Cash Rebates vs Cashback: What’s The Difference?

Alevin Chan

Alevin Chan

Last updated 21 May, 2024

Cash rebates and cashback both help you spend less on your everyday purchases, but each work in their own way. Find out which one suits you best.

At the most basic level, “cash rebates” and “cashback” mean the same thing: A small amount of cash offset received when you make a qualifying transaction. 

While both terms have the same meaning, cashback and cash rebates can work in different ways. In Singapore, cashback is almost always used exclusively when discussing credit cards. Meanwhile, cash rebates can refer to a wider range of perks and benefits that you can use to reduce your expenditure. 

Let’s take a closer look at cashback and cash rebates, and how you can best make use of them.

Table of contents


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What is cashback and how does it work?

You can think of cashback as an instant discount that is applied on your transactions. As long as the eligibility requirements are met, you will earn cashback. 

Any cashback earned is applied automatically to your statement, and the total cashback amount is used to offset your balance. In this way, you pay less on your credit card bill. 

Here’s an example of how cashback works:

Let’s assume your total cashback earned for the statement month is S$70. Your statement balance is S$1,100. After your cashback is applied, you only pay S$1,030.

How do you earn cashback in Singapore?

The most consistent way to earn cashback is to spend using a cashback credit card. In Singapore, cashback credit cards come in two forms – unlimited cashback cards, and conventional cashback cards

Unlimited cashback cards are so-named because they give you cashback on all retail transactions, less those that are customarily excluded, such as utilities, charity donations, education and healthcare. 

There is also no cap on the amount of cashback you can earn each month, and neither do you have to fulfil a minimum monthly spend. In exchange for the flexibility, the cashback rate is low, at around 1.5% to 1.7%. 

Best Unlimited Cashback Credit Cards

Credit Card Best for/Benefits Details Min. Annual Income
Citi Cash Back+ Card
citicashbackplus-1

 

- 1.6% unlimited cashback on all spending
- No min. spend required

- No cap on cashback earned

- Annual fee: S$196.20 (First year free)
- Local/PR: S$30,000

- Foreigner: S$42,000
AMEX True Cashback Card
amex-true-cashback

 

- 1.5% unlimited cashback on all spending (including education fees, insurance, healthcare, utilities and telco)
 
- Enjoy 3% welcome bonus cashback on up to S$5,000 eligible spend within first 6 months of card approval
- No min. spend required

- No cap on cashback earned

- Annual fee: S$174.40 (First year free)
- Local/PR: S$30,000
CIMB World Mastercard
CIMB-WORLD-MASTERCARD_2019-LR-1024x674

 

- 2% unlimited cashback on Wine & Dine and Online Food Delivery, Movies and Digital Entertainment, Taxi and Automobile, and Luxury Goods
- Min. S$1,000 monthly spend

- No annual fee


- Local/PR: S$30,000
Standard Chartered Simply Cash Card
SimplyCash_front

- 1.5% unlimited cashback on all spending
 
- No min. spend required

- No cap on cashback earned

- Annual fee: S$196.20 (First 2 years free)
- Local/PR: S$30,000

- Foreigner: S$60,000
UOB Absolute Cashback Card
uob-absolute-cardface

 

- 1.7% unlimited cashback on all spending

- Includes insurance, wallet top-ups (excludes Grab), telco bills, and rental
- No min. spend required

- No cap on cashback earned
 
- Annual fee: S$196.20 (First year free)
- Local/PR: S$30,000

- Foreigner: S$40,000
Maybank FC Barcelona Visa Signature Card
maybank-fcb-visasig

 

- 1.6% unlimited cashback on all local spending
- No min. spend required

- No cap on cashback earned
 
- Annual fee: S$120.10 (First 2 years free)
- Local/PR: S$30,000

- Malaysian Citizen: S$45,000

- Foreigner: S$60,000

In contrast, conventional cashback cards provide higher cashback rates of 3%, 5% or even 10%. However, cashback is limited to selected spending categories, such as travel, dining or groceries. 

