Cash Back Reward Cards Are King

[jeffrey]

Cash is king in the credit card rewards programs these days. The latest example: Discover Card is kicking off a special offer of up to 10% cash back on restaurant meals charged to the card in September and October. The promotion follows a similar offer on grocery purchases made in April, May and June.

Discover pioneered cash-back rewards in 1986. Since then, others have followed. About 1 billion, or 25%, of all credit card solicitations last year involved cash-back rewards, according to industry tracker CardWeb.com. That's up from 700 million in 2002.

Cash is dethroning long-dominant airline rewards. One reason: "Finding free airline seats is harder with tighter inventories and more red tape," says Robert McKinley, CEO of CardWeb.

"A lot of people prefer cold, hard cash," says Roger Hochschild, president of Discover Financial Services. The three-month promotion on grocery purchases generated more than $20 million in cash-back rewards, he says... [read more at usatoday.com]