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Rotating 5% cash back: A review of the Discover it Cash Back credit card

Nov. 21, 2021
10 min read
Young Woman Shopping Online With Laptop And Credit Card At Home
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Editor’s note: This is a recurring post, regularly updated with new information. This page includes information about the Discover it Cash Back that is not currently available on The Points Guy and may be out of date.


The Discover it Cash Back provides 5% cash back on the first $1,500 in purchases that you make each quarter at select merchants. The eligible merchants rotate quarterly and require enrollment. You’ll earn 1% cash back on all other purchases and the card doesn’t charge an annual fee. There’s no traditional sign-up bonus, but Discover will match all the cash back you’ve earned at the end of your first year. Card Rating*: ⭐⭐⭐

*Card Rating is based on the opinion of TPG’s editors and is not influenced by the card issuer.

Determining how to maximize the points and miles earned by many credit cards can be complicated and time-consuming — and may seem less valuable if you don’t travel. For both of these reasons, some folks opt for credit cards that earn cash back.

Among them, the Discover it Cash Back card provides 5% cash back on the first $1,500 in purchases that you make each quarter you enroll at select merchants, which change every three months. These merchants include gas stations, grocery stores, restaurants and more. Even if you use travel rewards cards for most purchases, you may find value in adding this card to your wallet thanks to the fact that it makes earning cash back so easy.

Let’s dive into the card’s benefits, earning, redeeming and how it compares to other cards to decide if the Discover it Cash Back card is right for you.

The information for the Discover it Cash Back and Discover it Student Cash Back cards has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Who is this card for?

The Discover it Cash Back card earns cash back in rotating quarterly categories as well as on everyday purchases, all without charging an annual fee.

That said, you probably shouldn’t rely on the Discover it as your primary or only credit card since you may find some quarters where the bonus categories don’t match up with your personal spending patterns.

The Discover it Cash Back is most comparable to the Chase Freedom Flex, which may be a better option if you have (or plan to get) a Chase Ultimate Rewards-earning card so you can take advantage of that rewards program's travel transfer partners.

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On the other hand, it’s generally easier to get approved for the Discover it Cash Back, so it may be a better choice for customers with lower credit scores.

Related: TPG beginner’s guide: Everything you need to know about points, miles, airlines and credit cards

Introductory offer

The Discover it Cash Back doesn’t offer a traditional sign-up bonus, but it does offer a unique earning opportunity for new cardholders.

Discover will match all the cash back you earn during the first 12 consecutive billing periods that your new account is open. The match for the entire year occurs at the end of the 12th billing period. The card is also currently offering a 0% introductory APR on purchases and balance transfers for the first 14 months; then a variable APR of 12.24% - 23.24% applies, which can be useful if you’re looking to pay down credit card debt. Just beware that there is a 3% introductory balance transfer fee and it goes up to 5% after that.

Related: The top credit cards with 0% intro APR

Main benefits and perks

The simplicity of the Discover it Cash Back card makes it ideal for new cardholders. (Photo by Shutterstock)

The Discover it Cash Back card has benefits and perks that are well-suited for first-time or less experienced cardholders. It is simple and straightforward to earn and redeem cash back — but we’ll dedicate later sections of this review to earning and redeeming. First, let’s consider the card’s other benefits:

  • No foreign transaction fees.
  • Free overnight shipping for card replacement to any U.S. street address.
  • Freeze your account in seconds to prevent new purchases with an on/off switch available on both the mobile app and website.
  • Free Credit Scorecard that includes your credit score, number of recent inquiries and more.
  • Free alerts you can activate to know when any new credit card, mortgage, car loan or other account shows up on your credit report.
  • Free alerts you can activate that notify you if your Social Security number is found on any of thousands of dark web sites.

Related: Your ultimate guide to Discover cards

How to earn cash back

The Discover it Cash Back earns 5% cash back with different merchants each quarter you enroll, like gas stations, grocery stores, restaurants, Amazon.com and more. For example, from now through the end of December 2021, you’ll earn 5% cash back at Amazon.com, Walmart.com and Target.com.

Related: Discover announces 5% cash-back quarterly categories for 2022

You need to activate the 5% earning before making purchases in the bonus category each quarter — but Discover makes the process easy online, and you can activate up to two months before each quarter begins. You’ll only earn 5% cash back on up to $1,500 in purchases each quarter at eligible merchants after enrollment, however. Assuming you spend $1,500 on purchases in the 5% categories during a quarter that you activate the bonus, you’ll earn $75 in cash back on these purchases.

