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Points of View: Will my rewards change if I pay by mobile wallet?

March 24, 2023
7 min read
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Here at TPG, we regularly emphasize maximizing your earnings on each purchase. For example, we recommend using these credit cards at supermarkets and paying with these cards when at the gas pump.

But what if you use a mobile wallet — such as Apple Pay or Google Wallet — to pay for purchases? Will your "great for supermarkets" credit card still earn bonus points or cash back, or will that purchase code as something else, forfeiting rewards?

Let's examine whether your rewards will change if you pay by mobile wallet.

What is a mobile wallet?

Before we jump in, let's clarify what a mobile wallet is.

A mobile wallet is a smartphone app that holds things like credit cards, gift cards and mobile boarding passes for a flight. You don't need to show your physical credit card when paying with a mobile wallet. Instead, you hold your device near the payment terminal and make payments that way.

Mobile wallets can be useful for those who carry multiple credit cards, as you'll have the ability to use them without the bulk of carrying them in your physical wallet.

Related: Are mobile wallets safe?

WESTEND61/GETTY IMAGES

Most credit and debit cards can be used with mobile wallets. However, there are exceptions.

You can't add ATM-only cards. You also can't add corporate credit cards from most issuers or small-business credit cards from Bank of America.

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Know, too, that you might receive an error when adding a new card since your mobile wallet may need time to complete a security review on your newly-activated card.

What rewards will you earn from mobile payments?

The good news is that mobile wallet payments at a supermarket should still code as a supermarket expense on your credit card statement, earning whatever rewards your card provides for supermarkets. That's because the Merchant Category Code — which stores set to identify their business type — stays the same. The MCC on your payment shouldn't change whether you swipe your credit card or pay with that same card through your phone's mobile wallet.

Related: Is it time to ditch your wallet? The pros and cons of mobile payments

However, note that I said "shouldn't." You may sometimes see strange coding on these kinds of purchases. For example, two TPG employees had recent mobile wallet purchases at Walgreens, Rite Aid and CVS code as "merchandise."

I also ran into a unique situation while living in Brazil for nearly six years. Most businesses in Brazil that accept American Express cards use a separate credit card machine for these payments. Because of this, they classify the second payment terminal differently than the first.

For example, a restaurant will have a credit card machine for Visa, Mastercard or Discover payments; as the primary credit card machine, it's assigned a "restaurant" MCC. The Amex terminal is assigned a "bar" MCC to separate the payment-processing machines. That means these payments don't earn bonus points in a restaurant category.

TPG points and miles reporter Kyle Olsen had the same experience when visiting Brazil last month. When paying with Amex cards, he didn't earn bonus points at restaurants.

On a recent trip to Brazil, points and miles reporter Kyle Olsen didn't earn bonus points at restaurants with Amex payments. AMERICANEXPRESS.COM

Barring these abnormalities, most mobile wallet payments earn how you would expect: Supermarkets are supermarkets, gas is gas and taxis are taxis. A credit card with bonus-earning rates in those categories should provide the associated benefits.

Credit cards with bonus earnings for mobile payments

Some credit cards award bonus points when making mobile wallet payments, regardless of your purchase. You could make a mobile wallet payment at your corner store or local mechanic and earn bonus points in this category, regardless of your card's other earning categories.

There aren't many cards that earn extra rewards on mobile wallet payments. However, they can provide serious value when you compare the mobile wallet earning rates to everyday earning rates for swiping your card the old-fashioned way. Here are some top ones:

Card nameMobile wallet earning rateEarning rate on everyday spending
Kroger Rewards World Elite Mastercard®*5 points per dollar — up to $3,000 of these purchases annually, then standard earning rates apply.2 points per dollar at Kroger and its family of brands; 1 point per dollar elsewhere.
U.S. Bank Altitude Reserve Visa Infinite® Card*3 points per dollar.1 point per dollar.
Apple Card*3% back on select merchants; 2% back on Apple Pay purchases otherwise.1% back.
Wells Fargo Cash Wise Visa® Card (no longer accepting applications)*1.8% back on mobile wallet payments in the first 12 months from card opening, then 1.5% back.1.5% back.

*The information for these 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.

For everyday spending (in which you won't earn any bonus points or cash back), changing your payment method could lead to hundreds or thousands of dollars in extra value at the end of the year.

Bottom line

In most situations, paying by mobile wallet should net the same rewards you'd receive by swiping your physical credit card. However, there are some exceptions.

There are a few cards that provide bonuses on mobile wallet payments. Additionally, there are times when you might earn according to your card's everyday spending category. As a result, it's important to double-check your cards' fine print to make sure you maximize your earnings — whether you pay the traditional way or via a mobile wallet.

Editor’s note: “Points of View” is a series evaluating decisions on which credit card to use. If you’re facing a dilemma about which card is best for an upcoming payment, email us at tips@thepointsguy.com with the subject line: "Points of View question."

Also in this series:

Featured image by OSCAR WONG/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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2XEarn 2X Miles at restaurants worldwide, including takeout and delivery in the U.S. and at U.S. supermarkets.
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  • Intro Offer
    Earn 90,000 bonus miles after you spend $4,000 in purchases on your new Card in your first 6 months.

    Earn 90,000 Bonus Miles
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    $250
  • 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.

    670-850
    Excellent/Good

Why We Chose It

Build your loyalty to Delta by applying for the carrier's mid-tier card option, the Delta SkyMiles Platinum card. The annual fee is quickly recouped by the card's travel perks, such as an application credit to Global Entry or TSA Precheck, annual companion certificate and so much more. Plus you can fast-track to elite status simply through card spend.

Pros

  • Earn bonus Medallion® Qualification Miles (MQMs) and an Medallion Qualifying Dollar (MQD) waiver when you hit specific spending thresholds with your card within a calendar year
  • Receive a Domestic Main Cabin round-trip companion certificate each year
  • Statement credit for TSA PreCheck/Global Entry fee (up to $100)
  • First checked bag free

Cons

  • Doesn't make sense if you don't fly Delta
  • SkyMiles aren't the most valuable airline currency
  • Earn 90,000 bonus miles after you spend $4,000 in purchases on your new Card in your first 6 months.
  • Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. Payment of the government imposed taxes and fees of no more than $80 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
  • Enjoy your first checked bag free on Delta flights. Plus enjoy Main Cabin 1 Priority Boarding and settle into your seat sooner.
  • New: Card Members get 15% off when using miles to book Award Travel on Delta flights through delta.com and the Fly Delta app. Discount not applicable to partner-operated flights or to taxes and fees.
  • Earn 3X Miles on Delta purchases and purchases made directly with hotels.
  • Earn 2X Miles at restaurants worldwide including takeout and delivery in the U.S., and at U.S. supermarkets.
  • Earn 1X Mile on all other eligible purchases.
  • Enjoy a per-visit rate of $50 per person for Card Members and up to two guests to enter the Delta Sky Club when traveling on a Delta flight.
  • Fee Credit for Global Entry or TSA PreCheck® after you apply through any Authorized Enrollment Provider. If approved for Global Entry, at no additional charge, you will receive access to TSA PreCheck.
  • Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs up to two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
  • No Foreign Transaction Fees.
  • $250 Annual Fee.
  • Terms Apply.
  • See Rates & Fees