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Best Cashback Credit Cards in Malaysia

Cashback Credit Cards in Malaysia

According to the report, Malaysians are willing to spend more; hence, the number of credit cards in circulation is rising. Although Malaysian banks offer different credit card types, the cashback credit card is the go-to for eligible citizens. Malaysian cashback credit cards incentivize you to use credit cards and earn cash rebates from your spending rather than reward points.

However, banks have different cash back credit card terms and conditions, including a minimum annual income and specified lifestyle spending like retail purchases and online shopping. So, which is the best cashback credit card in Malaysia, and how much cashback does it get you? Keep reading to learn everything about cash back credit cards.

Cashback Credit Card – What is it, and how does it work? 

A credit card is a bank-issued line of credit that allows a cardholder to make contactless payments for goods and services within a pre-approved limit. Banks offer consumers different credit card types, including reward credit cards, like cashback credit cards.

Cashback credit cards offer you cash returns or a rebate on your monthly spending. However, you must meet bank eligibility criteria for receiving cashback credit cards in Malaysia.

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Eligibility For Cashback Credit Card Application in Malaysia

First, one government directive dictates that you must be at least 21 years old to apply for a credit card. Second, you must have a minimum annual income of RM 24000; fresh graduates and individuals retrenched from employment are ineligible for credit cards. Banks typically use your monthly salary to calculate your eligible credit limit.

Depending on your annual income, you can apply for multiple credit cards. Individuals with an annual income within RM24000-RM36000 are only eligible for a maximum of two credit cards, while those earning above the said limit can apply for more than two credit cards. 

Cashback Credit Card Terms and Conditions

Cash back credit card use is not universal because, aside from credit limits, banks set the terms and conditions for a cash rebate. Such conditions include specific spending categories like local spending (including online purchases), overseas spending on online shopping, retail spending in participating stores, and outdoor dining. Overseas transactions typically have a lower cashback rate than local spending.

However, you are only eligible for the cash rebate if you achieve the specified minimum spend for the month. Second, a bank may institute a rebate cap on refunds, regardless of your total monthly spend. 

For example, if the rebate cap or maximum amount is RM100, you cannot receive a cash rebate over RM100, even if monthly calculations exceed that amount. However, some banks offer unlimited cash rebates on their cards. 

Third, like with any other line of credit, you must make monthly payments or minimum payments due to clear the debt. Different cards have interest rates ranging from 8% to 15% per annum (p.a.). 

Other cash back credit card services with an interest rate include balance transfer, although the balance transfer interest rate is typically low; some banks even waive the fee. Also, some credit cards have an annual fee charge for benefits received.

However, you can receive an annual fee waiver from the second year of using your cashback credit card or consider applying for an annual fee-free cash back credit card. 

Cashback Credit Card Benefits

Making money off your recurrent expenditure is one of the many cash back credit card benefits. Depending on your bank and card type, you may receive other benefits, including supplementary cards and exclusive privileges.

Exclusive privileges include complimentary access to specific establishments and clubs, like the Plaza Premium Lounge.

Therefore, your credit limit and spending habits determine how much you stand to benefit from a cash back credit card. Also, a single bank typically has different credit card tiers, like a basic card, old credit card, or platinum card, to cater to different annual income brackets. 

Essentially, cash back credit card selection is not a one-size-fits-all affair. Therefore, follow the tips below to select the best credit card that aligns with your needs. 

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Points to keep in mind while selecting a Malaysia cashback credit card 

  1. Spending habits

Cashback categories vary for different credit cards. Such categories include groceries, fuel, retail, wining and dining, telco bills, and travel. Some cards only have rebates for select cashback categories, while others vary the rebate value for different categories.

Therefore, choose a card with high rebates in your normal spending category. For example, if you often travel for work or business, you should consider a card with high returns on air miles. Alternatively, consider a credit card that allows for easy funds transfer to your e-wallet if you shop online often.

  1. Spending requirements

Eligibility for a cash rebate depends on whether you fulfil stipulated spending requirements. Such requirements include a minimum spend for each month in each category, like retail purchases and online spending.

You must meet the spending requirement to receive the rebates. Therefore, ensure the spending requirements make sense.

  1. Rebate Cap

A bank may offer unlimited cash rebates, while others offer a rebate cap. A rebate cap is the maximum amount of cash refund you get on your spending, meaning every cashback your total monthly spend earns you above the cash rebate is null and void.

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  1. Annual fees

Some banks charge annual fees for credit cards. The advantage of cashback cards with annual fees is more benefits, including a higher cashback rate and point multipliers for the categories where you spend most of your money. Other perks include higher spending limits and access to exclusive spaces and services.  

Annual card fees in Malaysia range from RM60 to RM1000. However, you can opt for annual-fee free cashback credit cards, although such cards feature minimum benefits.

Moreover, you can apply for an annual fee waiver if you fulfil conditions like paying your fees on time for 12 consecutive months. A waived annual fee means you enjoy premium benefits without charges that negate your cash rebates. 

  1. Card Fees

Besides annual fees, other charges associated with a credit card include the finance charge on the interest rate on your credit card debt. The card issuer may also charge you cash advance fees for cash withdrawals from credit cards, late payment fees, and currency conversion fees. 

They may also charge you balance transfer fees for consolidating your credit card debt into one account. However, balance transfer fees are typically low. 

  1. Exclusive Privileges

Different card tiers in different institutions have different benefits. For example, a gold credit card has fewer benefits than a platinum card like a Visa platinum card.

Also, international credit cards like the World Mastercard, Visa Infinite, and Visa signature have more advantages, including priority banking. 

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What are the conditions and limitations on cashback? 

