You have applied for a credit card and it has finally arrived. You start using it. After some time, you feel that you are not reaping the full benefits of the card. In this care, you need to get the best rewards credit card.
Or, you feel that the rewards that come with the card are either not adequate or are not what you actually need. For instance, you get air miles points which you do not use much instead of the cashback that will help you during the holiday shopping season.
What do you do in such situations? This is where your ability to select the right type of rewards credit card comes into the picture.
There are a number of types of rewards credit cards and each type rewards the user differently. It is up to the consumer in the Indian market to read through the options carefully and choose the right card.
5 Ways To Get The Best Rewards Credit Card
In the following paragraphs, you will learn the different types of rewards credit cards available, capped to four types, and through that, learn to evaluate which one will suit you best.
#1. Fuel Credit cards
This type of card is much more specific. If you use this card to pay for the fuel at a specific outlet regularly, it accumulates points over time. These points can then be redeemed for discounts on fuel prices at a later date.
This card is straightforward and it should be obtained if you drive a lot. The cards mentioned above are the most common type of rewards credit cards available. Whichever card you opt for, ensure that you will use it in the best possible manner to get maximum benefit.
Also, read all terms and conditions carefully to ensure that you know when your points can be used, there might be a short period in the beginning when you are not allowed to redeem points or there might be a condition that a set minimum number of points is required in order to begin redeeming them. Contact the card provider in case of any clarification. Choose wisely!
#2. Credit cards and rewards
In general, credit cards offer their users some type of benefit. We will deal with cashback cards, generic travel cards, co-branded airline and hotel cards, and fuel cards. These four are some of the most common types of credit cards available. Each will provide a specific incentive for the user.
It is up to the user to obtain the full benefits from the rewards cards. The card issuer will not be responsible for informing the user about unclaimed benefits. The rewards are mostly not transferable. These are all points to keep in mind while using a rewards credit card.
#3. Cards that offer cashback
Cashback credit cards are by far the most common types of credit cards around. There are two ways in which you can obtain cashback. One is by spending more.
While this seems counterintuitive, the concept is simple. Some cards have rewards for a specific amount spent. For instance, you might receive 5 reward points for every Rs.1,000 that you spend.
Or, it could be that you receive Rs.50 cashback for every Rs.10,000 that you spend. In most cases, points can be used to buy something. Each product will have a separate number of reward points associated with it and you can use a corresponding number to claim your gift.
There might also be one-time offers that mention that you can receive a cashback of Rs.5,000 if you buy a certain brand of phones or some appliances.
These are promotional offers. All of these qualify as cashback. Cashback does not mean that you get actual, physical cashback. This type of card can be availed by you if you spend on a variety of things and not specifically more on one thing such as travel tickets.
#4. Cards for travel
This type of card is best for people who travel often. In the event that you book a number of travel tickets and eat out often, then this is the best card for you. This card also operates on the same principle as cashback cards. You receive points for a certain type of purchase for a certain value.
For instance, 100 reward points for every flight ticket booked that is over Rs.3000. Points redeemed can be used for anything from entertainment to travel and there is no restriction on its usage. But is advisable to redeem points for travel tickets more than for other types of purchases.
There might also be options through which you can transfer the points accumulated to a hotel loyalty program. In the event that you would like to opt for something like that, you should contact your bank or the hotel that you want to transfer the points.
#5. Co-branded cards for airlines and hotels
This is one of the best types of rewards cards for you if you are a frequent traveler. Booking a flight ticket on a specific airline and hotel chain using the card will accrue benefits for you.
Perks can range from priority boarding and excess baggage allowance for flights. Sometimes, seat upgrades and exclusive lounge access can also be granted.
With hotels, there could be perks like complimentary pick up and drop to and from the hotel and extra time to check out.