If you’re looking for a cash back credit card without an annual fee, you’ve likely considered the Discover it® Cash Back. This card offers up to 5 percent back on up to $1,500 in rotating category purchases each quarter when you activate the bonus category (then 1 percent), as well as 1 percent cash back on all other purchases.

In addition to offering cash back, there are other benefits like no annual fee, no foreign transaction fees and no fee or penalty APR on your first late payment (then up to a $41 fee for all late payments after that). If you want to know more about The Discover it® Cash Back benefits, here’s a guide that will help you understand the card’s offerings.

What benefits does the Discover it Cash Back offer?

One of the most popular benefits of the Discover it Cash Back is the ability to earn rewards on many everyday spending categories. In addition to earning cash back on purchases, the card features a welcome bonus, a lengthy introductory APR offer and consumer protection tools for cardholders. Here, we’ll go into more detail about the various benefits the card offers.


Earning rewards

The Discover it Cash Back offers 5 percent back on rotating categories when you activate the quarterly bonus category, up to $1,500 back each quarter. After you reach the $1,500 limit for the quarter, you’ll still earn 1 percent back on all other purchases.

The Discover 5 percent cash back calendar outlines the bonus categories each quarter, and they tend to remain relatively the same. However, there have been some small changes over the recent year, so make sure you consult the calendar for updates to the bonus categories. In the past, bonus categories have included spending at grocery stores, CVS, Walgreens, gas stations, wholesale clubs, Uber, Lyft, streaming services, restaurants, PayPal, Amazon.com, Target.com and Walmart.com.

In addition to earning your 5 percent back on these spending categories for up to $1,500 per quarter, you’ll get a welcome offer with this card. Instead of a traditional welcome bonus that requires you to meet a minimum spending requirement, Discover will match all the rewards you earn in the first 12 months with its Cashback Match program.

So if you max out the bonus spending at $75 cash back per quarter, you’ll earn $300 in cash back for the year, plus another $300 from the Cashback Match for a total of $600 worth of rewards for the year. Don’t forget: you could also earn 1 percent back on other purchases once you max out the bonus category spending, which means you could earn an even larger welcome bonus your first year.

Redeeming rewards

Once you start racking up Discover rewards, you can redeem them in the way that suits you best such as: cash deposited in a bank account, a statement credit, gift cards, charitable donations to select charities, or even payments toward Amazon.com and PayPal.com checkout purchases.

Introductory APR

Another neat benefit of the card is the 0 percent introductory offer for 15 months which includes purchases and balance transfers. After the 15 months period ends, then you’ll have a pretty low 13.49 percent to 24.49 percent variable APR. There is an intro balance transfer fee of 3 percent, but it can increase to 5 percent on future balance transfers on your Discover card (see terms).

No fee for the first late payment

Normally, if you make a late payment on a credit card, there are consequences. The card issuer could charge a late fee, a penalty APR or both. With the Discover it Cash Back card, there’s no penalty APR for late payments and no penalty fee for the first time you make a late payment. Discover charges up to $41 fee for all late payments after that.

Other card benefits

Other card benefits provide some consumer protections for cardholders. Like most Discover credit cards, if your card is lost or stolen, Discover can freeze your card to prevent additional transactions like purchases and cash advances.

Also, if there are ever any unauthorized transactions or purchases on your card, with Discover’s $0 Fraud Liability benefit, you won’t be held accountable for those transactions. You can also opt into a service that monitors the dark web and malicious websites for your Social Security number.

Which cards are comparable to the Discover it Cash Back?

If you don’t like the idea of being materially involved in earning your cash back with the activation requirement for this card, you could compare the Discover it Cash back to the Discover it® chrome. The Discover it chrome offers similar features such as no annual fee, Cashback Match for the first year, a 0 percent introductory APR for the first 15 months (13.49 percent to 24.49 percent variable APR after that) and others.

Where the cards differ is their rewards structure. The Discover it chrome offers 2 percent cash back at gas stations and restaurants (on up to $1,000 in combined purchases each quarter, then 1 percent) and 1 percent back on all other purchases. However, there’s no activation required to earn your cash back in these spending categories.

The Discover it Cash Back can also be compared to the Chase Freedom Flex℠ as there are also rotating bonus categories that earn up to 5 percent back. Like the Discover it Cash Back, activation is required for these categories. The bonus categories for the Chase Freedom Flex include:

  • 5 percent cash back on activated bonus category purchases each quarter (up to $1,500 in purchases, then 1 percent)
  • 5 percent back on Chase Ultimate Rewards travel purchases
  • 5 percent on Lyft rides (through March 2022)
  • 3 percent on dining
  • 3 percent on drugstore purchases
  • 1 percent on all other purchases

Plus, there’s a $200 cash bonus after spending $500 within your first three months and a 0 percent introductory APR offer on purchases that lasts up to 15 months, with a 16.49 percent to 25.24 percent variable APR after that.

Which card you choose will come down to your personal financial goals, spending habits and how much effort you want to put into earning credit card rewards.

Should you sign up for the Discover it Cash Back card?

This card could do double duty if you are looking for a balance transfer offer with the opportunity to earn rewards—all without an annual fee. However, if you don’t like the idea of activating your quarterly bonus categories, it might not be ideal. If you neglect to activate those categories, you’ll forgo the 5 percent back on your spending and even reduce your first-year cash back match for your welcome bonus.

However, if you can remember to activate your bonuses, you stand to earn a higher-than-usual cash back rate on several different spending categories. As far as rotating bonus categories go, the Discover it Cash Back card is a great candidate and deserves serious consideration in your cash back credit card search.