PayPal Cashback Mastercard® Review: No Annual Fee and Unlimited 2% Cash Back
Lyle is a writer specializing in credit cards, travel rewards programs, and banking. His work has also appeared on MSN Money, USA Today, and Yahoo! Finance.
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Considering PayPal didn't start out as a credit card company, it'd be easy to dismiss its entry into that world as just a gimmick. However, that's far from the truth, because the PayPal Cashback Mastercard® offers a cash-back rate that beats many of the best cash-back cards.
Big cash back and no annual fee can be a valuable combination, but before you decide to get this card, you should also know about the areas in which it doesn't quite measure up to the competition. In our PayPal Cashback Mastercard® review, we'll take an in-depth look at its pros and cons.
PayPal Cashback Mastercard®
Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.
This card doesn't offer a bonus or intro APR, but the unlimited 2% cash back makes up for it.
Credit Rating Requirement:
Get 2% cash back* every day, every purchase, every time you use your card. No exceptions. No rotating categories to keep track of.
Balance Transfers: N/A
21.49%, 25.49% or 28.49% variable
Bonuses & Perks
- Get 2% cash back* every day, every purchase, every time you use your card. No exceptions. No rotating categories to keep track of.
- Redeem Cash Rewards right to your PayPal balance** -- start enjoying your rewards today! No redemption threshold.
- Use your PayPal Cashback Mastercard to shop everywhere Mastercard is accepted. No purchase restrictions.
- ID theft protection
No annual fee: It won't cost you anything extra to get this card, because it doesn't charge an annual fee. That also means if you avoid interest charges by paying your balance in full, the rewards you earn from this card will be 100% profit.
Unlimited 2% back: This card has one of the best cash-back rates you'll find, earning 2% back on every purchase. There's no cap on that, either, so you'll continue getting the 2% rate no matter how much money you spend.
If you prefer to have flat-rate cash back that you earn on all your expenses instead of cash-back rates that vary by spending category, then the PayPal Cashback Mastercard® is an excellent choice.
No cash-back redemption minimum: You can redeem as little as $0.01 of cash back as soon as it posts to your account. Although this may not seem like a big deal, some cash-back cards have redemption minimums, such as $25, or let you redeem your cash back only in certain amounts. It's much more convenient when you can cash in what you've earned at any time and any amount.
No foreign transaction fee: Many no-annual-fee cards charge a 3% fee on any foreign transactions, which can add up if you travel abroad and use your credit card frequently. Because the PayPal Cashback Mastercard® doesn't have this fee, you can use it internationally without paying more. However, if you travel often, you're better off checking out travel rewards cards. The rewards and benefits those cards offer provide more value for frequent travelers.
Use your card upon approval: Once PayPal approves your application, you can start using the card through your PayPal account while waiting for it to arrive in the mail. What's nice about this is the fact that you don't need to wait to start earning cash back.
Mastercard benefits: This card has several extra benefits courtesy of Mastercard, most notably purchase protection, extended warranty coverage, and identity theft resolution assistance.
What could be improved
No sign-up bonus: One major weak point of the PayPal Cashback Mastercard® is that it doesn't offer a sign-up bonus. Credit cards with sign-up bonuses provide cardholders with much more upfront value.
No 0% APR offer: This card doesn't include a 0% intro APR on purchases or balance transfers, meaning you need to pay your bill in full every month from the beginning or you'll incur interest charges. While many cardholders won't need a 0% APR offer, this is a common feature among cash-back cards.
Limited cash-back redemption options: There are a few small annoyances with redeeming your cash back on this card. You can't set up automatic redemptions, so you need to spend time doing it manually. You also must redeem cash back to your PayPal account, and you can't use it as a statement credit. If you don't want to use your cash back through PayPal, you can transfer it from there to your bank account.
Neither of these is a huge issue, but they both make the redemption process more complicated than necessary. Automatic redemptions would save time for cardholders. Cash back you could redeem directly to a bank account or apply as a statement credit on your credit card bill would remove one step of the redemption process for those who don't want to use their cash back with PayPal.
Suggested credit score
A credit score of 670 or higher is recommended to apply for the PayPal Cashback Mastercard®. Like most of the top credit cards, it's intended for consumers who have good credit. Remember that credit card applications depend on more than just your credit score, so having a high score doesn't guarantee approval of an application.
You need a PayPal account to apply for this card. You can sign up for one online, and there's no fee to open an account. It should also be noted that if you already have PayPal's other credit card, the PayPal Extras Mastercard®, you can't get the PayPal Cashback Mastercard®. The policy is one PayPal-branded credit card per person.
This card is right for you if:
You'll love the PayPal Cashback Mastercard® if you want one cash-back card to use for all your expenses. Since flat-rate cards earn a respectable amount back on every purchase, consumers often find that they get the most cash back by using this type of card. And when it comes to flat-rate cards, the 2% cash-back rate on the PayPal Cashback Mastercard® ranks near the top.
The biggest issue with this card is that, besides the cash-back rate, it doesn't have much going for it. For example, there’s no sign-up bonus. And if you want a 0% intro APR, you won't find it here. The PayPal Cashback Mastercard® is fantastic for earning cash back on what you spend, but that's about it.