Editorial Review

Discover it Cash Back Review: 5% Rewards Are Worth a Little Work

This card offers a high rewards rate in rotating categories, a good 0% APR offer and an unusual bonus that could become a windfall.

Claire TsosieDecember 4, 2019

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Our Take

4.8

NerdWallet rating 

The Bottom Line: If you don't mind keeping track of bonus categories that change every three months, this card is a winner either as an everyday card or as part of a multicard rewards-maximizing strategy.

Discover it® Cash Back

on Discover's website, or call (800) 347-0264

Rates & Fees
Annual Fee

$0

Regular APR

13.49% - 24.49% Variable APR

Intro APR

0% on Purchases and Balance Transfers for 14 months

Recommended Credit Score

Quick FactsView rates and fees

Annual Fee
$0
Annual Fee
$0
Intro APR
0% on Purchases and Balance Transfers for 14 months

Pros & Cons

Pros
  • Cash back match at the end of your first year

  • Bonus cash back categories

  • No annual fee

  • Intro APR period on Purchases and Balance Transfers

Cons
  • Slightly less merchant acceptance for Discover in US - acceptance outside of US can be an issue

  • If you value simplicity, a flat rate cash back card may be better

Alternate Pick: Customizable rewards

U.S. Bank Cash+™ Visa Signature® Card

Pick your own bonus categories

Unlike the Discover it® Cash Back, which picks bonus categories for you, this card earns 5% cash back in two categories you choose, on up to $2,000 in combined purchases each quarter; unlimited 2% cash back in another category you pick; and 1% on everything else. There's a solid sign-up bonus and no annual fee.

Read our review

Compare to Other Cards

Annual Fee

$0

Annual Fee

$0

Annual Fee

$0

Regular APR

13.49% - 24.49% Variable APR

Rates & Fees

Regular APR

16.49% - 25.24% Variable APR

Regular APR

15.49% - 25.49% Variable APR

Intro APR

0% on Purchases and Balance Transfers for 14 months

Intro APR

0% on Purchases and Balance Transfers for 15 months

Intro APR

0% on Balance Transfers for 18 months

Recommended Credit Score
Recommended Credit Score
Recommended Credit Score

Full Review

The Discover it® Cash Back features a high cash-back rate in rotating quarterly categories — but you don't get those rewards automatically, activation is required and spending caps apply.

Even so, for people who prefer cash back and don’t mind putting in a little work, this $0-annual-fee card is well worth it.

Nerd tip: Discover offers a card similar to this one called the Discover it® Balance Transfer. It offers the same rewards, but the introductory 0% APR period is shorter for purchases and longer for balance transfers. Read our review of the Discover it® Balance Transfer.

Discover it® Cash Back: Basics

Card type: Cash back.

Annual fee: $0.

Sign-up bonus: Discover will match ALL the cash back you've earned at the end of your first year, automatically. There's no signing up. And no limit to how much is matched.

Rewards:

  • 5% back in rotating quarterly categories on up to $1,500 in purchases each quarter (requires activation).

  • 1% back on all other purchases.

Redemption: You can redeem cash back in any amount, except in the case of gift certificates and eCertificates, which start at $20. Redemption options include:

  • Direct deposits into any account.

  • Statement credits on your credit card.

  • Donations to select charities.

  • Shopping at Amazon and via PayPal. (You can do this by linking your eligible Discover card to your Amazon or PayPal accounts, paying with that card and applying your cash back at checkout.)

  • Gift cards and eCertificates.

Foreign transaction fees: None.

Balance transfer fee: A 3% introductory fee and up to 5% on future balance transfers. Terms apply.

Other benefits:

The card's current quarterly bonus categories are listed below:

Discover bonus rewards categories for 2019 and 2020

2019 categories

2020 categories

Q1 (Jan. 1 – March 31)

• Grocery stores.

• Grocery stores. • CVS. • Walgreens.

Q2 (April 1 – June 30)

• Gas stations. • Uber and Lyft.

• Gas stations. • Uber and Lyft. • Wholesale clubs.

Q3 (July 1 – Sept. 30)

• Restaurants. • PayPal.

• Restaurants. • PayPal.

Q4 (Oct. 1 – Dec. 31)

• Amazon.com. • Target (in store and online). • Walmart.com.

• Amazon.com. • Target.com. • Walmart.com.

Why you might want the Discover it® Cash Back

The robust rewards and benefits on the Discover it® Cash Back make it one of the most valuable everyday cash-back cards available.

5% cash back in rotating categories

You would be hard-pressed to find a card with no annual fee that earns more than 5% cash back in bonus categories, which for the Discover it® Cash Back have recently included things like gas stations, grocery stores, restaurants, Amazon.com and more.

If you max out the 5% rotating quarterly category rewards each year on this card — that is, if you activated and spent up to $1,500 in those categories each quarter all year — you would earn $300 in bonus cash back, plus 1% back on every other purchase. For many shoppers, those lucrative ongoing rewards make this card a keeper.

A potentially valuable sign-up offer

The Discover it® Cash Back comes with an uncommon sign-up bonus for new cardmembers in their first year: Discover will match ALL the cash back you've earned at the end of your first year, automatically. There's no signing up. And no limit to how much is matched.

