up to 5% Cash Back and No Annual Fee

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The Discover it® Cash Back is a solid cash-back rewards card that offers 5% back on popular rotating categories up to a spending limit. Your rewards are matched by Discover after the first 12 months, and the card has no annual fee (from July 1 to September 30, 2022, you can earn 5% cash back at restaurants and PayPal on up to $1,500 in purchases after enrollment, then 1%). 

Review: Is the Discover it Cash Back the best credit card for you?

If you prefer earning cash-back credit card rewards without paying an annual fee, the Discover it® Cash Back is a great choice. The card offers a solid 5% cash back in popular rotating quarterly bonus categories when you activate, on up to $1,500 in combined spending (then 1%). You’ll also earn 1% back everywhere else (from July 1 to September 30, 2022, you can earn 5% cash back at restaurants and PayPal on up to $1,500 in purchases after enrollment, then 1%).

While the card doesn’t offer a traditional welcome bonus, Discover will match all of the rewards you earn from the Discover it® Cash Back after the first 12 months through its Cashback Match program, so your 5% rewards are effectively worth 10% cash back in the first year. That’s an amazing deal for a card with no annual fee.

For 2022, the Discover 5% quarterly bonus calendar categories are as follows:

The Discover it® Cash Back is great for those who don’t want to pay an annual fee, and it also comes with a 0% intro APR for 15 months on purchases and balance transfers, then an APR of 13.49% – 24.49% Variable. That’s a nice feature if you have purchases coming up that you want to pay off over time without accruing interest.

Keep in mind that Discover cards are not quite as widely accepted as those from larger issuers, so you may want to carry this card and a backup if you can’t use it. However, acceptance has grown in recent years, and with no annual fee, there’s little harm in pairing your Discover it® Cash Back with another cash-back card.

For example, you could look at a no-annual-fee card that offers a flat cash-back rate on all purchases, like the Wells Fargo Active Cash® Card, which earns 2% cash rewards on spending. Or, consider the Chase Freedom Flex℠, which also offers quarterly rotating 5% bonus categories with the same spending cap when you activate. 

There’s also the  Citi Custom Cash℠ Card, which earns 5% cash back on up to $500 spent in your top eligible spending category (from a list) each billing cycle (then 1%), and 1% back on everything else. This card doesn’t require you to activate the bonus, so it may be a better choice if you prefer a hands-off approach.

We’re focused here on the rewards and perks that come with each card. These cards won’t be worth it if you’re paying interest or late fees. When using a credit card, it’s important to pay your balance in full each month, make payments on time, and only spend what you can afford to pay.

How to earn rewards with the Discover it Cash Back card

To earn the most cash back with the Discover it® Cash Back, you’ll have to activate the rotating bonus categories each quarter through your online Discover account.

Once you’ve activated the bonus, you’ll earn 5% cash back on up to $1,500 in combined spending (then 1%) in that quarter’s categories (from July 1 to September 30, 2022, you can earn 5% cash back at restaurants and PayPal on up to $1,500 in purchases after enrollment, then 1%). All other purchases earn a flat rate of 1% cash back.

Discover will automatically match, dollar-for-dollar, all the cash back you’ve earned at the end of your first year (even on bonus categories). You don’t need to do anything to activate this match.

How to use Discover cash back rewards

The best way to redeem your Discover it® Cash Back rewards is usually as a statement credit, which lowers your balance, or simply take the cash as a direct deposit to your bank account. You can also redeem your rewards directly when you check out at Amazon or PayPal. In any of these cases, the minimum redemption amount is 1 cent.

You can also use your rewards, starting at $5, for gift cards or eCertificates from partner retailers. As long as your account is open, your cash-back rewards will not expire.

One somewhat unique redemption option is the ability to donate your rewards to select charities, with a minimum of 1 cent. While this could make it more complicated to get a charitable donation tax deduction compared to writing a check or making a donation directly with a card, it’s nice to see the ability to use your cash to support causes close to your heart.

Discover it Cash Back benefits and features

The Discover it® Cash Back is a fairly straightforward card. Outside of the cash back you’ll earn from everyday spending, here are some useful features to know about:

• Unique designs: Choose from more than two dozen different designs, so you have a credit card that matches your personality.
  
• Security features: Freeze your account if you misplace your card or are worried about fraud using the Discover app or website. Discover can also search the web for security breaches where your Social Security number was disclosed with free Discover Identity Alerts, and remove your info from information-collecting websites through its Online Privacy Protection program.
  
• FICO credit score: Get a real, free FICO credit score that Discover uses to approve accounts, set interest rates, and choose account limits.
  
• No late payment fee on your first late payment: You won’t be charged a fee the first time you pay late, but after that, a fee of up to $41 applies.

The card doesn’t list any major purchase protections or travel insurance benefits, so keep that in mind when shopping. For big-ticket items or large purchases, you may want to consider one of the best credit cards with purchase protection instead. And for travel, a credit card with travel insurance can save you a ton of headache and money if things go awry on the road. 

Fees and costs

Discover typically offers low fees with its credit card and banking products, and there’s no exception here. The Discover it® Cash Back doesn’t have an annual fee or foreign transaction fees, and most other charges are easy to avoid. As with all credit cards, if you pay off your balance in full by the due date, you won’t owe any interest.

When you sign up for a new account, you’ll get a 0% intro APR for 15 months on purchases and balance transfers, then a 13.49% – 24.49% Variable APR. Balance transfers have an intro 3% balance transfer fee (after that, 5% (see rates)).

There’s no late payment fee for your first late payment, but after that, a penalty will apply. There are also fees for returned payments (up to $41) and cash advances ($10 or 5% of the amount of each cash advance, whichever is greater), similar to other credit cards.

Comparison: Discover it Cash Back vs other Discover cards

Discover it Cash Back vs other cash-back credit cards

*eligible 5% cash back categories on the Citi Custom Cash℠ Card are restaurants, gas stations, grocery stores, select travel, select transit, select

streaming

services, drugstores, home improvement stores, fitness clubs, and live entertainment

Discover it Cash Back frequently asked questions (FAQ)

What credit score do I need to be approved for the Discover it Cash Back?

You’ll usually need a credit score in the good to excellent range to be approved for the Discover it® Cash Back card, which means a FICO score of at least 670, or a VantageScore of at least 700.

If you’re not quite there yet, there are other Discover cards you may qualify for. The Discover it® Secured Credit Card, for example, is geared to folks who are new to credit or rebuilding credit. And the Discover it® Student Cash Back is an excellent option for college students who don’t have a long credit history.

Where can I use the Discover it Cash Back card?

You can use Discover credit cards at 99% of the places that accept credit cards nationwide. However, you might run into a few merchants, like Costco, that won’t take Discover cards.

Discover cards are also accepted internationally in 200 countries. Plus, you’ll still earn rewards for your purchases no matter where you use your card.

What is Discover Cashback Match?

When you open an eligible new Discover card, you’ll be able to take advantage of Discover Cashback Match (called Unlimited Bonus with the Discover it® Miles). Discover will match all the rewards you earned after the first 12 months with no caps, including your bonus category earning. 

For instance, if you earned $400 in rewards in the first year of having the Discover it® Cash Back, Discover would match that for a total of $800 back in the first 12 months.