Discover it Cash Back Review

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The Discover it Cash Back is a rotating cash-back credit card that earns a healthy 5% cash back on spending in categories such as groceries or gas that change every quarter. On top of that, it gives you a modest 1% back on all other purchases. For new cardholders Discover’s first year “Cashback Match” can be a lucrative, one-time bonus.

Discover it® Cash Back

Overall Rating
3.5
Discover it® Cash Back
Recommended Credit Score Our recommended ranges are based off of the FICO® Score 8 credit-scoring model. Credit score is one of the many factors lenders review in considering your application.
350 579
580 669
670 739
740 799
800 850
Good - Excellent
Regular APR (%) 11.99% - 22.99% variable
Annual Fee $0
Rewards Earning Rate Earn 5% cash back on rotating categories each quarter each time you activate. Plus, earn unlimited 1% cash back on all other purchases.
INTRO PURCHASE APR 0% for 14 Months
Foreign transaction fee (%) 0%
Ratings Breakdown
for Interest
3.5
for Fees
3.5
for Rewards
2.4
for Credit
3.7
Current Offer

Discover will match all the cash back you've earned at the end of your first year, automatically.

Who Is This Credit Card Best For?

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    Savvy Saver

The Discover it Cash Back is a good option for anyone who wants to earn cash back on their day-to-day purchases. Bonus categories rotate every quarter, and in 2020 include purchases at grocery stores, gas stations, restaurants, rideshare companies, and some online retailers. Consumers who spend in those categories are positioned to earn plenty of cash back.

But keeping on top of those categories requires some work. You have to sign up for bonus categories each quarter and perhaps remember to use this card instead of another card on purchases in those categories. So, the card is best for people who don’t mind going the extra mile to maximize their rewards.

Pros
  • Strong rewards potential

  • Good introductory interest offer

  • Excellent customer service

Cons
  • Rewards require work

  • Rewards-earning caps

  • No cardholder perks

Pros Explained

  • Strong rewards potential: While you’ll only earn 1% back on your regular spending, we like the fact this card gives you 5% back on the first $1,500 every quarter that you spend in the rotating categories. Discover’s 5% categories tend to be ones consumers can benefit from, making it easy to strategically max them out. Also note that Discover will match all your rewards the first year.
  • Good introductory interest offer: You’ll get 14 months of 0% interest on purchases and balance transfers. Balance transfers need to be executed before Oct. 10, 2020. During that time you’ll also get a break on the balance transfer fee—it’s 3% instead of the usual 5%. Only a few competing cash-back cards offer longer 0% interest promotions on both purchases and balance transfers. 
  • Excellent customer service: Discover consistently ranks high in customer satisfaction studies and takes several steps to earn, and keep, that reputation. 

Cons Explained

  • Rewards require work: Some cash-back cards let you rack up bonus rewards just for using your card, but the Discover it Cash Back requires you to “activate” your card to earn 5% in bonus categories each quarter. If you fail to activate within the specified time, you’ll miss out on the bonus rewards-earning rate.  
  • Rewards-earning caps: The Discover it Cash Back returns 5% back on up to $1,500 spent every quarter in bonus categories, but you only earn 1% in those categories once you surpass that threshold. This means you can only earn $75 in bonus cash back each quarter.
  • No cardholder perks: This card has none of the perks similar cards offer, such as extended warranties, rental car collision insurance, or purchase protection.

Discover it Cash Back Bonus

Discover gives its cards a unique take on the familiar new-cardholder bonus. Instead of basing it on a fixed amount of spending in a limited amount of time (say, $500 in the first 90 days to earn $150 cash back), Discover matches all the cash back you’ve earned in your first year with a lump sum after the end of that year. Although you’ll have to wait longer to get it, you could easily earn twice as much as a traditional new-cardholder bonus.

Based on our calculations and average household spending in the U.S. ($24,297 in 2018, per the Bureau of Labor Statistics), you’ll earn about $376 in rewards each year you have the card. That would make your first-year cash-back match worth $376, too. 

Earning Points & Rewards

You’ll earn 5% back on up to $1,500 spent in the bonus categories for any given quarter, and then 1%. The categories rotate and must be activated each quarter to earn the bonus cash. You’ll also earn 1% back on all of your other spending, and none of your cash back expires.

Discover it 5% Cash-Back Calendar For 2020
Period 5% Cash-Back Rewards Categories When to Enroll
Q1 (Jan.-March) Grocery stores, Walgreens, and CVS Now
Q2 (April-June) Gas stations, Uber, Lyft, and wholesale clubs Now
Q3 (July-Sept.) Restaurants and PayPal Now
Q4 (Oct.-Dec.) Amazon.com, Walmart.com, and Target.com As soon as Aug. 1

While $376 is our estimate of your annual cash-back potential based on average household spending (according to the BLS), you’re certainly not limited to that. That level of spending works out to an effective cash-back rate of 1.5%. (In other words, it’s the same as if you earned 1.5% back on everything you bought). But if you were to max out each quarter’s 5% bonus category, you’d earn $300 a year just for those purchases, plus 1% on everything else, so your total earnings could be much more than $376.

