PayPal Cashback Mastercard® vs. PayPal Extras MasterCard®: Simple cash back beats complicated rewards

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In a Nutshell

When it comes to the two different PayPal credit cards, we prefer the simple cash back rewards offered by the PayPal Cashback Mastercard® over the PayPal Extras MasterCard®.

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With two PayPal credit cards now available, frequent PayPal users may be wondering which one to go for: the PayPal Cashback Mastercard® or the PayPal Extras MasterCard®?

If you have a PayPal account and are a regular user, the PayPal Cashback Mastercard® is our pick, with both better rewards and an easier way to redeem them. Here’s what you should know.

At a glance: PayPal Cashback Mastercard® vs. PayPal Extras MasterCard®

PayPal Cashback Mastercard® PayPal Extras MasterCard®
Annual fee None None
Sign-up bonus None None
Rewards 2% cash back on all purchases 3x points at gas stations and restaurants, 2x points on PayPal and eBay®  purchases, and 1 point for all other purchases
Rewards value 2 cents back per dollar spent 1 point is worth 0.83 cents when redeemed for PayPal account cash
Variable APR for purchases  16.99%, 24.99% or 27.99% 20.99% or 24.99%
Other benefits Redeem cash back into your PayPal account at any time, with no minimum threshold Redeem points for gift cards, merchandise, cash back or travel vouchers, depending on your point threshold

  1. The winner: Why we prefer the PayPal Cashback Mastercard®
  2. Counterpoint: Why you might want the PayPal Extras MasterCard® instead
  3. Heads up: What to consider when applying for a PayPal credit card
  4. Bottom line: Is the PayPal Cashback Mastercard® right for you?

The winner: Why we prefer the PayPal Cashback Mastercard®

The PayPal Cashback Mastercard® is an easy card to use and understand:

  • Earn 2 percent cash back on all purchases.
  • When you want to redeem your cash back, you can have it transferred straight into your PayPal account, with no minimum redemption threshold (this means you don’t have to earn a certain number of points before you can start redeeming your rewards).

All told, the PayPal Cashback Mastercard® makes for a refreshingly simple cash back card with a good rewards rate for regular PayPal users.

In contrast, the PayPal Extras MasterCard® offers a variable rewards rate by category. You can earn:

  • 3 points for every dollar spent at gas stations and restaurants
  • 2 points for every dollar spent at PayPal and eBay®
  • 1 point for every dollar spent on all other purchases

However, these points are much more complicated to redeem. Awards must be redeemed through PayPal’s online portal, and there are a number of restrictions. For example, hotel and air travel rewards must be requested at least 21 days in advance of travel.

You’ll also have to reach these minimum thresholds to earn different types of rewards with the PayPal Extras MasterCard®:

  • 2,200 points for gift cards
  • 3,000 points for merchandise from housewares to sports equipment
  • 6,000 points for $50 cash back, credited into your PayPal balance
  • 15,000 points for travel vouchers or airfare, hotels or car rental

Comparing cash back rewards with each card

The PayPal Cashback Mastercard® rewards rate is simple: It earns you 2 cents back into your PayPal account for every dollar spent.

The value of points from the PayPal Extras MasterCard® are trickier to calculate as they can be redeemed for gift cards, merchandise and vouchers as well as cash, and redemption values may vary for each.

When redeeming points from the PayPal Extras MasterCard® for cash, 6,000 points are worth $50 in cash credited to your PayPal account. This means that each point is worth 0.83 cents — or less than a cent each — when they’re redeemed for PayPal cash.

If you compare the two cards based on their PayPal cash back earning potential, the PayPal Cashback Mastercard® comes out on top in most scenarios:

Cents back per dollar spent with the PayPal Extras MasterCard® Cents back per dollar spent with the PayPal Cashback Mastercard®
On gas and restaurants 2.49 cents 2 cents
At PayPal and eBay® 1.66 cents 2 cents
On all other purchases 0.83 cents 2 cents

But remember, this comparison is just looking at the $50 cash back redemption option available once you earn 6,000 points with the PayPal Extras MasterCard®. Redemption values for other options, such as gift cards or merchandise, may vary.

Counterpoint: Why you might want the PayPal Extras MasterCard® instead

The 3 points per dollar you earn when you use the PayPal Extras MasterCard® at gas stations and restaurants are worth more than the flat 2 percent cash back earned by the PayPal Cashback Mastercard® (when you redeem the points for PayPal account cash back).

This means that if you’re mainly using this credit card for gas and restaurants and don’t mind the other redemption limits, the PayPal Extras MasterCard® can help you earn slightly more back than the PayPal Cashback MasterCard®.

Heads up: What to consider when applying for a PayPal card

For either of these cards, you’ll need a PayPal account to apply, and your card and rewards will only remain valid while your PayPal account is open. You can only apply for one of the two cards, but luckily for most, the PayPal Cashback Mastercard® is the clear choice.

You should also be aware that both of these PayPal credit cards come with a 3 percent foreign transaction fee. If you’re looking for a card to use outside of the U.S., you could be better off with a travel rewards card with no foreign transaction fee, such as the Bank of America® Travel Rewards credit card.

Bank of America® Travel Rewards Credit Card

From our partner

Another thing to consider when applying for a PayPal credit card is that neither the PayPal Cashback Mastercard® or PayPal Extras MasterCard® currently comes with a sign-up bonus.

If the idea of extra cash or points up front is appealing to you, it might make sense to explore cards with sign-up bonuses or wait to see if PayPal offers a sign-up bonus for one of these cards later.

The best credit card sign-up bonuses of 2017

Bottom line: Is the PayPal Cashback Mastercard® right for you?

If you’re looking for a simple flat-rate cash back card and have a PayPal account, the PayPal Cashback Mastercard® is one option for you. But if you’re not a frequent PayPal user or you’re looking for a cash back card that has the extra plus of a sign-up bonus, there are other options out there. Here are a few of our favorites:

At a glance: Cash back credit cards with no annual fee

Chase Freedom Unlimited® $150 bonus after you spend $500 on purchases in the first three months from account opening

Bank of America® Cash Rewards Credit Card

$150 online bonus after you spend $500 on purchases in the first 90 days of account opening

Blue Cash Preferred® Card from American Express

$200 statement credit after you spend $1,000 on purchases in the first 3 months

 


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