The Bottom Line: The terrific rewards rate makes up for the lack of a sign-up bonus or a 0% introductory APR period.
Quick FactsView rates and fees
- Earn 2% cash back* on every purchase, no restrictions, no maximums, no rotating categories to keep track of
- No annual fee**, no foreign transaction fee**
- Redeem cash rewards right to your PayPal balance* at any time, use however you want. No thresholds or minimums
Pros & Cons
High rewards rate
No annual fee
No foreign transaction fee
Alternate Pick: Up to 5% cash back
Discover it® Cash Back
Higher rewards in quarterly bonus categories
Earn 5% cash back in rotating categories that you activate (on up to $1,500 per quarter in spending), and 1% on all other spending. 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. Annual fee: $0.Read our review
Finding a credit card that offers an unlimited 2% back or more on everything you buy is rare in the industry, but PayPal has one of the few offerings: the PayPal Cashback Mastercard®, issued by Synchrony Bank.
High flat-rate cash-back cards are enticing because they have the ideal combination of being simple and rewarding. No fussing with different rewards for different purchases or activating reward categories every quarter. And this one is free to carry, with an annual fee of $0.
You can use the card anywhere Mastercard is accepted, but the catch is you must have a PayPal account to apply. Applying is free, but it’s a potential hassle for people who have no interest in using the PayPal electronic payment service.
NERD NOTE: The PayPal Cashback Mastercard® is one of two co-branded PayPal credit cards. The other is the PayPal Extras Mastercard®, which has a different rewards structure. If you have one, you cannot get the other.
PayPal Cashback Mastercard®: Basics and benefits
Card type: Cash back.
Annual fee: $0.
Rewards: Unlimited 2% cash back on everything.
Sign-up bonus: None.
Foreign transaction fee: None.
APR: The ongoing APR is 22.24% - 29.24% Variable.
Where the PayPal Cashback Mastercard® shines:
Getting an unlimited 2% cash back on everything is simple and valuable, especially when the industry standard for flat-rate cards is 1.5% back. Other cards offer higher cash-back rates on certain types of spending, but very few have higher rates on all spending, especially with an annual fee of $0. There’s value in not having to devote mindspace to your credit card’s reward categories. Just using this card for everything is a fine plan.
No redemption threshold
Redeem your cash back in any amount. Some other cards require you to rack up $25 or more before you can cash in.
Use it almost anywhere
To be clear, you can use this card to pay for things via your PayPal account, but you don't have to make purchases that way. It's a regular credit card; it can be used in stores and online — everywhere Mastercard is accepted.
In most cases, once you're approved for this card, a temporary credit line will instantly be added to your account and you can start using it on PayPal immediately — you don't have to wait for a physical card to arrive in the mail. (That will take seven to 10 business days.)
PayPal Cashback Mastercard®: Drawbacks
You must have a PayPal account
This card is exclusive to PayPal members. When you click "Apply Now", you will be prompted to log in to PayPal. If you don’t have an account with PayPal, you will need to open one to apply. It's free.
Redemption is slightly limited
You have only two choices for getting your cash back: Redeem it to your PayPal account, or to your bank account or debit card linked to your PayPal account. This might not be a big deal for some people, but it’s more limited than other cash-back cards that allow you to apply cash back as a statement credit or get a paper check in the mail.
No sign-up bonus or intro APR rate
While the ongoing rewards rate is superior to most flat-rate cards, this card doesn’t give you a head start on accumulating cash rewards, unlike other options. It also doesn’t entice you with an introductory rate on balance transfers or purchases.
Synchrony Bank, the issuer of the PayPal Cashback Mastercard®, gets below-average ratings for customer satisfaction as measured by JD Power. In 2018, it ranked second-to-last among several major credit card issuers. This may or may not matter to you, depending on how often you typically interact with your credit card issuers.
High ongoing APR
If you’ll carry a balance monthly and pay interest, a rewards card like this might not be for you anyway. A low-interest or 0% APR credit card might work better. But it’s notable that APRs for this card trend higher than other cash back cards. The issuer notes that your APR, like with most issuers, is based on your creditworthiness and other factors and varies based on the prime rate. The ongoing APR is 22.24% - 29.24% Variable.
PayPal Cashback Mastercard®: Alternatives
The “other” PayPal credit card: The older of the two PayPal cards is the PayPal Extras Mastercard®. Despite its tiered rewards, this card’s drawbacks are high redemption minimums and low point valuation. For example, you need 6,000 points to redeem for $50, which is the minimum for cash-back redemption. That means a point is worth 0.83 cents. The industry standard is 1 point for 1 cent.
Other flat-rate cards: A big contender among flat-rate cash back cards with no annual fee is the Citi® Double Cash Card – 18 month BT offer. It gives you 1% cash back on every dollar you spend, then an additional 1% cash back for every dollar you pay off. There is, however, a minimum required redemption of $25.
The Fidelity® Rewards Visa Signature® Card is a straight 2% cash-back card, but to get that rate you must redeem earnings as a deposit into an eligible Fidelity account.
Among credit union cards, the Alliant Visa® Platinum Rewards earns 2 points per dollar spent on all purchases, but you must qualify to be a member of the credit union. One step up from that card is the Alliant Cashback Visa® Signature Credit Card, which earns an even higher ongoing rate — but there's an annual fee of $0 the first year, then $99.
Rotating categories: Some cards offer 5% back in bonus categories that change quarterly. In the past, categories have included useful areas of spending such as gas stations, restaurants and supermarkets. Good examples are the Chase Freedom® and the Discover it® Cash Back. Both offer 5% back in categories that you activate, on up to $1,500 in spending per quarter (equal to $75 in cash back), and 1% on all other spending.
Permanent categories: Other cash-back cards have bonus categories that don't change. The Blue Cash Everyday® Card from American Express is a good example. The card offers 3% cash back at U.S. supermarkets on up to $6,000 a year in spending (then 1%); 2% cash back at U.S. gas stations and select U.S. department stores; and 1% cash back everywhere else. Terms apply. It has an annual fee of $0.
NERD NOTE: For optimizers, the decision isn't choosing either a categories card or a flat-rate card, but both. Boost cash rewards by using a bonus-categories card to get higher earnings on certain purchases, and use the PayPal Cashback Mastercard® for everything else. Using the cards in tandem, you improve your cash back with only a little more effort.
Is the PayPal Cashback Mastercard® right for you?
If you already have a PayPal account and don’t mind redeeming cash rewards into it — or an associated bank account — you have cleared the biggest hurdles for getting and using the PayPal Cashback Mastercard®. The upside is a simple and valuable 2% unlimited cash back on all purchases that few other cards can match.
To view rates and fees of the Blue Cash Everyday® Card from American Express, please visit this page.
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