Rewards credit cards have become so ubiquitous -- and their cash-back rewards so lucrative -- that it's become a common refrain that you're leaving money on the table if you don't have one. But amid all the talk of rotating categories, double rewards and sign-up bonuses, it's easy to forget a simple truth about rewards cards: Many people can't get them.
The truly premium credit cards -- those that provide solid cash-back rewards without an annual fees -- are typically reserved for those with very good credit, which leaves many people without an invitation to the cash-back party. And even if you've got good enough credit to qualify, you might decide you don't want to incur the temporary hit to your credit score caused by opening a new account.
Here's the good news, though: You don't need a credit card to get cash-back rewards. There are a couple of other options.
It Pays to Be Loyal
One is to join store loyalty programs, which usually provide combinations of members-only markdowns and cash-back benefits. CVS (CVS), for instance, has its ExtraCare card, which in addition to discounts also offers 2 percent cash back on most purchases, with the rewards disbursed on a quarterly basis. Safeway (SWY) offers 1 percent cash back on groceries, which can then be used to get as much as a dollar a gallon off your gas purchases. Neither requires you to sign up for a store credit card, so you can get these rewards regardless of your credit situation.
The downside is that retailers like Safeway and CVS are exceptions, not the rule: In general, if you want store-specific rewards, you have to sign up for a store credit card, which can be dangerous to your financial health, especially if you carry a balance.
Cutting Yourself in on the Commission
The other way to get rewards is to go through a website that offers cash-back deals.
These websites aren't selling products directly; instead, they're referring you to products sold on e-commerce sites. One example is FatWallet, which aggregates deals, sales and discounts. If you click on a deal or sale, you're first taken to an interstitial page informing you that you can get cash-back from FatWallet if you make a purchase at the retailer's site.
There's no credit check or extensive registration process: Just create an account with a username and password, and henceforth you'll get varying levels of cash-back when you buy something after following a link from FatWallet. How varying? Anywhere from 1 percent to 40 percent, depending on the destination site and what you're buying there. Most merchants offer between 1 percent and 5 percent; visiting Amazon via FatWallet, for instance, will get you 3 percent cash back, but only if you're buying from the shoe, automotive or Amazon Local departments.
A Win-Win Arrangement
It might sound too good to be true, but it makes perfect business sense for all involved. Online retailers want to encourage other sites to link to their products, so they give out referral commissions -- a cut of the sale to whichever site referred the customer. Sites like FatWallet take a percentage of that commission and give it back to the customer, and everyone wins: The online store gets a sale, the referring site gets a commission, and the customer gets some cash back.
(Rewards cards operate on a similar principle: Stores get a sale, banks get a portion of that sale in the form of a swipe fee, and customers get a cut of that fee.)
FatWallet isn't alone in providing cash-back rewards. There's ExtraBux, which promises up to 30 percent in cash-back deals; current deals include 8 percent cash back from GNC, which is on top of a 15 percent discount offered via coupon code. There's eBates, which says that it has earned members more than $100 million in cash back. Another is ShopAtHome, which currently offers 7 percent cash-back for select deals from Walmart. TopCashback, meanwhile, has a slightly different business model: It says that it passes 100 percent of its sales commission on to the user, instead making its money through Google ads.
These sites can offer even better cash-back rewards than credit cards, which usually offer a standard 1 percent cash-back across the board and 5 percent on certain rotating categories. The downside is that you're a lot more limited on where you can get that cash -- only certain online retailers participate, and those that do may restrict the offer to certain products.
Still, it's nice to know that people with poor or even nonexistent credit can still score cash back just by shopping via one of these sites. And keep in mind that they aren't just for the credit-challenged: If you use a rewards card to shop through a cash-back site, you're getting rewards from both parties.
Isn't it nice to get paid to shop?
Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.