Also, there is a limit to how much cashback you can earn each month, which varies across different cashback cards. In addition, you will also need to spend a minimum amount each month on your card to be eligible for cashback, although the minimum spend can come from any eligible transactions. 

Best Cashback Credit Cards (with min. spending and cap)

Credit Card Best for/Benefits Details Min. Annual Income
Citi Cash Back Card
Citi_Cashback_Platinum_Mastercard

 

- 8% cashback on Petrol and Private Commute

- 6% cashback on Groceries and Dining

- 0.20% cashback on all other spending
- Min. S$800 monthly spend

- S$80 cashback cap (per statement month)

- Annual fee: S$196.20 (First year free; 9% GST w.e.f. 1 Jan 2024)
- Local/PR: S$30,000

- Foreigner: S$42,000
CIMB Visa Signature Card
CIMBVisaSignatureCard-4
 
- 10% cashback on Online Shopping, Groceries, Beauty & Wellness, Pet Shops & Vet services, and Cruises

- Unlimited 0.2% cashback for all other spending
- Min. S$800 monthly spend

- S$100 cashback cap (per statement month), and up to S$20 per category

- For spend beyond the cap, you will earn 0.2% cashback

- No annual fee
- Local/PR: S$30,000
Maybank Family & Friends Card
Maybank-FamilyFriends_card-1024x697
 
- 8% cashback on 5 selected categories:

1) Groceries
2) Dining & Food Delivery
3) Transport, Data Communication & Online TV Streaming
4) Retail & Pets
5) Online Fashion
6) Entertainment
7) Pharmacy
8) Sports & Sports 9) Apparels
10) Beauty & Wellness

- 0.25% cashback on all other spending
- Min. S$800 monthly spend

- S$125 cashback cap (per statement month), and up to S$25 per category

- Annual fee: S$181.67 (First 3 years free; 9% GST w.e.f. 1 Jan 2024)
- Local/PR: S$30,000

- Malaysian Citizen: S$45,000

- Foreigner: S$60,000
UOB EVOL Card
uob-evol-1024x644
 
- 8% cashback on Online Spend

- 8% cashback on Mobile Contactless Spend

- 0.3% cashback on all other spending
- Min. S$600 monthly spend

- S$60 cashback cap (per statement month), and up to S$20 per category

- Annual fee: S$196.20 (Waived when you make a min. 3 transactions every month for 12 consecutive months)
- Local/PR: S$30,000

- Foreigner: S$40,000
OCBC 365 Card
OCBC365

 

- 5% cashback on Dining and Online Food Delivery

- 6% cashback on Petrol

- 3% cashback on Groceries, Land Transport, Utilities, Streaming, Drugstore and Electric Vehicle Charging

- 0.25% cashback on all other spending
- Min. S$800 & S$1,600 monthly spend

- S$80 & S$160 cashback cap depending on monthly spend tier (per statement month)

- Annual fee: S$196.20 (First 2 years free; 9% GST w.e.f. 1 Jan 2024)
- Local/PR: S$30,000

- Foreigner: S$45,000

Pros and cons of cashback 

With a suitable cashback credit card, it is easy to earn cashback on your everyday expenses. Just spend as you normally would and cashback will be automatically earned when appropriate. At the end of the statement month, your earned cashback is automatically applied to offset your credit card balance, helping you spend less.  Over time, cashback can add up to quite a handsome sum. 

On the flipside, some may not find the small amount of cashback earned each month exciting enough, compared to, say, rewards points, which you can accumulate as long as you like. Also, earning cashback requires consistent spending, and periodic spenders may find it hard to hit the cashback cap each month, thereby earning less cashback than theoretically possible. 


What are cash rebates and how do they work?

Cash rebates can refer to any feature or mechanic that confers a small monetary benefit, mostly given as a reward or to incentivise certain actions. For instance, a new shopping mall may offer discount vouchers as part of its opening promotion, through which shoppers can redeem for cash rebates to offset part of their shopping.

Indeed, the most common form of cash rebates is vouchers, which can only be used under specific conditions, such as during a certain time period, at selected merchants or malls, and only if the purchase exceeds a stipulated minimum. 

