Most Common Mistakes People Make with Cashback Credit Cards in the UAE

By PolicyBazaar
  | Published: 15 July 2021 | Last Updated On: 20 July 2021
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Nothing compliments your financial needs like a cashback credit card. Do not have enough money to buy that expensive watch? Need to pay utility bills at the end of the month? Use your cashback credit card!

What does Cashback Mean for Credit Cards?

Your cashback credit card not only lends you money but also gives you cash back on your purchases. A cashback credit card rewards your spending by providing cashback on numerous purchases. Cashback is a way you can earn money on your spends through your cashback credit card. Besides, whenever there is a financial need, a cashback credit card is your best friend. You can share all your deep and dark shopaholic desires with your cashback credit card. Not only your cashback credit card fulfills those desires but also gives you cashback so that you pay less and save more. However, when the bill comes, a credit card becomes the source of evil in your life. Making mistakes while using your credit card can deteriorate your sweet relationship with your credit card. You can strengthen and deepen your relationship with your credit card by avoiding these mistakes. To completely understand these mistakes, it is important to understand the functioning of a cashback credit card.

How do Credit Cards Make Money on Cashback?

You must be wondering, how do cashback benefit credit card companies? Doesn’t the cashback rewards cost the credit card companies? Let us tell you how the cashback credit card works. When you use a credit card to purchase an item from a merchant, the merchant is required to pay a pre-specified percentage of the transaction to the credit card company. Through the cashback credit card, the company merely shares a small part of that fee with you. 

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Why do Credit Cards Offer Cashback?

Now lets us come to the bigger question, why do credit cards offer cashback. Through cashback offers, a credit card company gives you an incentive for using their credit card to make a payment. This incentive often stimulates users to use the same credit card for more purchases since you will be making more cashback money. This results in regular use of the credit card. The more you use a credit card, the more merchant fee a company earns. Therefore, the purpose of giving cashback is to earn more merchant fees.

Common Mistakes People Make with Cashback Credit Cards in the UAE

Now that you know how cashback credit cards work, let us point out some common mistakes so that you do not make those mistakes and make the most of your cashback credit card.

  • Lack of knowledge - Many cash back credit card users are unaware or oblivious to their credit card needs. Consequently, they purchase credit cards that are nothing more than money lending devices. However, with adequate knowledge about your expenses, you can convert your cashback credit card into a money-generating device. If you know that you require traveling to different places now and then, you should look for a cashback credit card that offers reward points or cashback on flight and hotel bookings. In case, you spend maximum money on groceries, you should seek a credit card that provides cash back on grocery shopping at supermarkets. To accomplish this task, it may be useful to make a list of monthly expenses and categorizes your monthly budget. This will allow you to understand your needs better and select the most suitable cashback credit card.
  • Falling for Cashback Scam -  Many cash-back credit card providers around the world have been found running cashback scams. These credit card providers offer cashback with dishonest retailers. In this, the cashier would include the cashback amount in the bill to make up for the cashback amount. Consequently, you end up paying extra money on an item to get the cashback. Whenever you are purchasing an item from a retailer online or offline, you are advised to check the bill and ensure that the cost of each item is matching the item mention in the list. Also, stay wide awake to point out any unwarranted charge. Doing so will allow you to get actual cashback with your cashback credit card.
  • Unaware of Capping -  When you sign up for a new cashback credit card, the credit card company gives you a fine print document stating the terms and conditions on the credit card. These terms and conditions clearly state the annual capping on the cashback credit card and the type of spend that gives higher cashback. However, most people sign the document without reading the terms and conditions carefully. As a result, they remain unaware of the capping of the cashback and end up spending more than the limit in a bid to earn cashback. You are suggested to know about the capping and types of cashback and spending benefits offered by your cashback credit card to make the most of it.
  • Taking Cash Advancement - Many credit cards offer the facility of borrowing cash in advance from an ATM to meet your extraordinary needs. Though this facility gives you extra cushion while making cash payments, it costs you more money since the rate of interest on the cash advance is usually higher. Besides, you do not receive any rewards or cashback on cash advancement. This means that irrespective of the amount you spend on your cashback credit card, you will not receive any benefits.
  • Improper Redemption - Yes, you received rewards and cashback but have you redeemed them? Not redeeming cashback is one of the most common and costliest mistakes you can make as a cashback credit card owner. It is not enough to just receive the cashback. If you do not put that cash back to use, you will never realize the true power of your credit card. Without use, it is as good as the boat on the land.
  • Waiting too long - Oh, I will use this cashback for the ‘right time'! There is no ideal time to use your cashback. On numerous occasions, cashback credit card owners lose their cashback because they wait too long to redeem the cashback. The cashback on your credit card expires in some time. You should be cognizant of the expiry date and ensure that you redeem the points before the expiry dates. You can also scroll through various online platforms to check where you can the cashback in the best manner possible.
  • Missing Bill payments regularly - Understandably, there are times when you may not be able to pay your credit card bills in time. The bank does not mind late payments since you will be paying the late fee payment as well. However, do not make a habit out of it. When you miss your cashback credit card bill payment for two months consecutively or you often miss your bill payments, the bank cancels the cashback earned by you over time. Irrespective of the time or the amount, the bank will cancel cashback and all your hard-earned cashback will be irredeemable.
  • Not Meeting the Minimum Spend Requirement - When you purchase a cashback credit card, the bank informs you about the minimum amount you need to spend to become eligible for cashback offers. Often people forget about these minimum spending limits and lose all the potential benefits. For instance, let us say that you are holding a credit card that gives you 50% cashback on a food bill of at least AED 100. When you ordered food, you forgot about the limit and ordered food worth AED 85, you will lose on the cashback. Now, had you ordered food of AED 100, you would have received AED 50 cashback which means that you would have paid only AED 50. However, now you will end up paying AED 35 extra. 

