3 Little-Known Perks of the Discover it® Cash Back Card

The Discover it® Cash Back credit card is a popular cash back credit card with one of the most lucrative welcome bonuses I've ever seen -- Discover will match all the cash back you've earned at the end of your first year. The card also earns 5% back on rotating quarterly bonus categories (up to $1,500 in quarterly spending) that you must activate before the quarter begins. In the past, these bonus categories have included groceries, restaurants, gas, Amazon.com, Target, Walmart, home improvement stores, among others.

While these headlining perks are pretty amazing, the card has several extras to get excited about. If you've had this card for a while (or are considering it), here are three perks you may not know about.

1. Special offers

Before I had my Discover it® Cash Back, I knew about the 5% rotating quarterly bonus categories. What I didn't know was that Discover would send me special offers for additional 5% bonus categories throughout the year.

For example, I'm currently earning 6% back at Amazon.com purchases on up to $1,000 spent on new purchases through June 30, 2024. That's $60 in cash back (or $120 if I still had my first-year cashback match). That's more cash back at Amazon.com than any of my other credit cards, including my Prime Visa. In the past, I've also gotten an offer for 5% back on groceries, which was on top of the normal 5% rotating bonus category at that time (restaurants and wholesale clubs).

Now, I don't know how Discover sends out these special offers, whether it does it equally across all accounts or gives them to only some cardholders. So, I can't say for certain that you'll get a special offer like these. But for every year I've been a cardholder, I've gotten at least one special offer.

2. Extra value on gift card redemptions

Most cardholders will redeem cash back for statement credits or cash deposits into their bank accounts. But, technically speaking, those options won't always give you the best value. In fact, though Discover doesn't advertise this frequently, you can add about 5% to 20% of value by redeeming your cash back for gift cards.

For example, you can redeem a $25 Instacart gift card with $23.75 of rewards, representing a 5% discount. Ditto for Amazon and Airbnb. Some gift cards will give you even higher valuations. Uber gift cards, for instance, come with a 15% discount. In other words, if you can get $20 of Uber gift cards for $17 of Discover cash back.

Of course, this works best when you're already shopping at these stores, and you're not getting a better value from another promotion. For example, redeeming my Discover cash back for an Amazon gift card would save me about 5%. But since my Discover it® Cash Back card is earning 6% back right now on Amazon.com, this wouldn't make sense for me. It doesn't quite work that way for every option, but it's something to keep in mind.

3. First late fee is waived

The Discover it® Cash Back card doesn't charge a fee for your first late payment. What's more, it also doesn't have a penalty APR. Since many of the best credit cards charge both a fee and a higher APR for late payments, that makes this card slightly more generous than others when it comes to missing a first payment.

That said, any late payments after your first will result in a late fee. While the card does come with a solid 0% intro APR offer on new purchases and balance transfers for 15 months, you might also pay interest for unpaid balances that are late.

To be sure, I don't think the Discover it® Cash Back is ideal for a one-card wallet. Its bonus categories are hit or miss, and the card's 1% base rate is low compared with the best cash back cards. But when it has some friends -- like a card that earns 2% back on every purchase -- it can make a great addition to your retinue of credit cards.