Gift vouchers are a form of cash rebate that essentially works like cash that you can spend at qualifying stores or brands. Meanwhile, discount vouchers entitle you to a specified amount of savings when you make a qualifying transaction.

How do you earn cash rebates in Singapore?

Cash rebates are often given as part of lucky draw prizes or sign-up incentives. But if you want to enjoy cash rebates on a consistent basis, the best way is to spend on a credit card that gives you reward points. 

This includes both rewards credit cards and non co-branded air miles cards which give reward points that you can later redeem for air miles. 

You see, the reward points you earn can be put to many uses, including to redeem vouchers at participating merchants and stores. You can look through your card-issuing bank’s rewards catalogue to check for the vouchers you want. If you find any. you can claim them, provided you have sufficient reward points. 

Besides shopping vouchers, cash rebates also come in the form of statement credit. In other words, you can exchange your reward points for cash rebates that are directly applied to your credit card balance. 

Here’s an example of how statement credits work as cash rebates. Let’s assume your bank offers statement credits in the following amounts: 

Statement credit
Reward points needed to claim
S$100
1,500
S$200
2,500
S$500
5,500

You have a total of 5,200 reward points. 

In this case, you can choose to redeem 2 x S$200 statement credits for 5,000 reward points, or wait till you accrue 5,500 points to redeem in S$500 statement credit. 

Once you redeem your statement credit, the amount is automatically applied to your balance as a cash rebate. 

Examples of cash rebate credit cards include:

Free annual access to The Centurion Lounge

  • POSB Everyday Card: Up to 10% cash rebates on everyday spend with min. S$800 spend
  • Standard Chartered Smart Card: 6% cashback in equivalent rewards points on everyday spend, with no min. spend
  • HSBC Visa Platinum Card: 5% cash rebates on family expenses like dining, groceries, and fuel

 

Pros and cons of rebates

The main advantage of cash rebates is that you can save them as you go along or spend them all at once, achieving impressive savings. 

On the flipside, cash rebates often come with many rules and regulations that limit their usefulness. For instance, shopping vouchers commonly cannot be used to pay for items that are on sale. Credit card cash rebates are typically more flexible in how you can use them, but do take note of any expiry dates that render them invalid once past. 


Is there a way to stack both cashback and cash rebates?

Yes, there is, You can pay with a combination of vouchers and a cashback card to enjoy larger savings as you spend. 

For example, let’s say you’ve received a S$20 shopping voucher. Your shopping basket total is S$100. You can use the shopping voucher for a S$20 rebate, which lowers your bill to S$80. 

You can then pay for your shopping using a cashback credit card. This will give you cashback on the remaining S$80, at the prevailing cashback rate offered by your card. So if your card offers 3% cashback, you will earn S$2.40 in cashback for that statement month.

The key thing to remember is that you can only get cashback on the portion of the bill after deducting from the cash rebate. You cannot earn cashback on your rebate. 


Frequently Asked Questions (FAQs)

#1: Is a rebate similar to a cashback?

Rebates can be considered similar to cashback in the sense that they both have the same end goal – helping you lower your expenses. However, as explained, cashback and cash rebates work differently, and some may prefer one over the other.

#2: What is an example of a rebate?

A popular example of a rebate is a shopping voucher that you can use on your next visit. Let’s say you spent S$100 at a restaurant and received a S$10 dining voucher. The next time you visit the restaurant again, you can use the voucher to get a S$10 rebate on your bill. 

 


Looking for the best credit cards to complement your spending patterns and expenditure in 2024? Check out our Ultimate Credit Card Guide that covers all things credit cards in Singapore – from choosing between a cashback, miles, or rewards credit card to planning your credit card strategy.


Read these next:

5 Cashback Credit Cards That Will Help You Save The Most Money
Can Cashback Credit Cards Help Curb Inflation in Singapore?
How to Pay Your Credit Card Bills Each Month?
Credit Cards 101: How Does A Credit Card Work?
Best Cashback Credit Cards in Singapore

An ex-Financial Planner with a curiosity about what makes people tick, Alevin’s mission is to help readers understand the psychology of money. He’s also on an ongoing quest to optimise happiness and enjoyment in his life.

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