Debunking Cashback Card Myths in 2026

Common Myths About Cashback Cards

Let's dive into some of the most pervasive myths about cashback credit cards and shine a light on what's really true. Whether you're a seasoned cardholder or just starting, understanding these misconceptions can save you money and maximize your rewards.

Rates and terms shown are representative. Your actual rate depends on your credit profile and circumstances. This is not financial advice — always read the lender's terms before applying.

Myth #1: No Annual Fee Means No Cost

Many people assume that a no annual fee card is the best choice. However, the reality is that these cards often come with lower cashback rates or caps on earnings. For instance, the CIMB Cash Rebate Platinum Credit Card offers no annual fee and up to 5% cashback, but it's capped at RM30 per month. If you spend heavily on groceries or petrol, a card with a higher annual fee but uncapped rewards might actually save you more in the long run.

Myth #2: All Cashback Cards Are the Same

It's easy to think that all cashback cards offer similar benefits. In reality, each card has its unique perks and pitfalls. Take the RHB Dual Credit Card, which combines credit and debit functions with 3% cashback on contactless payments. It's free for life, but there's a RM50 monthly cashback cap. This card shines for tech-savvy spenders who prefer contactless transactions.

Cards like these show that while no annual fees are attractive, they can limit your earning potential if you don't pay attention to the fine print. If maximizing cashback is your goal, consider cards that offer higher uncapped returns even if they come with fees.

Myth #3: Cashback on Everything

While some cards claim to give cashback on all purchases, they often have a lower rate for non-preferred categories. The Maybank myimpact Visa Signature gives up to 8% cashback on ESG categories but only 0.5% on others. This card is excellent for environmentally conscious consumers who align their spending with specific categories to maximize returns.

Myth #4: High Annual Fees Aren't Worth It

High annual fees can be daunting, but they sometimes come with perks that outweigh the cost. The Maybank Visa Signature Credit Card charges RM550 annually but offers 5x points on overseas spending, plus 5% cashback on domestic essentials like petrol and groceries. Regular travelers will find this card valuable, especially if they meet the RM30,000 annual spend waiver.

Myth #5: Cashback Is Better Than Points

Some assume cashback is the ultimate reward, but points can sometimes offer greater flexibility and value, particularly for travelers. If you fly often, a card that offers points convertible to miles might be more beneficial. The Hong Leong Wise Card provides a fixed 12.88% rate, but its weekend cashback and points conversion could be ideal for balancing interest savings with rewards.

While cashback offers immediate gratification, points might better suit those who plan for larger travel rewards. Understand your spending habits and goals before choosing between the two.

What Actually Matters

Cashback cards aren't one-size-fits-all. Consider your spending patterns, the categories you spend most in, and whether you're likely to hit caps or fall short of thresholds. Don't let myths guide your choice — look at the real numbers and benefits.