The Greenlight Family Cash Card offers up to 3 percent cash back on every purchase, but there’s a catch. To get that market-leading payout, you need to spend at least $4,000 per monthly billing cycle. If you spend at least $1,000 but less than $4,000, you get 2 percent cash back on every purchase. If you spend less than $1,000 in that billing cycle, you only earn 1 percent cash back.

This is an interesting expansion for Greenlight, since this is a credit card targeted at parents. To date, Greenlight’s primary focus has been on debit cards for kids. For the most part, we’re probably talking about $5 or $10 allowance payments — nothing anywhere near the $4,000 per month threshold. But that’s a different audience. Now Greenlight is looking for parents to manage their own finances with the company. There are optional investing features as well.

This could be the most lucrative cash back credit card on the market if you spend $4,000 or more per month.

The competition

The USAlliance Visa Signature Credit Card gives 6 points per dollar on eligible grocery purchases and 3 points per dollar on everything else, but the elevated grocery rewards are slated to expire at the end of 2023 and the elevated rewards on other purchases are scheduled to expire at the end of this year. Each point is worth 1 cent toward a statement credit, so those rates equate to 6 and 3 percent cash back, respectively. The end dates have been extended previously, but if most or all purchases revert to just 1 point per dollar, that’s not nearly as appealing.

The Discover it® Miles card gives 1.5 miles per dollar on everything that cardholders buy. At the end of a new cardholder’s first year, Discover doubles all of those rewards for an effective 3 miles per dollar in year one. Each mile is worth 1 cent apiece when used to offset eligible travel purchases and also for other redemptions such as cash back and Amazon and PayPal purchases. So this is essentially a 3 percent cash back card for that first year, but then the rate gets cut in half in year two and beyond.

Besides Greenlight’s offering, the best cash back offer without a specified end date is probably the Alliant Cashback Visa® Signature Credit Card. It gives 2.5 percent cash back on up to $10,000 in purchases each monthly billing cycle (then 1.5 percent beyond the limit).

Greenlight’s core business

I like Greenlight’s offering for kids. They have a slick app that includes features ranging from allowance tracking to setting savings goals and even investing. Parents can set spending limits and monitor their kids’ financial activities.

While it’s probably best to start teaching very young children about money using tangible objects such as bills and coins, I think it’s critical to teach teens and tweens about how to manage money electronically. Transacting with plastic and apps is different than handling physical money. Digital payments can be so seamless that some people overspend without realizing it. It’s important to learn these lessons when you’re young and the stakes are lower. Greenlight is a good learning tool.

The only thing I don’t like about Greenlight’s debit card for kids is the price tag. Plans start at $4.99 per month and run all the way up to $14.98 monthly. The higher tiers include additional features such as enhanced rewards, priority customer service, purchase protection, identity theft protection and family location sharing. I understand that Greenlight is a business that’s looking to make money. And they are offering some interesting features. I just don’t think I’d spend $60 to $180 per year to manage my kids’ finances, especially since Chase has a similar offering that’s free.

It’s important to note that you need to pay one of these monthly fees to be eligible for the Family Cash Card. Even though the credit card doesn’t technically charge an annual fee, in practice, this membership subscription essentially serves as an annual fee by a different name.

If you spend exactly $4,000 with the card every month, you would earn $1,440 in rewards. Subtracting the lowest membership fee ($4.99 per month) would offset about $60 worth of rewards. You would be left with an effective 2.875 percent return on your spending. That’s still more than you would earn on the aforementioned Alliant card, and the gap would grow the more you spend.

The bottom line

Greenlight’s credit card is a compelling offering for cash back enthusiasts. In addition to the generous payout that can return as much as 3 percent on everything you buy, there’s an optional auto-investing feature that can hopefully turn your rewards into even more money via stocks and exchange-traded funds. This could jumpstart a college savings fund or help you work toward other financial goals.

I’m impressed that Greenlight continues to expand its suite of products and services. With more than five million users and a valuation north of $2 billion, this is a rapidly growing financial technology company that wants to help you and your kids build a better financial future.

Have a question about credit cards? E-mail me at ted.rossman@bankrate.com and I’d be happy to help.