Cashback explained: get paid for spending you'd do anyway
Cashback is money paid back to you on spending you were going to do anyway. Used sensibly, it's a genuine saving. Used carelessly, it can tempt you into spending more than you meant to.
The main types
There are a few common ways to earn cashback, and they can sometimes be stacked.
- Cashback websites: click through to a retailer and earn a percentage back
- Cashback debit or credit cards: earn a small percentage on everyday spending
- Bank account rewards: some accounts pay cashback on direct debits
The golden rule
Only count cashback on things you'd have bought anyway. A discount on an unnecessary purchase isn't a saving, it's still spending. Cashback works best on regular, planned outgoings.
Watch the catches
Cashback can take weeks or months to track and pay. On credit cards, only earn it if you clear the balance in full each month, otherwise interest wipes out the reward. Always check the terms.
Frugl provides general information to help you compare options. We are not a Financial Advisor and this is not personalised advice. Always check the provider's own terms before buying.