It's one of the best flat-rate cash-back cards on the market — as long as you're willing to have and use a PayPal account.
No annual fee
High rewards rate
Must be a member/customer
No 0% intro APR
Foreign transaction fee
Compare to Other Cards
19.24%-29.24% Variable APR
17.24%-28.24% Variable APR
0% intro APR on Balance Transfers for 18 months
0% intro APR for 15 months on purchases and balance transfers
Recommended Credit Score
Recommended Credit Score
Detailed review: PayPal Cashback Mastercard®
Finding a credit card that offers an unlimited 2% cash back on everything you buy can be a great value. But adding a way to also earn 3% back on many purchases elevates the PayPal Cashback Mastercard® to a top tier among cash-back cards.
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. This card, issued by Synchrony Bank, isn't quite that simple because it has two rewards rates. But they're easy to remember, and the card is free to carry, with an annual fee of $0.
You’ll get an unlimited 3% cash back when you use the PayPal Cashback Mastercard® as the funding source for PayPal retail checkout. That alone would be decent. But you also get a value hammer: 2% back on all other purchases that accept Mastercard.
That's a winning combination of value and simplicity.
A minor catch is that to apply you must have a PayPal account, which is free.
PayPal Cashback Mastercard®: Basics
Card type: Cash back.
Annual fee: $0.
Rewards: 3% cash back on PayPal purchases, 2% back on all other purchases.
Sign-up bonus: None
Foreign transaction fee: 3%.
APR: The ongoing APR is 20.24%, 29.24%, or 32.24%, Variable APR.
» MORE: How does PayPal work?
Benefits and perks
This card has two different rewards rates, but they’re easy to remember: unlimited 3% cash back at PayPal checkout and 2% back on other purchases that accept Mastercard.
True, other cards offer higher cash-back rates on spending at certain places, like gas stations and restaurants. But 2% flat-rate cash-back cards have the benefit of being both rewarding and simple.
If you use this as your primary credit card, you’ll be earning 2% back for most purchases. But it’s worth noting when a retailer allows you to pay using PayPal, such as a PayPal button during online checkout. (You can also use it in-store when there’s a PayPal QR code available as a payment option.) Choose that, and you'll earn 50% more rewards (3% cash back).
A few examples of the many, many retailers that offer PayPal checkout: eBay, Zappos, Netflix and Etsy. Several travel companies also allow PayPal checkout, including Airbnb, American Airlines and United Airlines. A couple of American Airlines plane tickets totaling $1,000 would amount to $30 cash back with little effort.
Naturally, you must choose the funding source of the PayPal payment to be the PayPal Cashback Mastercard®.
You can also earn 3% back with the PayPal Cashback Mastercard® when you send money to another person via PayPal while using your credit card as a funding source. But when you use a credit card as a funding source through PayPal, you incur a fee. At this writing, the fee is 2.9% plus 30 cents per transaction. Factoring in the card's 3% rewards rate, you'd be close to breaking even.
As of this writing, authorized users cannot earn the 3% rewards rate because their cards can’t be added to a PayPal account.
Redeem your cash back in any amount. (Technically, you need 1 cent worth of rewards.) Some other cards require you to rack up $25 or more before you can cash in.
And you have access to your rewards every day without having to wait for a monthly statement cycle. Earned rewards will be available for redemption about three days after an eligible purchase.
Based on account type, customers can choose how to receive cash-back rewards — make credit card payments, transfer funds to a linked bank account or debit card, or just fund your PayPal account for other PayPal transactions.
Regarding the types of accounts, the card’s terms and conditions spell it out: If you have a PayPal Balance account, PayPal's version of a bank account, rewards can be used to make payments, make purchases, send money to other PayPal users or transfer to your bank account or debit card linked to your PayPal account. If you do not have a PayPal Balance account, rewards can only be transferred to your bank account or debit card linked to your PayPal account.
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, even if the retailer doesn’t accept PayPal at checkout.
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.)
Drawbacks and considerations
Need a PayPal account
You must have a PayPal account to apply. If you want a more traditional credit card from a major bank, consider the Wells Fargo Active Cash® Card.
This card offers an unlimited 2% cash back on all purchases and has an annual fee of $0. It also comes with a sign-up bonus: Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.
'Only' 2% or 3% back on spending
Earning 2% or 3% back on all spending is an excellent return among flat-rate cards. However, other cards offer even higher cash-back rates for spending at certain types of merchants. Here are some options.
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 Flex℠ 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 rewards cards have bonus categories that don't change. The Chase Freedom Unlimited® is a good example. It earns 5% cash back on travel booked through Chase, 3% back at restaurants and drugstores, and 1.5% back on other purchases.
Optimizers can boost cash rewards by using a bonus-categories card to get higher earnings on certain purchases, and using the PayPal Cashback Mastercard® for everything else (and PayPal checkout). Using the cards in tandem, you improve your cash back with only a little more effort.
No intro APR rate
The PayPal Cashback Mastercard® offers no promotional interest-rate offer for purchases or balance transfers.
If it’s a balance transfer you’re after, consider the longtime favorite among cash-back enthusiasts, the Citi Double Cash® Card. It gives you 2% cash back: 1% back on every dollar you spend, then an additional 1% cash back for every dollar you pay off.
Its promotional balance-transfer offer: 0% intro APR on Balance Transfers for 18 months, and then the ongoing APR of 19.24%-29.24% Variable APR.
However, it usually has no sign-up bonus and no 0% offer on purchases.
Although the Citi Double Cash® Card has not traditionally offered a sign-up bonus, the card currently has this offer in effect: Earn $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® Points, which can be redeemed for $200 cash back.
If you’re after an interest-free period on new purchases, consider the aforementioned Wells Fargo Active Cash® Card.
Its promotional APR offer: 0% intro APR on Purchases for 15 months and 0% intro APR on Balance Transfers 15 months from account opening on qualifying balance transfers, and then the ongoing APR of 20.24%, 25.24%, or 29.99% Variable APR.
Foreign transaction fee
It’s easy to recommend this card for nearly all types of transactions except one: purchases abroad. The card carries a 3% foreign transaction fee, which is not unusual for a cash-back credit card. But it means you’ll want a different card when traveling outside the U.S. or buying from foreign online merchants.
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: INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300. Annual fee: $0.
How to decide if it's 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 minor hurdles for getting and using the PayPal Cashback Mastercard®. The upside is a simple and valuable cash-back card that few other cards can match: an unlimited 3% cash back on PayPal checkout and 2% back on all other purchases that accept Mastercard. If you're still on the fence, check this list to find the best credit card for you.