Should I get a Miles or Cashback Credit Card for Online Spending?

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“Which credit card should I be getting to maximise my online shopping benefits?”

Ah, that age old question that comes up as often as “should i marry this person?”

While we can’t help you with finding the right life partner, fear not – here’s a short and sweet guide to optimizing your online card spend benefits and to soothe those sore thumbs you’ve got from all those OTP passwords you’ve been entering!

We’ll be comparing both miles-earning cards as well as cashback cards, while listing out all the relevant hoops which you’ll be made to jump through. We also assume you’re not the sort who simply just wants to stick to a general purpose all-in-one credit card (e.g. OCBC 365 card), but yearns for razors precision in maximizing your bang for each online buck spent.

Generally speaking, cashback cards require a form of monthly minimum spend requirement, as well as impose caps on the cashback earned (oftentimes for various specific categories). Miles-earning cards have lesser such requirements, though they involve a conversion service fee of around $25 to change your bank points into air miles each time. We’re not comparing annual fees and minimum income requirements for the purposes of this analysis. Without further ado, here goes!

Best cards for your online spending needs (as of Oct 2018)

Note: Cards with competing benefits owing to temporary promotions excluded from this comparison

CardOptimal Benefits Rate*Conditions / ExclusionsPoints Validity**
DBS Woman's*** World Card4 miles per dollar
(~6% cashback)
- Earns on gig economy apps (e.g. Grab, Deliveroo, Redmart etc.).
-Telco bill payments don’t qualify.
- No min. spend required to earn.
- Min. income S$80,000 per annum
1 year
($26.75 miles redemption fee)
OCBC Titanium Rewards4 miles per dollar
(~6% cashback)
- Non-shopping (e.g. travel, Grab, telco bills) online merchants don’t qualify.
- No min. spend required to earn.
- For Singaporeans & PR, Min. income S$30,000 per annum
- For Foreigners, Min. income S$45,000 per annum
2 years
($25 miles redemption fee)
Citi Rewards4 miles per dollar
(~6% cashback)
- Non-shopping (e.g. travel, telco bills) online merchants don’t qualify.
- No min. spend required to earn.
- For Singaporeans & PR, Min. income S$30,000 per annum
- For Foreigners, Min. income S$42,000 per annum
5 years
($25 miles redemption fee)
UOB Preferred Platinum4 miles per dollar
(~6% cashback)
- Non-shopping (e.g. travel, Grab, telco bills) online merchants don’t qualify.
- No min. spend required to earn.
- For Singaporeans & PR, Min. income S$30,000 per annum
- For Foreigners, Min. income S$40,000 per annum
2 years
($25 miles redemption fee)
DBS Live Fresh Card5% cashback- Min. monthly spend of $600.
- Non-online/payWave categories only yield a 0.3% cashback rate.
- For Singaporeans & PR, Min. income S$30,000 per annum
- For Foreigners, Min. income S$45,000 per annum

To optimize for best ROI, you’ll need to spend $200 on online spend (to attain $20 cashback cap), $200 on Visa payWave transactions ($20 cashback cap) and $200 on all other categories (e.g. telco bill payments, petrol in order to meet the $600 min. spend requirement.
n.a.
BOC Family Card****5% cashback- One of the rare cards which telco bill payments qualify for optimal benefits rate.
- Capped rebates for Online Spend ($30), Dining/Movies ($30) and Other Bonus Cat. ($40 incl. Telco bills, groceries and NETs FlashPay auto top-ups)
- Total overall minimum spend of $700 required.
- For Singaporeans & PR, Min. income S$30,000 per annum
For Foreigners, Min. income S$60,000 per annum

To optimize for the best ROI, you’ll need to spend not more than $600 on online spend (telco bills don’t qualify), not more than $300 on dining & movies, and not more than $800 on Telco bills, groceries and NETs FlashPay auto top-ups.
n.a.

*mpd = miles earned per dollar; c= cashback. Each mile is approximated to have a value of 1.5 cents per the always excellent analysis performed by the Mile Lion.

**though the bank points may expire in this stated time period, you can potentially extend their value by a further 3 years when transferring them into a frequent flyer program (e.g. Krisflyer miles last for 3 years from the month in which they are credited into your account.)

***Here’s a lifehack – even men can apply for it.

****Some short term pain needed as BOC only entertains manual mail/walk-in applications for their credit cards.

So here’s our TL;DR conclusion

If you are someone who:

  • Won’t meet the minimum total spend requirements imposed OR
  • Will qualify well in excess of the e-commerce cashback caps offered by the card on a regular basis (i.e. routinely spending more than $200 in online spend while on the DBS Live Fresh card)
  • Wishes to indulge in flying business class at least once in future (who doesn’t!)
  • Will at some point in the future buy an air ticket

Then a miles card will be perfect for you!

But if you’re someone who:

  • Has a lifestyle which makes hitting the spend requirements quite feasible
  • Wishes to obtain the benefits in cash right away, rather than in the form of miles for future enjoyment

Then a cashback card could fit your needs just as well too!

 

ONE LAST THING

Every now and then life presents you with a rare opportunity where you get to double-dip and gloat about it.

With RateX, on top of all those credit card spend rewards, you get to save even more money by having a Chrome extension seamlessly search for all applicable promo codes for you at participating merchants! Simply download the extension, and you’re off on your way to being a savvy double-dipper. What are you waiting for – try it today!

And if you’ve found this blog post helpful to your wallets, please like, subscribe and share it with your friends so that they can be double-dippers too!

 

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Also published on Medium.