There are three primary ways cardholders are incentivized to sign up for and continue to use a credit card: Rewards, Offers, and Benefits. Of these three, only Rewards, typically seen in the form of Cash Back/Statement Credits or Points, are awarded based on loyalty or continued spending on the card and act as currency that is redeemable for products or services of the cardholder’s choosing. This report is focused exclusively on reward point redemption.
Most credit cards come with special offers for the cardholder, such as discounts or limited upgrades with retail/service partners. These offers are not interchangeable and often have an expiration date (i.e., “6 months free access to Disney+”), so while they’re an attractive bonus, they do not replace an actual reward currency. Rewards are also distinguished from cardholder benefits like trip insurance, price protection, or airport lounge access, which come included at sign-up from the payment network (Visa, Mastercard, American Express, or Discover) and not the card issuer.
Rewards vs Offers
Credit card redemption currency falls into two categories: cash back and points. Cashback is consistently rated as the most desired credit card reward by consumers, and it’s easy to see why—cash is easy to redeem and available in smaller increments, providing a quicker path to reward redemption. Some banks even allow consumers to automate the cash-back process.
Cash Back Vs Points
Points or Travel Rewards, on the other hand, frequently have a higher reward value per dollar spent. While that often comes with higher annual fees and interest rates, typical card benefits (like free checked bags) more than offset those costs. Travel is also more aspirational. People like the idea of a free vacation—it feels more exciting than a statement credit a few times per year. It offers an emotional connection and more engagement opportunities between the issuer and the consumer.
There are three primary ways cardholders are incentivized to sign up for and continue to use a credit card: Rewards, Offers, and Benefits. Of these three, only Rewards, typically seen in the form of Cash Back/Statement Credits or Points, are awarded based on loyalty or continued spending on the card and act as currency that is redeemable for products or services of the cardholder’s choosing. This report is focused exclusively on reward point redemption.
Most credit cards come with special offers for the cardholder, such as discounts or limited upgrades with retail/service partners. These offers are not interchangeable and often have an expiration date (i.e., “6 months free access to Disney+”), so while they’re an attractive bonus, they do not replace an actual reward currency. Rewards are also distinguished from cardholder benefits like trip insurance, price protection, or airport lounge access, which come included at sign-up from the payment network (Visa, Mastercard, American Express, or Discover) and not the card issuer.
Rewards vs Offers
Credit card redemption currency falls into two categories: cash back and points. Cashback is consistently rated as the most desired credit card reward by consumers, and it’s easy to see why—cash is easy to redeem and available in smaller increments, providing a quicker path to reward redemption. Some banks even allow consumers to automate the cash-back process.
Cash Back Vs Points
Points or Travel Rewards, on the other hand, frequently have a higher reward value per dollar spent. While that often comes with higher annual fees and interest rates, typical card benefits (like free checked bags) more than offset those costs. Travel is also more aspirational. People like the idea of a free vacation—it feels more exciting than a statement credit a few times per year. It offers an emotional connection and more engagement opportunities between the issuer and the consumer.
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