Apart from the ease of transactions, one of the biggest reasons behind the popularity of credit cards is that most credit cards reward you in some way or the other for every transaction made with the card. Generally, almost all credit cards offer one of four types of reward structure- Reward Points, Cashback, Airmiles and Fuel Points.
Whether you’ll earn Rewards Points or Cashback or AirMiles or Fuel Points, or a combination of two or more of these, depends on the category of the card and the kind of customers it targets. For example, many entry-level shopping credit cards often earn rewards in the form of cashback, while almost all travel credit cards earn AirMiles on all purchases you make with the card.
As mentioned earlier, almost all credit cards offer one of four reward structures- Reward Points, Cashback, Airmiles and Fuel Points. In this article, we will analyze each of these reward structures and see which structures are suitable for customers. Finally, we’ll also recommend some of the best credit cards for each of the four types of credit card rewards.
Reward points are the most common type of reward structure that you get from a credit card. You will find credit cards with reward point structure under all categories.
Reward Points Credit Cards earn Reward Points whenever you use the card for any transaction. Many reward point based cards earn reward points at an accelerated rate on certain spending categories. For example, credit cards targeting online shoppers often earn instant reward points on popular shopping websites such as Amazon, Flipkart and Myntra, etc. Travel credit cards often earn instant reward points on travel-related expenses such as hotel reservations and flight bookings.
Reward points earned on these credit cards with the rewards point structure are usually redeemable for shopping vouchers on the card issuer’s rewards redemption portal or for products from the bank’s list of products. Sometimes, reward points can also be transferred to partner airlines’ Airmiles program or hotel loyalty program. Reward points earned on some credit cards can also be adjusted against the card balance in the next month’s statement, however, the redemption rate is usually lower in case of adjustments to the card balance.
best reward point credit card
HDFC Infinia Credit Card: The Infinia Credit Card by HDFC Bank is a super premium credit card by the bank and comes with a membership fee of Rs. 10,000 per year. It is a Reward Points based credit card and earns 5 Reward Points per Rs. Spent with 150 cards. The redemption value of 1 reward point is Re. 1, thus making the card’s effective reward rate 3.3%.
SBI SimplyClick Credit Card: This is one of the most popular shopping credit cards in the Indian credit card market. With SBI SimplyClick Credit Card, you will get Rs. But get 1 reward point. 100 (1 Reward Point = Rs.0.25, Reward Rate = 0.25%) on offline spends and 10x Reward Points (reward points) on partner online merchants including Amazon, Flipkart and MakeMyTrip (Reward Rate = 2.5%) and 5x Reward Points on other online transactions ) rate = 1.25%. SBI SimplyClick Credit Card comes with a subscription fee of Rs. 499 per year.
Standard Chartered Ultimate Credit Card: This is the most premium offering from Standard Chartered Bank. You earn 5 reward points per Rs. Rs.150 spent with the card and additional 5% cashback on duty-free purchases at airports. Hence, the card has both a reward points as well as a cashback reward structure, however, it is primarily a rewards points based credit card as you earn reward points across all spending categories. Earned Reward Points can be redeemed for shopping vouchers and charity spending from popular brands like Croma, Nykaa, Shoppers Stop, etc. 1 reward point = Re. 1 (reward rate = 3.3%)
Axis Bank Magnus Credit Card: This is a premium credit card from Axis Bank and has an annual membership fee of Rs. 10,000. With the card you will get Rs. You get 12 Axis Edge rewards. 200 and 2x EDGE rewards on MakeMyTrip, Yatra, Goibibo and other travel websites. As 1 Axis Edge reward point is equal to Rs. 0.20, Card Magnus Credit Card has a reward rate of 1.2% on regular spend and 2.4% on MakeMyTrip, Yatra and Goibibo.
With many credit cards, especially in the entry-level and mid-level segments, instead of earning reward points, you earn cashback, which is adjusted directly against the card’s outstanding balance in the next month’s billing cycle. The best part about these credit cards with cashback structure is that there is no hassle of redeeming the reward points, and the cashback is automatically posted to your credit card account and in your card statement balance in the next payment cycle. gets adjusted.
best cashback credit card
Flipkart Axis Bank Credit Card: It is one of the most popular shopping credit cards in the entry-level segment launched by Axis Bank in association with Flipkart. Currently, the Flipkart Axis Bank Credit Card is available free of cost (there is no annual fee) as part of a limited period offer. You earn 5% cashback on Flipkart and Myntra purchases with your Flipkart Axis Bank credit card, 4% cashback at partner online merchants including Swiggy, PVR and Uber, and 1.5% cashback on all other online and offline spends.
HDFC Millennia Credit Card: This is another very popular cashback based credit card by HDFC Bank targeted at Millennials and new cardholders. The card comes with an annual fee of Rs 1,000. You earn 5% cashback at partner online merchants including Amazon, Flipkart, Myntra, BookMyShow, etc., and 1% cashback on all other online and offline spends with the Millennia Credit Card.
