Debit Card Cash Back Rewards
Credit card companies offer cash back and other rewards to encourage you to use their cards. Why pay for that new computer with a plain ol’ MasterCard, when your First Municipal Cash Platinum Back Rewards VISA will give you $10 cash back? Unfortunately, the allure of a measly 1% rebate causes many people to rack up debts they wouldn’t have otherwise. How does it make any sense to earn a few percent cash back when paying double-digit interest on the balance? (It doesn’t.)
This is where the cash back debit card enters the equation. You get all the benefits of earning cash rebates on your purchases, without the potential for spending more than you can afford. In fact, the cash back debit card pays greater cash rewards than virtually any other rewards credit card.
Do you shop on eBay? If you do, you’re probably familiar with PayPal, the world’s largest person-to-person payment processing service. Paypal offers a cash back debit card that pays 1.5% cash back on all debit purchases. There are no minimums or spending tiers to qualify for cash rewards. In fact, unlike cash back credit cards, the rebates are posted to your account immediately. The card debits purchases from your PayPal account balance, effectively functioning like a “stored value” credit card. The PayPal debit card is a MasterCard issued by BankOne. The card can be used anywhere where debit cards or MasterCard is accepted.
You’ve sold me; how do I get one?
In order to qualify for a Paypal debit card, you must be a PayPal Premier or Business account member and a member of the Preferred Rewards program. Membership is free, and it only takes a few moments to sign up at the PayPal website. Once you sign up as a member, you can log into your account and request the debit card. It’s as simple as that!
How do I use the card?
- Sign up for a PayPal Premier or Business account and order your PayPal Debit Card.
- Register for the Preferred Rewards program.
- Transfer money electronically from your checking account to your PayPal account.
- Purchases made with the PayPal debit card are automatically debited from your PayPal account.
- Replenish your PayPal account balance when it runs low.
Earning cash back has never been so easy!
The 1.5% cash back reward for new PayPal members ended a long time ago, and the follow-up cash back reward was only 1.0%. Members that signed up and got the 1.5% rate was suppose to continue getting that rate.
I haven’t seen any other news of this, but it appears that PayPal is changing their rewards program again, and even hurting their early customers by instituting a tiered rewards program. You would only earn .5% (half a percent) cash reward on all purchases for the month up to 499.99. 1% for purchases of $500-$4999.99, and 1.5% for $5000+. Now, this change has just gone into effect on my account even though there is no legal documentation for the change yet. All links still show the flat 1% rewards offer. Since I WAS earning 1.5%, the tiers may be different for those who were earning 1%.
My evaluation of this is that it sucks. I have NEVER spent over $5000 in one month with my debit card, and therefore would NEVER be getting 1.5% cash back rewards again. I also sometimes didn’t spend $500 or more, so I would even have some months where I wouldn’t even earn the current 1% any more.
I hope there is some problem and that this gets resolved, as this sucks! I will be looking for a different card to do my purchases with if this turns out to be their official new offering.