Discover rewards program guide

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Discover offers a broad range of rewards credit cards that let you rack up points for travel, cash back and more. Their cards don’t charge an annual fee, nor do they charge foreign transaction fees for purchases made abroad. Discover even offers credit cards that help consumers build credit, including their award-winning secured credit card that offers cash back rewards.

The Discover card rewards program is easy to use, and that’s true regardless of which of their card options you choose. If you’re hoping to earn cash back, gift cards, statement credits or rewards for travel, keep reading to learn how the Discover rewards program works, which Discover credit cards fall under this program and how to use them.

How does the Discover rewards program work?

The Discover rewards program is extremely flexible, and that’s especially true when you consider all the different ways you can redeem your rewards. For the most part, Discover cash back credit cards let you accumulate rewards good for statement credits, cash back, gift cards and more.

You can also sign up for Discover cards that let you earn “miles,” although these miles work differently than airline miles. With Discover miles, you can redeem your rewards for any type of travel you want, then you just cash in your miles to cover the purchase after the fact.

What is the value of Discover rewards?

Discover cash back rewards are worth the exact dollar value offered in cash back. If your Discover cash back card lets you earn 1 percent back on all your regular purchases, for example, you would rack up $1 in cash back for every $100 you spend on your card.

Discover miles that you earn with a Discover travel credit card are also worth one cent each. This means if you rack up 10,000 in Discover miles, you can redeem them for $100 in travel purchases.

How does the Discover Cashback Match bonus work?

The Discover cash back bonus, which is also known as Cashback Match, is a program that lets you earn a delayed welcome bonus of sorts with Discover rewards credit cards. With the Cashback Match program, Discover will match all the rewards you earn in your first year as a new cardholder.

If you earn $300 in cash back during your first 12 months as a cardholder, for example, Discover would add another $300 to your rewards balance after 12 months. If you earned 35,000 Discover miles, on the other hand, Discover would match that amount to 70,000 miles after 12 months.

Who gets the Cashback Match bonus?

Generally speaking, everyone can earn the Cashback Match bonus on a Discover credit card. Just keep in mind that this bonus applies to new accounts, and rewards are only doubled or “matched” at the end of 12 months.

This means that if you already have a Discover credit card that’s more than a year old, you won’t be eligible for Cashback Match. However, you can apply for a different type of Discover credit card and be eligible for the matching funds on your new account after 12 months are up.

Best Discover credit cards for 2021

There are quite a few Discover rewards credit cards, all of which are geared toward different types of consumers. The following cards are some of Discover’s best options, and each one could be worth considering if you want to earn rewards without an annual fee.

Discover it® Cash Back: Best for cash back rewards

  • Rewards rate: Earn 5 percent back on up to $1,500 spent in activated rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on everything else
  • Eligible for Cashback Match: Yes
  • Cardholder perks: Intro APR offer, Social Security number alerts and free FICO credit score
  • Annual fee: $0

The Discover it® Cash Back lets you earn bonus rewards in popular categories as well as a standard rewards rate on everything else you buy. Specifically, you’ll earn 5 percent back on up to $1,500 spent in activated rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on everything else). Discover will match all the rewards you earn after the first 12 months, and there’s no annual fee and no fee the first time you pay your bill late.

As an added bonus, this card comes with a 0 percent introductory APR on purchases and balance transfers for the first 14 months, followed by a variable APR of 11.99 percent to 22.99 percent.

Pro tip: If you’re curious about which categories you can earn 5 percent back in right now, make sure to check out the Discover it Cash Back Bonus calendar for 2021.

Discover it® Miles: Best for travel

  • Rewards rate: Earn an unlimited 1.5X miles for each dollar you spend
  • Eligible for Cashback Match: Yes
  • Cardholder perks: Intro APR offer, Social Security number alerts and free FICO credit score
  • Annual fee: $0

The Discover it® Miles earns you 1.5X miles for each dollar you spend, and Discover will match all the miles you earn after your first 12 months through their Cashback Match program. Your miles never expire, and you can redeem them for travel purchases charged to your account or for statement credits or cash back.

This card doesn’t charge an annual fee, and you’ll qualify for an introductory 0 percent APR on purchases for 14 months, followed by a variable APR of 11.99 percent to 22.99 percent. There’s also an introductory balance transfer APR of 10.99 percent for 14 months from the date of the first transfer (also followed by a variable APR of 11.99 percent to 22.99 percent). (See Terms)

Discover it® Student Cash Back: Best for students

  • Rewards rate: Earn 5 percent cash back on up to $1,500 spent in activated rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on everything else
  • Eligible for Cashback Match: Yes
  • Cardholder perks: Intro APR offer, Social Security number alerts, free FICO credit score, awards for good grades and more
  • Annual fee: $0

Students who want to build credit should look into the Discover it® Student Cash Back, which lets you earn cash back rewards without an annual fee. This student credit card gets you 5 percent back on up to $1,500 spent in rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on other purchases (activation required). You’ll also see all your rewards matched after the first 12 months of account membership. There’s no annual fee, and you can even qualify for a $20 Good Grade Reward statement credit each year (for up to five years) if your GPA is 3.0 or higher.

Finally, new cardholders get an introductory 0 percent APR on purchases for 6 months as well as an introductory APR of 10.99 percent on balance transfers for 6 months (both followed by a variable APR of 12.99 percent to 21.99 percent).

