Banking •

November 9, 2022

Debit card rewards

Most debit cards do not offer rewards, but a handful of rewards debit cards do offer some perks. Here’s how they work.

Rewards on debit card

When paying for goods or services, most people reach for one of two options (besides cash, of course): a debit card or a credit card.

There are various schools of thought on the benefits of debit vs. credit cards. 

Credit cards often offer rewards, but they can lead to costly credit card debt. 

Debit cards don’t usually have rewards, but there’s no debt involved—and no effect on your credit score. 

Is there a friendly middle ground that offers the benefits of each? Perhaps! The rare rewards debit card offers perks for your everyday spending activities while avoiding the pitfalls of credit card debt. 

Here’s everything you need to know about debit card rewards. 

Debit vs. credit basics

The main difference between debit and credit cards is that debit cards allow you to spend your own money, while credit cards allow you to spend borrowed money. 

Debit vs

When you pay using a debit card, the funds are immediately debited (removed) from your checking account. If you spend more than you have available, the transaction might be declined—or it may go through but leave you with a negative balance and an overdraft fee. 

When you pay for something using a credit card, the transaction is added to your credit card account. The credit card issuer sends the actual cash to the merchant. You then pay off your credit card bill. If you pay it off in full before the due date, you won’t pay interest on your purchase—but if you carry a balance, you will pay interest. 

With a debit card, there’s no interest cost, no effect on your credit score, and no possibility of going into debt. The downside is that debit cards don’t typically earn rewards. 

Credit card use may affect your credit score. If you carry a balance, you can go into debt and end up paying a significant amount in interest. Many credit cards earn rewards, however, including airline miles and cash back. 

Do debit cards offer rewards? 

The vast majority of debit cards don’t offer any type of reward. However, there are a handful of rewards debit cards that do offer perks.

Debit cards with rewards

The reason most debit cards don’t offer rewards is quite simple: debit cards just aren’t as profitable for banks! 

When you make a purchase using a debit card, the bank may earn a very small fee (called an “interchange fee”). But they won’t charge you interest, which is the real money-maker for banks.

On the other hand, when you use a credit card, the bank earns an interchange fee and can charge you interest. Interest rates on credit cards are above 20%, on average, so this can be extremely profitable for banks. 

Because banks earn so much from credit cards, they can afford to offer rewards to customers. But with a debit card, there just isn’t as much of a profit margin to justify rewards. 

Credit card rewards vs. debit card rewards 

Even among the debit cards that do offer rewards, those rewards typically aren’t as lucrative as credit card rewards. Some debit cards also have other requirements in order to earn rewards, like keeping a certain amount of money in a checking account. 

A typical rewards credit card system might look like this: For every $1 you spend, you could earn 1 airline mile or 1–2% cash back, depending on the card. For example, a $100 purchase might earn you 100 Delta airline miles or $1–2 in cash back. 

Some credit cards have “tiered” reward systems, where spending in certain categories earns rewards at a higher rate. For instance, a card might earn 3% on restaurant purchases, 2% on gas, and 1% on all other purchases. 

Debit card rewards are usually some sort of point system, which can later be redeemed for rewards like gift cards or cash back. Other debit cards might offer a different reward style, like an increased interest rate on your savings. 

In general, the earning rate of debit card rewards is lower than that of credit card rewards. But remember, debit cards are typically free and don’t charge any interest. Credit cards offer better rewards but can end up costing you a lot of money depending on how you use them. 

Types of debit card rewards

There are a few different styles of debit card rewards. The specifics vary by program and bank. 

Types of debit card rewards

Keep in mind that some programs might have additional requirements. For example, a bank may require that you make a direct deposit each month or that you keep a certain minimum balance in your bank accounts. 

Here’s an overview of the various types of debit card rewards programs.

Cash back

Cash back debit cards offer cash rewards on every transaction you make. For example, a card might offer 1% cash back—meaning if you spend $100, you earn $1 in cash back rewards. 

These cards are fairly rare, as banks don’t have much incentive to offer such lucrative rewards cards. 


Points debit cards offer points rewards for every transaction you make. This might be a flat amount per transaction (e.g., 5 points per transaction), or it could be based on the dollar amount (e.g., 1 point per $1 you spend).

These points are added to your account automatically. Eventually, you can redeem them for various rewards. These rewards vary depending on the bank and rewards program, but they might include things like gift cards, cash back, or travel perks.