Redeeming Rewards

Rewards earned with the Discover it Cash Back can be redeemed any time and for any amount. Redemption options include:

  • Gift cards or e-certificates starting at $20
  • Charitable donations starting at 1 cent
  • Statement credits to your Discover account starting at 1 cent
  • Transfers to a bank account starting at 1 cent
  • Purchases made via PayPal or at Amazon.com starting at 1 cent

How to Get the Most Out of This Card

Make sure to activate your bonus categories each quarter and use the card to the best of your ability, perhaps planning big-ticket purchases in advance. Also charge as many other purchases as you can to the card, since all your cash back will be matched after the first 12 months. You might want to set alerts on your phone or mark your calendar to remind you to activate your categories every quarter.

Since your cash-back rewards are worth exactly 1 cent a piece no matter how you use them, cash them in however you want. 

You might also take advantage of the 14 months of 0% interest on purchases and balance transfers. You could make a big household purchase and pay it off, interest free, over the following 14 months. Or, you could move high-interest credit card debt to your new Discover card and pay it off over the next year and change.

 A balance transfer can be a smart way to reduce your debt burden, but be aware of a couple of catches. First, you’ll pay a fee on the amount transferred (3% or 5% with this card, depending on when you make the transfer). Second, most issuers will treat transferred balances as regular balances when it comes to factoring the grace period for avoiding interest charges on regular purchases. That generally means you’ll pay interest on purchases from the date of the transaction—even if you pay your new balances off every month. Fortunately, because this card features 0% interest for both purchases and balance transfers, new cardholders won’t be caught by this catch.

Customer Experience

Discover offers U.S.-based customer service that is available any time of the day or night, which is likely part of the reason it ranked No. 1 among major credit card issuers in J.D. Power’s 2019 Credit Card Satisfaction Study. 

Like many of its competitors, Discover also provides its customers with access to their FICO credit scores and other key credit information.

Security Features

Discover provides industry standard security features including zero liability for fraudulent purchases, and account monitoring and alerts.

Discover it Cash Back’s Fees That Stand Out

Most of the card’s fees are in line with industry standards for cash-back cards, but note the lack of foreign transaction fee. Another nice fee feature? The first time you miss a payment you won’t be charged a late fee and you won’t see your interest rate balloon to the penalty APR.

Next Steps
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CURRENT CARD
Discover it® Cash Back
overall rating
3.5
Recommended Credit Score Our recommended ranges are based off of the FICO® Score 8 credit-scoring model. Credit score is one of the many factors lenders review in considering your application.
350 579
580 669
670 739
740 799
800 850
Good - Excellent
Regular APR (%) 11.99% - 22.99% variable
Annual Fee $0
Rewards Earning Rate Earn 5% cash back on rotating categories each quarter each time you activate. Plus, earn unlimited 1% cash back on all other purchases.
Our Methodology
At The Balance, we are dedicated to giving you unbiased, comprehensive credit card reviews. To do this, we collect data on hundreds of cards and score more than 55 features that affect your finances.
  • Our Reviews Are Always Impartial: No one can influence which cards we review, the way we present them to you, or the ratings they receive. The scores and reviews come directly from the data we collect and our editorial expertise, and we focus on three areas:
  • How Much Does It Cost? With credit card debt at an all-time high, we believe you should know the cost of carrying a balance. Because of that, we give regular purchase APRs significant weight in overall scores, and cards receive low marks if they have an array of pricey fees.
  • What Are the Rewards Worth? Cards accumulate rewards in different currencies—points, miles, cash back—and their values vary widely. To simplify the problem, we built a system that fairly compares rewards and gives them a dollar value. We do this by looking at the ways you can earn and use rewards, which includes evaluating Americans’ typical spending habits and analyzing common travel patterns.
  • Does It Make Your Life Easier? Our scoring system favors cards that accept a wide range of credit profiles and offer simple solutions for things like checking your credit score or contacting customer service. Finally, we give preference to credit cards that have several tools for dealing with fraudulent charges.
  • For every review on The Balance, we hold the credit cards to these standards, and we set the bar high. While we recognize the appeal of splashy features like six-digit sign-up bonuses, our approach ensures that credit cards with the best combination of value, affordability, and accessibility receive the highest scores. See our full methodology for more details.

Article Sources

The Balance requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy .
  1. Discover. "The New 5% Calendar Is Here." Accessed July 21, 2020.

  2. J.D. Power. "Credit Card Rewards War Reaches Inflection Point as Competition Grows, J.D. Power Finds." Accessed July 21, 2020.