Discover it® Secured Credit Card: Best for building credit

  • Rewards rate: Earn 2 percent cash back on up to $1,000 spent in combined purchases at restaurants and gas stations each quarter (then 1 percent) and 1 percent back on everything else
  • Eligible for Cashback Match: Yes
  • Cardholder perks: Social Security number alerts, free FICO credit score, no late fee on your first payment and more
  • Annual fee: $0

The Discover it® Secured Credit Card is one of the top secured credit cards on the market today since it lets consumers build credit and even earn rewards without an annual fee or hidden fees. This card lets you rack up 2 percent back on up to $1,000 spent in combined purchases at restaurants and gas stations each quarter (then 1 percent) as well as 1 percent back on everything else. Like other Discover cards, this card also qualifies for the Discover Cashback Match program that matches all rewards earned after your first 12 months as a new cardholder. You won’t pay an annual fee, and you’ll get a free FICO score each month.

Just remember that secured cards require you to put down a deposit as collateral, which is typically equal to the line of credit you qualify for. This means that you must be able to put down a $200 security deposit, and you’ll only start off with $200 in open credit you can use.

However, your security deposit is fully refundable if you close your account with a zero balance in good standing. Also, remember that Discover will automatically review your account after eight months to see if you’re eligible to upgrade to one of their unsecured card options.

Discover it® Business: Best for business owners

  • Rewards rate: Earn an unlimited 1.5 percent cash back for each dollar you spend
  • Eligible for Cashback Match: Yes
  • Cardholder perks: Intro APR offer, free FICO credit score and free employee cards
  • Annual fee: $0

Small business owners and solo entrepreneurs can consider the Discover it® Business Card for all their business spending. This business credit card doesn’t charge an annual fee, yet you’ll earn 1.5 percent cash back for each dollar you spend. Discover will match all the rewards you earn after the first 12 months, and you don’t have to pay a separate fee for employee cards.

You also get a free FICO score each month, and you’ll qualify for an introductory 0 percent APR on purchases for 12 months (followed by a variable APR of 12.99 percent to 20.99 percent).

How to redeem Discover rewards

When it comes time to redeem your Discover card rewards, you’ll find a wide range of options available to you. This kind of flexibility is helpful if you want to earn rewards but aren’t sure how you’ll use them or want to travel but don’t want to commit to a specific airline or hotel loyalty program.

Here are the redemption options you can choose from once you’re ready to redeem Discover card rewards:

Cash back

Get cash back deposited in your bank account at any time or opt for a statement credit on your account. This option lets you redeem your rewards however you want, whether you prefer to use rewards to cover regular spending and bills or to save them up for travel or some type of splurge.

Gift cards

You can also redeem your rewards for a wide range of gift card options starting at just $5. Many Discover gift card options also let you get more than 1 cent per point in value. Cardmembers can redeem their Cashback Match bonus for a physical or digital Partner gift card with 5 percent to 20 percent added value to each gift card (depending on the merchant). Partner gift cards range from $5 to $200 and come in increments of $5.

Pay with rewards

You can also use your rewards to pay for purchases directly on Amazon.com or for things you buy using PayPal. This opens the door to a broad range of possibilities, whether you prefer to use your rewards to cover household essentials like toiletries or home grocery delivery or want to save your rewards for a splurge.

Charity

Can’t decide how to use your rewards? Donate your rewards to a worthy cause or charitable foundation that partners with Discover.

Is the Discover rewards program right for you?

The Discover rewards program is a good option if you want to earn cash back and other rewards without having to pay an annual fee. Discover cash back cards are also popular among consumers who need to build credit or those who want a card geared specifically toward students or business owners.

However, there are other rewards credit card options to consider from different card issuers, including credit card rewards programs that let you transfer points to airlines or hotels or book travel through a portal.

If you want more options regarding redeeming your rewards, make sure to also check out other rewards programs like Chase Ultimate Rewards and American Express Membership Rewards.

Discover rewards program FAQ

Does Discover have a referral program?

Discover has a valuable “refer a friend” program that rewards current cardholders for inviting friends to join. Discover cardholders get a statement credit for each friend that becomes a card owner, and the friend also gets a statement credit when they make a purchase with their card within three months of account opening.

Discover notes that referral reward statement credit amounts range from $50 to $100 and that the “maximum annual referral amount will be stated in individual referral offers upon login.”

What are the Discover it Cash Back bonus categories for 2021?

Here’s a look at the 2021 Discover cash back bonus categories for the remainder of the year:

  • Q2: Apr. through Jun. 2021: Gas stations, wholesale clubs and select streaming services
  • Q3: Jul. through Sept. 2021: Restaurants and PayPal
  • Q4: Oct. through Dec. 2021: Amazon.com, Walmart.com and Target.com

What’s the best way to redeem Discover cash back?

Since rewards earned with Discover credit cards are generally worth one cent each, there aren’t any truly “outsized” redemptions to go after. You may get slightly more than one cent per point in value for select gift card redemptions, yet you should only pursue this option if you can use eligible gift cards to your advantage.

The bottom line

If you want a card that will reward you in some way for every dollar you spend without annual fees or complicated loyalty program rules, Discover’s offerings are hard to beat.

Before you dive in, make sure to compare all the best Discover credit cards as well as the best credit cards from all major issuers to find the perfect option for your needs and spending style.

All information about the Discover it® Business Card has been collected independently by Bankrate and has not been reviewed or approved by the issuer.

Written by
Holly D. Johnson
Author, Award-Winning Writer
Holly Johnson began her career working in the funeral industry, which may make you wonder why she works in personal finance now. Yet, the funeral industry taught the author everything she needs to know about the value of one's money and time. Johnson left the mortuary business a decade ago in order to explore her passion for personal finance and travel the world, and since then, she and her husband have built a debt-free lifestyle that has them on the path to retire very wealthy in their 40s. Holly's love of budgeting also led to the creation of her debt payoff book, “Zero Down Your Debt: Reclaim Your Income and Build a Life You’ll Love."
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