to pay $95 for the annual fee. However, you may be able to get this lowered, depending on the funds in your SunTrust account.
PayPal Business Debit Card
The PayPal Business Debit Card is best for business owners because it has no limit to its 1% cashback rewards for any signature-based, online, and phone purchases made with Mastercard. However, this debit card doesn’t offer rewards for purchases processed through a debit system, ATM withdrawals, or cash advances.
Another disadvantage is that this card is linked to your PayPal account rather than a business bank account. This means you will need to maintain a balance to use the card and get your rewards.
- Luthi, Ben. “Best Debit Card Rewards Programs.” U.S. News & World Report, U.S. News & World Report, 24 July 2019, money.usnews.com/banking/articles/best-debit-card-rewards-programs.