HDFC Moneyback Plus Credit Card: HDFC has recently launched the MoneyBack Plus credit card as an upgraded version of the old MoneyBack credit card. This is a cashback credit card with an annual fee of Rs. 500. You earn 2 cashpoints per Rs. 150 on regular spend and 5x cashpoint on EMI transactions at select merchants. You also earn 10x Cashpoints on purchases from partner online merchants that include popular names like Amazon, Flipkart, BigBasket, Swiggy, etc. Cashpoints earned on the Card can be redeemed for hotel/booking for purchase of products from the Bank’s exclusive list of products. The statement balance of the card can be adjusted for air tickets, gift vouchers. The value of 1 cashpoint earned on HDFC MoneyBack Credit Card is Rs. 0.25 for any of the above redemption types.
Card issuers offer a number of credit cards that are tailored to the needs of frequent travelers. These credit cards are known as travel credit cards. Travel credit cards have either an AirMiles based rewards structure or earn reward points/cashback at an accelerated rate on travel related expenses. Most travel credit cards that earn AirMiles are co-branded cards that are offered by the card issuer in association with the airline.
best travel credit card
Axis Bank Vistara Infinite Credit Card: Axis Bank’s Vistara Infinite Credit Card is the most premium of the three co-branded offerings by the bank in association with Air Vistara. The Axis Bank Vistara Infinite Credit Card earns Club Vistara (CV) points as rewards on all categories of spends. You earn 6 CV points per Rs. Spent with 200 cards. Earned CV points can be redeemed for category upgradation, award flying, seat reservation on Air Vistara.
6E Rewards XL – Indigo HDFC Bank Credit Card: It is a co-branded travel credit card offered by HDFC Bank in association with Go Indigo. You earn reward points in the form of Indigo 6E Rewards on 6E Rewards XL Credit Card. You earn 5% 6E Rewards on IndiGo purchases, 3% 6E Rewards on grocery and entertainment, and 2% 6E Rewards on all other categories of spending with the 6E Rewards XL – Indigo HDFC Bank Credit Card.
Air Indy SBI Signature Credit Card: As the name suggests, this is a credit card co-branded by SBI Card in association with Air India. The card comes with complimentary membership to Air India’s Frequent Flyer Program – Flying Returns and earns SBI Reward Points which automatically convert to Air India AirMiles within 7 days of accrual. 1 Reward Point earned on the card is equal to 1 Air India Airmile. You earn 4 reward points per Rs. 100 on normal spend with the card, and Rs. Up to 30 reward points. 100 on Air India ticket booking.
Many credit cards are targeted at customers for whom fuel expenses account for a large portion of their card’s statement balance. These cards are known as fuel credit cards. While some fuel credit cards come with regular rewards point/cashback structure, with accelerated reward rates on fuel spend (like HPCL ICICI Super Saver Credit Card and BPCL SBI Card Octane), some other fuel credit cards rewards in the form of fuel points earn. Refundable against fuel purchase.
best fuel credit card
Indian Oil Citi Credit Card: It is a co-branded fuel credit card launched by Citibank in association with IndianOil. It is a mid-level credit card and has a membership fee of Rs. 1,000 per year. You earn 1 Turbo Point (Citibank’s Fuel Point) per Rs. 100 spend with the card on regular spends, 2X Turbo Points on supermarket and grocery spends and 4X Turbo Points at authorized Indian Oil outlets. The Turbo Points earned can be redeemed for fuel purchases (at Indian Oil Filling Stations), travel expenses, online purchases and even cashback adjustments against the card’s statement balance. While there are many options for redeeming Turbo Points, you get the highest reward rate only on redemption of Turbo Points for purchase of fuel at Indian Oil Filling Stations (1 Turbo Point = Rs.1).
Indian Oil HDFC Bank Credit Card: This is another co-branded credit card of Indian Oil by HDFC Bank. It is an entry-level credit card and offers only Rs. Comes with a nominal membership fee. 500 per year. The card comes with a Fuel Points based reward structure. You per Rs. I earn 1 fuel point. 150 on regular spends with the card and 5 reward points per Rs. 100 was spent on fuel purchase, groceries and utility bill payments. While the Fuel Points earned can also be redeemed for purchasing products from the bank’s product catalog or for cashback (adjustment against the card’s statement balance), like the Indian Oil Citi Credit Card, you get the highest reward rate (1 Fuel Points = Rs. 0.96) on redemption of fuel points for fuel purchase at Indian Oil Filling Stations only.
Card issuers offer credit cards with different types of credit card rewards- reward points, cashback, airmiles and fuel points depending on the card target given by the customers. It is advisable to choose a card based on the ratio of spend under different spending categories on your credit card statement.