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Believing that all credit cards are the same - “All credit cards are the same”, is one of the most common myths among cashback credit card users. However, the truth cannot be farther from this. In reality, every credit card is different from the other. The cashback reward style of these cards may vary as well. For instance, one credit card might be rewarding you points that have a value of AED 0.5. On the other hand, another credit card might be giving you a cashback of AED 1.

Credit cards with Cashback in the UAE

Some of the best credit cards with cashback in the UAE are:

FAB Cashback Credit Card

FAB Cashback Credit Card

Cashback
  • Minimum Salary AED 5,000
  • Annual Fee AED 315
  • Cashback
  • Airport Lounge Access
  • Movie Discounts
  • Travel Discounts
  • Hotel Discounts
Reward Value: NA
  • AED 300 cashback on joining
  • Up to 5% cashback on supermarket and fuel spending
  • 10% cashback on global online stores
  • Cheapest movie tickets at Reel Cinemas, Oscar Cinema, and Cine Royal
  • 20% discount on Careem Chauffeur Services
  • Buy one get one offers on over 900 stores in over 90 countries
  • Credit Shield
  • Wallet Protection
  • MasterCard offers
  • Complimentary Access to Airport Lounges
  • Exclusive offers on AVIS
  • 15% off on your stay at a luxury serviced apartment

Emirates Islamic Cashback Plus Credit Card

  • Up to 10% cashback on education, dining, groceries, and telecom
  • RTA Benefits
  • Free Access to Airport Lounges
  • Golf Privileges
  • Cash on-call facility
  • Extended Warranty
  • Purchase Protection
  • Free Reel Cinemas Movie Tickets
  • Multi-trip Travel Insurance
  • Easy Payment Plans
  • Medical and Legal Referral
  • Balance Transfer Facility
  • 15% discount on Emaar Entertainment park-Dig It, Ekart, Ice Rink, The Dubai Fountain Boardwalk, VR Park, and Kidzania

ADIB Cashback Visa Platinum Card

ADIB Cashback Visa Platinum Card

Airport Lounge Access
  • Minimum Salary AED 10,000
  • Annual Fee AED 1,000
  • Airport Lounge Access
  • Free for 1st year
  • Dining Discounts
Reward Value: AED 5,640
  • 1% flat cashback
  • Complimentary Roadside Assistance
  • Cash Withdrawal up to 100%
  • Interest-free days up to 55 days
  • Up to four free supplementary credit cards
  • Free Access to Aiport Lounges

Najm Platinum Cashback Credit Card

Najm Platinum Cashback Credit Card

Free for Life
  • Minimum Salary AED 7,000
  • Annual Fee Free for Life
  • Free for Life
  • Movie Discounts
  • Golf Benefits
  • Special Discounts
Reward Value: AED 4,680
  • Free for life
  • Contactless Payment
  • Discounts on movies
  • Exclusive discount offers

Mashreq Cashback Credit Card

  • No annual capping on cashback
  • Free for life
  • 5% cash back on dining
  • 2% cashback on international spends
  • 1% cashback on domestic spends
  • Access to DragonFly and Dine program
  • Access to Visa Mena offers
  • Deals on shopping and entertainment
  • 20% cashback on Zomato and Netflix for 6 months
  • Easy Payment Plan
  • Easy Installment plans
  • Travel Easy
  • Access to Visa offers

Citibank Cashback Credit Card

  • No Annual Fee
  • Citi World Privileges
  • Cash Withdrawal
  • Easy Installment Plans
  • Up to 3% cashback

Emirates NBD Visa Infinite Credit Card

  • Higher Reward Points
  • Unlimited Complimentary Access to Airport Lounge
  • Complimentary access to Golf courses
  • Concierge Desk
  • Airport Transfers
  • Complimentary Valet Parking
  • Airport Dining Discount Program
  • Avis Car Rental
  • Medical and Travel Assistance
  • Worldwide Customer Assistance Services 
  • The Entertainer
  • Bicester Village Shopping Collection
  • Concierge Digital Services
  • Contactless Payment
  • 6-12 Monthly Easy Installments
  • Pay low interest for your purchases
  • Auto-Salik Top-up
  • Utility Bills
  • Discounts on flight and hotel tickets
  • SMS Alert
  • Round the Clock Assistance 
  • Online Access
  • Double Security
  • Multi Travel Insurance
  • Fraudulent Card Misuse Protection
  • SkyShopper

RAKBANK Titanium Credit Card

  • Up to 5% cashback
  • Up to 50% cashback on cinemas
  • Free for Life
  • Low-interest rate
  • Extended interest-free days up to 55 days
  • Complimentary Credit Cards
  • Cash Advance up to 80%
  • Buy one get one offers on purchases
  • 20% off on first three rides with Uber
  • Up to 30% off at 2,000+ restaurants

HSBC Cashback Credit Card

  • Up to 10% cashback on daily spends
  • Cashback every month
  • 0% interest on balance transfer up to 24 months
  • No maximum capping on total cash back earned
  • Buy one get one on VOX cinemas
  • 1000s of discounts and benefits
  • 12 complimentary visits per year to over 1,000 airport lounges
  • Free 2 Airport Transfers per year 
  • Complimentary travel insurance cover
  • Round the clock concierge services
  • Fraudulent card misuse protection

 Standard Chartered Visa Infinite Credit Card

  • Bank Priorities
  • Unique Rewards programs
  • Complimentary Access to Airport Lounges
  • Priority Pass Membership
  • International Insurance
  • The Good Life program
  • Supplementary Credit Card
  • Secure Online Transactions
  • Digital Payment
  • Online banking and Standard Chartered Mobile App