Cashback

Cashback is a mechanism where users receive a portion of their payment back after purchasing a product or using a service. Return methods include cash transfers, in-service balance credits, and points, with return rates typically ranging from 1% to 20%.

Unlike coupon codes that provide an "instant discount at the time of purchase," cashback is a "return after purchase." Due to this time lag, users need to pay the full amount upfront, but the returned amount can be used for future purchases, creating an ongoing cycle of savings.

Cashback can be broadly categorized into three types. The first is credit card purchase rewards; the second is campaign-based rewards from mobile payment services (such as PayPay and Rakuten Pay); and the third is a service's own cashback program.

Credit card reward rates typically range from 0.5% to 1.5%, while mobile payment campaigns can offer high return rates of 10% to 20%. However, high-return campaigns are usually time-limited and have return caps, so be sure to check the terms before participating.

Cashback and point rewards share a similar mechanism but differ in terms of flexibility. Cashback is returned as cash and can be used for anything. Point rewards, on the other hand, can typically only be used within the issuing service and may have an expiration date. If you value versatility, cashback has the advantage; if you frequently use a specific service, point rewards may offer better value.