With these cards, you usually have to save up until you hit a certain threshold. For instance, you may need to accumulate 5,000 points in order to redeem them for a $50 gift card. 

Relationship rewards

Some banks offer “relationship rewards” for using a debit card. These rewards can look different from bank to bank and might include things like discounts on other banking products, exclusive access to certain products or services, or waived fees. 

For example, a bank may offer to waive monthly service fees if you use their debit card X times per month. Or, they may enter you into a prize draw when you use your card. Again, these details vary significantly depending on the bank. 

Higher APY on savings

Some banks may offer to pay you a higher annual percentage yield (APY) on your checking or savings account when you use their debit card. APY refers to the amount of interest you earn over one year on a deposit account.

For example, an account may pay 0.5% APY in interest by default. The bank may then offer to increase this APY to 1% if you use your debit card at least 10 times per month. 

Other perks

Banks and credit unions may offer various other perks for using your debit card. These could include waived ATM fees, bonus rewards, or prize drawings. You can find the details of a bank’s rewards programs in the fine print, which is often listed at the bottom of the bank’s website. 

What debit cards offer rewards?

Most debit cards don’t offer any rewards—but there are a handful that do. Here are some of the best options. 

Mos student debit card

If you’re a student, Mos might be the perfect solution for you. 

Mos debit card

Mos is a rewards debit card for students. But it’s much more than just that!

Mos is a student-focused banking solution that offers dozens of juicy perks. It offers help with finding scholarships, easy cash advances for when you’re short on cash, access to side gigs, and much more.

Plus, you can save when you spend with the Mos debit card. After picking your favorite spending category, you can earn points on every purchase you make in that category. You can then redeem those points for cash back rewards, which are deposited right into your account! 

Mos members also enjoy exclusive deals and discounts specifically for students. You can even work with a private advisor to help you navigate how to pay for college and save as much money as possible! 

Sign up today to see why Mos is trusted by more than 400,000 students nationwide. 

Local banks and credit unions 

Many smaller regional banks and credit unions offer rewards checking accounts and/or debit card rewards. The details vary by bank. 

Local banks

For instance, many credit unions participate in the Kasasa checking system. This program allows credit unions to offer perks to their members who use debit cards.

With Kasasa, the rewards often kick in when you use your debit card at least 12 times per month. Depending on the bank, this might qualify you for perks like:

  • Increased interest rates on your savings

  • Refunds of ATM fees

  • Cash back on your purchases

  • And more

Kasasa is a unique program because it’s independently run but has been adopted by various banks and credit unions throughout the nation. You can look at the websites of credit unions in your area to see which offer Kasasa Cash or Kasasa Cash Back accounts. 

Axos Bank Cashback checking

Axos Bank is an online bank that offers a cash back checking account. With it, you can earn up to 1% cash back on purchases you make using your debit card. 

However, there are some significant restrictions. For one, cash back is only offered on transactions that require a signature. This means online and in-app purchases won’t qualify, but something like a restaurant meal will. 

Also, certain categories are excluded. These include grocery stores, wholesale stores, supermarkets, and discount stores. These transactions won’t qualify for cash back, even if they require a signature. 

To earn cash back rewards, Axos bank customers must maintain a checking account balance of $1,500 or more. If the balance drops below this threshold, the cash back rate is reduced to 0.5%.

Discover Cashback checking 

Discover Cashback Checking is a checking account and debit card that offers 1% cash back on eligible purchases. It’s not currently accepting new customers, although Discover plans to reopen applications “soon.” Check back later for more details. 

Discover Cashback Checking offers 1% spending rewards on up to $3,000 in purchases per month. That means you can earn up to $30 per month in rewards just for making everyday purchases. 

The account does exclude certain categories, like peer-to-peer payments (e.g., Venmo) and loan payments. But all standard purchases made directly with the merchant should qualify. 

Bottom line

Most debit cards don’t offer rewards, but the few that do are certainly worth exploring! And while credit card rewards might seem tempting, remember that they’re only worthwhile if you pay your balance off in full each month. If you carry a balance and pay interest, you’ll pay far more than the rewards you earn are worth. 

If you’re a student, check out Mos. Mos is a banking service designed specifically for college students. Its debit card offers rewards, zero fees, and exclusive perks like help with finding scholarships, side gig opportunities, and much more. 

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