For example, if you earned $500 in rewards, Discover will give you another $500 in cash back at the end of your first consecutive 12 months of being a cardholder. For folks who plan to do a lot of spending on the card during that time, this unusual offer could prove incredibly valuable.

Introductory 0% APR period

The Discover it® Cash Back offers plenty of breathing room for paying off balances after opening the account. It comes with a generous introductory offer: 0% APR for 14 months on purchases and balance transfers, and then the ongoing APR of 13.49% - 24.49% Variable APR. The balance transfer fee is an introductory 3% of the amount transferred, but can be as high as 5% on future balance transfers (see terms). That's on par with other balance transfer cards. (For folks who need more time to pay off a balance transfer, consider going with its sibling card, the Discover it® Balance Transfer, instead.)

If you want to make a large purchase and pay it off over time, this is an especially valuable perk. Just keep in mind that if you're using the card as a balance transfer option, you'll likely want to avoid making new purchases with it, and instead use the card solely for paying off debt. That might mean missing out on the rich sign-up bonus offer.

Discover it® Cash Back vs. Chase Freedom®

Looking at cards that offer 5% cash-back rewards on rotating quarterly categories? Chances are the Chase Freedom® has been on your radar, too. At first glance, this card seems like a mirror image of the Discover it® Cash Back. But if you look a bit closer, a few important differences stand out.

What these cards have in common:

  • 5% cash back in rotating quarterly bonus categories on the first $1,500 in purchases each quarter. All other purchases earn 1% back.

  • A variety of bonus categories. Historically, they’ve ranged from broad options like restaurants and gas stations to specific retailers like Walgreens or Amazon.com. Past bonus categories can help you see what types of categories to expect in the future.

  • Requirement to activate quarterly categories.

  • No annual fee.

What's different about the Chase Freedom®:

  • Sign-up bonus can be earned quickly: Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening. (With the Discover it® Cash Back, you have to wait until the end of the first year to get your bonus.)

  • Slightly longer introductory 0% APR offer: 0% APR for 15 months on purchases and balance transfers, and then the ongoing APR of 16.49% - 25.24% Variable APR.

  • Rewards can be earned retroactively if you activate the categories by the 14th of the third month of the quarter; this is not the case with the Discover it® Cash Back.

  • Bonus categories aren't announced all at once: Unlike eligible Discover cards, the Chase Freedom® doesn't reveal its full slate of quarterly bonus categories for the entire year. Category announcements come only a couple of weeks before the start of a new quarter, which can make it harder to plan purchases.

  • It charges foreign transaction fees.

For more information about how these cards differ, read NerdWallet's article comparing the Discover it® Cash Back and the Chase Freedom®.

Why you might want a different card

The Discover it® Cash Back isn’t the best fit for everyone. Here’s why you might want to look elsewhere.

other cards offer simplicity

With rotating bonus categories that require quarterly activation, the Discover it® Cash Back is a relatively complicated card. If you want something more straightforward, try the Citi® Double Cash Card – 18 month BT offer.

This card offers an impressive 2% cash back on everything — 1% back on purchases and 1% back when you pay them off. With it, you can rake in big rewards for everyday spending without having to mess with bonus categories. Its annual fee is $0.

Choose a bonus category

With the Discover it® Cash Back, you don't have a say in which categories earn 5% cash back. With the Bank of America® Cash Rewards credit card, it's a different story. You earn 3% cash back in the category of your choice (from among six options); 2% cash back at grocery stores and wholesale clubs (on up to $2,500 per quarter in combine spending in the 3% and 2% categories, then 1%); and 1% cash back on everything else. For the 3% category, you can choose from gas, online shopping, dining, travel, drugstores or home improvement/furnishings, and you can change the category each month. The annual fee is $0. New cardholders can earn $200 online cash rewards bonus after you make at least $1,000 in purchases in the first 90 days of account opening.

If you want to see how these cards compare with other rewards cards, refer to our list of best credit card offers.

Should you apply?

If you prefer a no-fuss card, you might want to pass on the Discover it® Cash Back. But if you’re willing to put in some extra effort for top-notch cash-back rewards, it might be the perfect fit for you.

Frequently asked questions about the Discover it® Cash Back

Discover offers 5% cash back in bonus categories that change every three months. You must opt in (or “activate”) online to be eligible for the latest categories. Once you do, you get 5% cash back on up to $1,500 per quarter in spending in the bonus categories. All other purchases earn 1% cash back. The 5% categories include common expenses like grocery stores, gas stations, restaurants and Amazon.com. See current and past categories here.

There’s no limit to how much total cash back you can earn. The 5% rewards are limited each quarter, but even after you hit the $1,500 quarterly spending cap in those categories, you’re still earning 1%.

The simplest way to redeem cash back with Discover is to take the money as a statement credit. If you have, say, $30 in cash back, you can apply it to your account and reduce your balance by $30. You can also get your cash back as a direct deposit into a bank account, spend it on Amazon.com or via PayPal, or redeem it for gift cards.

Discover doubles the rewards you earn in the first year — but only in the first year. This is a special offer only for new cardholders.

You’ll need good to excellent credit to qualify for the Discover it® Cash Back. Generally speaking, this is defined as a score of 690 or better. But a credit score alone isn’t enough to qualify for any credit card. Issuers take into account your income, existing debts and other information.

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