You’ll also earn 1% cash back on all other purchases with the Discover it Cash Back. However, you can boost your cash-back percentage on other purchases by using another card with better flat-rate earnings or increased earnings in select categories. One example is the Discover it Miles, which also matches the cash back you earn during your first year.

Related reading: Why you should get the Discover it Miles

How to redeem cash back

(Summer Hull / The Points Guy)
You can redeem your Discover it cash back on gift cards. (Summer Hull / The Points Guy)

Some cards earn cash-back rewards but then make it difficult to actually obtain your cash back. This is one place the Discover it Cash Back card excels. There are many options and most will allow you to obtain as little as a penny in cash back. They include:

  • Gift cards or instant eCertificates, starting at $20.
  • Charitable donations to select charities, starting at a penny.
  • Credit to your account, starting at a penny.
  • Electronic deposit into any account you designate, starting at a penny.
  • Pay with Cashback Bonus at select merchants, starting at a penny.

For all but one of these options, your cash back is worth its face value. Gift cards can be the exception — some are available with a bonus. For example, you may be able to find some merchants offering a $25 or $30 gift card for $20 in cash back. If you shop with any of these merchants, this will provide the best value. Otherwise, I’d recommend simply redeeming for a credit to your account — instead of using a gift card, you can charge another purchase to your credit card and earn even more rewards.

Related: How to redeem Discover cash-back rewards

How does the Discover it Cash Back compare?

The Discover it Cash Back earns 5% on bonus categories that change each quarter on the first $1,500 in purchases in those categories (enrollment required). This means that it is directly comparable to the Chase Freedom Flex, which also earns 5% on bonus categories that change quarterly (activation required) and also doesn’t charge an annual fee.

However, the Chase Freedom Flex also earns 5% back on travel purchased through Chase, 3% back on dining and at drugstores and 1% back on other purchases, making it potentially a much stronger earner than the Discover it Cash Back.

The Chase Freedom Flex has a few other benefits that aren’t provided by the Discover it Cash Back, too, such as extended warranty protection, purchase protection, trip cancellation and interruption insurance, and a secondary auto rental collision damage waiver.

If you’re looking for a rotating bonus categories card that can become part of a solid Ultimate Rewards points-earning strategy, the Chase Freedom Flex will be a better choice when paired with a Chase Ultimate Rewards-earning card such as the Chase Sapphire Reserve or Chase Sapphire Preferred Card. However, the Discover it Cash Back tends to accept lower credit scores, which makes it a better choice if you have less-than-excellent credit.

Cards with rotating bonus categories like the Discover it Cash Back and Chase Freedom Flex can complement other cards, but should probably not be your primary card.

If cash back is your ultimate goal, you might want to consider a flat-rate cash-back card such as the Citi® Double Cash Card, Chase Freedom Unlimited, Capital One Quicksilver Cash Rewards Credit Card or Discover it Miles for your wallet since they provide a higher rate of return on everyday spending without having to keep track of special categories. You also may find it helpful to have a few cards that provide useful travel benefits or increased earning in categories you frequently use.

If you are a student, you may want to consider the student version of the Discover it Cash Back — the Discover it Student Cash Back.

Related: The best cash-back credit cards of 2021

Bottom line

The Discover it Cash Back provides 5% cash back on up to $1,500 in purchases each quarter in rotating categories. The card has no annual fee, so it’s a relatively easy choice to add to your wallet for use in these categories each quarter — especially if you’ve already exhausted your Chase 5/24 slots.

However, the potential cash back in these 5% categories is limited to the first $1,500 in purchases each quarter and you’ll only earn 1% cash back on all other purchases, so this shouldn’t be your everyday go-to card.

Featured image by Getty Images
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
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TPG featured card

Best premium travel card for value
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

1 - 10X points
10xEarn 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards®.
5xEarn 5x total points on flights through Chase Ultimate Rewards®.
3xEarn 3x points on other travel and dining.
1xEarn 1 point per $1 spent on all other purchases

Intro offer

80,000 bonus points
Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

Annual Fee

$550

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more
Best premium travel card for value
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10xEarn 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards®.
5xEarn 5x total points on flights through Chase Ultimate Rewards®.
3xEarn 3x points on other travel and dining.
1xEarn 1 point per $1 spent on all other purchases
  • Intro Offer
    Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®

    80,000 bonus points
  • Annual Fee

    $550
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more