Modern finance · 1950s–1990s
1986
Cash back
The Discover card pays cardholders a share of what they spend.
Sears launched the Discover card nationally in 1986 with no annual fee and a yearly 'Cashback Bonus' on purchases. Rival cards answered with points, miles and cash back, some paying more in chosen categories.
Rewards are paid from merchant fees and interest, so they only come out ahead for people who pay the balance in full.
💡 Why it made sense then
Cards competed for customers, and a rebate on spending was an easy pitch.
🎮 In Journey Shares
Bank cards pay up to 1.5% back on everything, or more in categories such as 3% on fashion, pets and farms, or 5% on vehicles and homes.
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