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- I am considering replacing my credit card with a rewards debit card.
- The PointCard Neon is an attractive option due to its high point rate and benefits.
- The downside is its annual fee and lack of redemption opportunities outside of cashback.
- Read Insider’s guide to the best rewards credit cards.
One of my biggest financial goals in 2022 is to break away from my credit card after sticking to just one personal credit card for over six years. I’m not only eager to find a new credit card with better rewards and benefits, but I’m open to diversifying and exploring options that are very different from the airline credit card I currently have.
That’s why when I recently heard about a debit card that offers the same type of rewards as a credit card, I decided to consider this as a potential option.
Although there are currently debit cards, such as the Discover Cashback debit account
or American Express® Cash Back Serve Prepaid Debit Card
that offer 1% cash back, PointCardwhich released in 2020, offers the chance to earn more rewards in popular categories and includes perks you don’t typically see on debit cards.
Thinking of using PointCard? Here’s what you need to know first.
What is PointCard?
14.99% – 23.74% Variable APR
good to excellent
PointCard is both a digital bank account and a debit card that offers unlimited cash back on qualifying purchases along with a host of credit card-like benefits. According to their website, applying only takes a few minutes and they don’t do credit checks.
Read more: Guide to the best online banks of 2022
Once registered, you will need to transfer money from another bank account or through a payment app to your Point bank account to use the card. You can also withdraw cash at any ATM using the card and receive up to $8 per month in ATM fee reimbursement.
What are the main advantages of PointCard?
Having a credit card may not be for everyone, especially if you’re looking to control your spending and avoid the threat of having to pay high interest on any balance you carry.
But if you’re still tempted to dip into the rewards that normally come with a credit card, PointCard might be a decent option.
Read more: Guide to the best cash-back credit cards in 2022
With the PointCard™ Neon, you can earn:
- 5x points on eligible subscription services (Netflix, Hulu, HBO Max, YouTube Premium, Spotify, Pandora, Feather, DoNotPay and Headspace)
- 3x points on qualifying rideshare and food delivery services (DoorDash, Uber Eats, Postmates, Caviar, GrubHub, Seamless, Instacart, Good Eggs, Uber, Lyft, and Lime)
- 1x points on everything else
If you spend a lot in the bonus categories of the card, you can enjoy slightly more rewards than you would earn with a standard cash-back debit card. However, with the PointCard Neon, you can only redeem the rewards as cash back.
While debit cards typically don’t come with the long list of benefits that some credit cards offer, PointCard does offer many of those same benefits, including:
Besides the rewards that come with this card, using a debit card can help you avoid going into debt, damaging your credit score with missed payments, and worrying about paying a monthly bill.
How to Redeem PointCard Rewards
PointCard Neon points are worth 1 cent each towards cash back paid directly to your account, with a minimum redemption of 100 points. The PointCard Neon only allows you to redeem your points for cash. However, the Titan version will also allow you to exchange your points for Bitcoins or transfer them to airline partners, but specific transfer partner details have yet to be released.
What are the disadvantages of using a rewards debit card?
While there are risks associated with getting a credit card, especially if you overspend and can’t pay off your monthly balance, there are some overall financial benefits that can’t be ignored.
For example, having a credit card and paying off your balance every month can help boost your credit score. Using a debit card will not impact your credit, which can be a disadvantage for someone looking to build or improve their credit.
Read more: How to build credit with credit cards and improve your credit score, whether you’re starting from scratch or already an expert
There are also so many different ways to redeem credit card points that debit card reward offers are missing, even the PointCard. Even if you’re not a frequent traveler, you can often use credit card points to pay off your balance, book future vacations (from hotel stays to rental cars), and even convert the points into credit cards. gifts for many different retailers.
Finally, while the PointCard offers some of the most robust rewards of any debit card available, it does have a catch. The PointCard Neon charges a fee of $99 per year or $9.99 per month with a minimum three-month commitment. The PointCard Titan will come with an annual fee starting at $399.
In the end, because I’ve spent years controlling my finances and managing my spending habits so that I don’t have a monthly balance, the benefits of having a credit card outweigh the benefits of use the PointCard.
Read more: I only use a credit card for my expenses – here’s why I never use a debit card or cash
However, if you are someone who wants to get a debit card with benefits as a back-up card to use, consider whether it is beneficial to pay an annual fee for the PointCard or whether to choose a standard cash-back debit card. cash, free of charge, meets your financial goals just as much.