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What are Credit Card Rewards and How to Use them?

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October 12, 2022


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Of late, card issuing companies in India have begun to offer comprehensive credit card rewards programmes. Such rewards programmes are designed to lure consumers, like yourself, into using their credit cards to pay for products and services. One of the many advantages of credit card rewards is that there are different types ranging from cashback to reward points. The rewards you enjoy may vary depending on the card issuing authority and the kind of credit card you opt for.
Now that you've got the basics of this unique concept — let's look at it in more detail, along with a guide on using credit card reward points.

What are credit card rewards?

Credit card rewards are an incentive that card issuing companies offer for using their credit card to make payments. By offering these benefits, card issuers promote credit card spending.
Usually, three major kinds of rewards programmes come with credit cards - reward points programmes, cashback programmes, and air miles programmes. Continue reading to learn more about these three credit card rewards.

Reward Points 

It's the most popular type of credit card reward that most card issuers offer. Each time someone uses their card to make payments, it gives points — also known as reward points. The rate at which you accumulate these points tends to vary depending on the card issuing company and the type of card you opt for. Usually, entry-level credit cards offer fewer reward points per transaction than premium cards, which generally offer more points per transaction.
Also, many credit cards provide accelerated reward point accumulation on certain specific transactions.
Example: The Fi-Federal co-branded Credit Card, a reward-based card, provides accelerated Fi-Coins when you shop with any top brands on its catalogue. This credit card offers 5% valueback on your spending. Before we proceed, let's understand the term Valueback. Valueback implies the rupee value of the benefits you will receive. Using this card, you can get 5% or more of your annual spends. Now, let's break it down further:

5% = 2%  valueback + 3% milestone-based valueback

2% valueback breakdown

  • Up to 2% valueback through rewards
  • 5x rewards on the top 3 brands that you spend the most on
  • (Get 5 Fi-Coins on every ₹5 you spend. Also, the 3 brands need to be from the Fi collection of 21 top brands)
  • 2x on 21 major brands (India’s top brands, brands you spend on daily) listed in the Fi Collection (think Netflix, Amazon, Zomato, Uber etc.)
  • 1x on everything else (including rent & fuel)

3% milestone-based valueback

  • Additional 3% valueback when you hit milestones
  • Renewal fee waiver + vouchers (worth ₹2.5K) on ₹2.5L annual spends
  • Vouchers (worth ₹8K) on ₹4L annual spends

In short, by spending ₹4 lakh, you can receive more than ₹20K in benefits.

How to use credit card reward points?

As you've seen above, you get points (or, in this case, Fi-Coins) with every transaction you make on your credit card. Once you accumulate reward points, you can redeem them for exciting rewards like discount vouchers, free tickets, and more. All you need to do is log into your credit card account and navigate to the reward point redemption section.
Here, you can look at your accumulated total reward points and check out the various rewards on offer. You can redeem your points once you've determined the prize you want. In the case of a physical reward, it will be sent to the registered address. And if the credit card reward is a discount voucher or a coupon, it will be sent electronically as an SMS or email.


A specific category of credit cards offers cashback on particular transactions you make. Cashback is a refund (usually denoted as a percentage of the value of the transaction).
The amount of cashback you're eligible to receive depends on the credit card and the transaction you make. Also, most cards tend to cap the maximum amount of refund that you're eligible to get on a payment. However, a few cards offer cashback with no cap on the maximum amount.

How to use cashback rewards?

One of the advantages of opting for a credit card that offers cashback rewards is that you don't have to do anything to enjoy the benefit. Once the transaction is complete, the cashback automatically arrives in your account — without manual intervention.  
Here's an example to help you understand how cashback rewards work. Say you have a credit card offering a 5% cashback on all online payments. And that you use the card to make an online purchase worth ₹15,000. Once the transaction is complete, expect a cashback of ₹750 (₹15,000 * 5%). It will get automatically transferred to your account, usually in a few days, depending on the card issuer's terms. Thanks to this refund, your total credit card liability will decrease from ₹15,000 to ₹14,250.

Air Miles 

The third kind of credit card rewards offered by card issuers is air miles. Here, credit cards offer air miles for using your cards to make payments. The quantum of air miles you're likely to get may vary depending on the type of credit card you have and the transaction you make. 

For instance, say that you have a credit card that offers 10 air miles for every ₹200 spent on dining. When you spend about ₹4,000 on dining, you stand to receive 200 air miles on this transaction. 

How to use air miles?

As you continue using your card, you keep accumulating air miles. Once you reach a certain level, you can redeem the air miles for rewards like free air tickets, free hotel stays, or travel-related discount coupons. Example: The Fi-Federal co-branded Credit Card will soon let users convert the Fi-Coins they've accumulated by using the card into air miles!

The process you must follow to redeem your accumulated air miles is similar to using credit card reward points. However, details of most air mile-based rewards will be sent electronically via SMS or email.


With this, you must now have a comprehensive understanding of what credit card rewards are. Before getting yourself a rewards credit card, thoroughly review the entire list of features and benefits. This way, you can ensure that you opt for a credit card — more in line with your expectations. 

Fi Money: Unlock a World of Personalised Rewards with this Credit Card

Introducing the Fi-Federal co-branded Credit Card, where you can enjoy a 5% valueback on your spending. With this card, you'll be rewarded for every single one of your purchases, allowing you to personalise and customise your rewards based on your unique spending habits. From top brands to everyday expenses like rent and fuel, every transaction counts.
Plus, you have the freedom to convert Fi-coins into airline miles, cashback, bill reductions, or indulge in vouchers and merchandise. Enjoy additional perks like lounge access, forex benefits, flexible billing cycles, personalised reminders, and consolidated spend insights. With a nominal annual fee of ₹2k, you can apply for one, redeem a welcome offer worth ₹5k, and discover a credit card that's tailor-made to work for you.

Frequently Asked Questions

1. How can I apply for a reward credit card?

Reach out to our bank of choice, and if your credit history/score meets their requirements, you can get one. However, if you're looking for a card that will empower you with personalised rewards and flexible benefits as you embark on a journey to financial freedom, look no further than the Fi-Federal co-branded Credit Card. You can apply for one here.

2. What rewards can you get from a credit card?

Depending on the card you apply for, you can get three types of credit card rewards: cashback rewards, reward points, and air miles. If you have a Fi-Federal co-branded Credit Card, chances are you get all 3 types & more. You can convert Fi-coins into airline miles (coming soon), cashback, bill reductions, or indulge in vouchers and merchandise. Oh, and did we mention additional perks like lounge access, forex benefits, etc.


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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