While cashback credit cards have multiple benefits, they are less flexible than other lines of credit. Below are the terms and conditions that limit cashback benefits.

  1. Eligibility

As stated earlier, active employment is a prerequisite for credit card eligibility in Malaysia. Moreover, your monthly or annual income determines how many credit cards you can have, hence how much credit you can access. 

  1. Spending Limit

The spending limits on cashback, such as minimum spend, mean you have to spend to earn.

  1. Cashback Categories

Although different cashback cards exist, finding a card with favorable rates on all your priority categories may prove challenging. However, consider applying for different cards for maximum benefit or a flat-rate card with equal cashback on all categories. 

  1. Rebate Cap

Rebate caps limit how much cashback you earn, and exceeding the set rebate cap negates your cashback benefits since you either don’t receive payment or receive cashback at a significantly lower rate for all spending past the cap.

Is there a minimum spend limit on Malaysia cashback credit card? 

Although most Malaysian banks and credit card institutions set a spending limit for cashback cards, the limit varies depending on the card type and the institution’s policies. Therefore, Malaysia has no standardized minimum spend for all cashback credit cards.

So, research the terms of the credit card to identify the spending limit that best suits your lifestyle.

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Top Cashback Credit Cards for Different Categories

  1. Citi CashBack Mastercard

The Citi CashBack Mastercard is an annual-fee free cashback card with an affordable payment plan. The card has a cashback rate of up to 10% on most categories, including petrol. Malaysians with a monthly income of RM3000 or more can apply for this cashback card.

  1. Maybank Islamic Mastercard Ikhwan Gold Credit Card

The Maybank credit card has a 5% cashback rate on all Shariah-compliant groceries and petrol. Moreover, you receive one Maybank treat point for each 1RM spent via the card; the treat points are redeemable for gifts on the Maybank catalog. 

Malaysians with an annual income starting from RM3000 can apply for this card. The annual interest rates for the card is 15%, depending on your credit limit and payment plan. 

  1. OCBC World Mastercard

The OCBC World MasterCard has multiple exclusive travel benefits, including a pass to KLIA Plaza Premium Lounge, and up to RM 2 million travel insurance.

You get 1.2% cashback on entertainment, groceries, shopping, and petrol and 0.6% cashback monthly when you subsequently spend more than RM 1,000.

Malaysians with a monthly income of at least RM8,3333 can apply for the card and receive an annual fee waiver for the first year.

  1. JustOne Platinum Mastercard

The JustOne Platinum Mastercard by Standard Chartered has competitive cashback rates of up to 15% on groceries and petrol. You get to enjoy an annual fee waiver on your first year.

Applicants should earn a minimum of RM36,000 p.a to qualify for the card.

  1. Alliance Bank Visa Signature

The Alliance Bank Visa Signature Card has up to 5% cashback when you spend on grocery, petrol, utilities, dining, and other retail spendings. However. your monthly spending should be RM2,001 to RM3,000.

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What are the different options for no annual fee-free cashback credit cards? 

Below is an overview of Cashback credit cards offering a lifetime annual fee waiver. 

  1. Citi Cash Bank Mastercard

The Citi Cash Bank Matercard offers an annual fee-free cashback plan where new cardholders receive an annual fee waiver for the first three years. Moreover, the card features a 10% cashback rate on groceries, petrol, dining, and other purchases. 

  1. Maybank 2 Gold Card

The Maybank 2 Gold Card has a lifetime waiver on annual fees, and cardholders receive a 5% weekend cashback and 5x TreatsPoints to be spent on weekdays with their second card, Maybank 2 American Express Card.

How can I calculate the cashback received from the credit card? 

The simplest formula for calculating cashback rebates received is C(Cashback)= P (Total Purchase Value) x C%/100 (Cashback rate).

However, you can use web-based cashback calculators; some banks have cashback calculator apps to make things easier.

When will I receive the cashback in my account? 

The cash rebate undergoes three vital steps before reflecting in your account. First is the transaction date for each purchase during a statement cycle, typically one month. 

Second is the posted date when the transactions reflect in your card statement, which should be at the end of the month/statement cycle. Third, your bank sends the rebate invoice to vendors who include the cashback requests on their invoices for the next cycle.

Therefore, your rebates should reflect in your bank at the end of the second statement cycle, which is approximately 60 days, depending on the time of the month you made the purchase.

How do I check it on my credit card statement?

Ideally, cashback rebates reflect on credit card statements as statement credits that reduce your card balance. The card balance is the total amount of debt owed to your bank for using a credit card as a line of credit.

However, you can ask your bank whether it offers different cash rebate payment options like bank deposits.

Which spending categories are eligible for a cashback? 

Petrol and groceries are the most common cashback categories and often have the highest rates. However, categories like dining, retail shopping, telco bills, and online shopping are also eligible for cashback.

Also, select cards feature less common categories like travel, utility bills, and insurance premiums. However, the same card may feature different cashback rates for different categories.

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Are supplementary cardholders eligible to receive cashback? 

Yes, any supplementary card holder with access to a primary cashback card can receive cashback on eligible purchases.

What does the term “Eligible Spend” mean? 

Not all product categories and transactions qualify for cashback. Therefore, an eligible spend is a cashback card transaction that qualifies for cashback.

Different cards have different eligible spending thresholds. For example, Islamic cashback credit cards exclude non-shariah-compliant purchases, like alcohol, within eligible spending categories like groceries and dining.

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Final Thoughts 

Cashback credit cards are a fantastic way to save while you spend. However, while all cashback credits utilize the same principle, different card issues have different policies.

Therefore, read the fine print and ensure you select a card(s) that aligns with your spending habits for maximum benefits.

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