Cashback Credit Card Vs Miles Credit Card

Last Updated : April 11, 2025, 12:13 p.m.

In today's dynamic financial landscape, choosing the right credit card can significantly impact your savings and lifestyle benefits. Two popular options in India are cashback credit cards and miles credit cards . Let's explore the key differences, benefits, and considerations to help you determine which type best suits your needs and spending habits. After choosing the type of credit card most aligned to your lifestyle, you can go on to apply for popular cashback or miles credit cards. Before you apply, it is ideal to do a free CIBIL score check on Wishfin, as the credit score is the most important factor governing the approval of your application.

What are Cashback Credit Cards?

Cashback credit cards are financial products that offer a percentage of your spending back as cash credit. This cashback is typically credited directly to your statement, a linked wallet, or as reward points that can be redeemed at a 1:1 ratio.

Benefits of Cashback Credit Cards

• Zero Planning with Fixed Value: Cashback cards provide predictable returns with minimal effort. You know exactly what you'll get back on your purchases.
  
• Easy Reward Redemption: Redemption is simple and flexible, with cashback usually credited directly to your card statement or deposited to your bank account.
  
• Category-Based Rewards: Many cashback cards offer bonus rewards in specific categories like groceries, dining, or online shopping, enabling maximized savings on daily expenses.
  
• Lower Annual Fees: Cashback cards typically have lower annual fees compared to travel cards, with many options charging no annual fee at all.
  
• Additional Security: Some cashback cards offer purchase protection options covering losses from damaged items bought with the card.

Popular Cashback Credit Cards in India 2025

• Cashback SBI Card: The SBI Cashback Credit Card remains one of the most sought-after options for online shoppers in 2025. This card is particularly valuable for frequent online shoppers, offering a straightforward cashback structure without complicated reward point systems.
• HDFC Millennia Credit Card :The HDFC Millennia Credit Card is tailored to meet the lifestyle needs of millennials with substantial cashback on popular platforms. This card is perfect for young professionals who spend frequently on entertainment, shopping, and food delivery services.
• Axis Bank ACE Credit Card: The Axis Bank ACE Credit Card offers excellent cashback benefits for utility bill payments and food delivery services. This card is particularly useful for managing household expenses while earning substantial cashback on essential services.
• Flipkart Axis Bank Credit Card: For Flipkart loyalists, this co-branded card offers excellent value with cashback across multiple platforms.

• HSBC Live+ Credit Card: For those who prioritize dining and groceries, the HSBC Live+ Credit Card offers impressive cashback benefits.

How to Choose the Right Cashback Credit Card?

When selecting a cashback credit card in 2025, consider these factors:

• Spending Habits: Choose a card that offers higher cashback in categories where you spend the most.
• Annual Fee: Calculate whether the cashback earned will exceed the annual fee.
• Redemption Process: Some cards automatically credit cashback to your statement, while others require manual redemption.
• Cashback Caps: Be aware of monthly or quarterly limits on cashback earnings.
• Additional Benefits: Consider supplementary benefits like lounge access, insurance coverage, or milestone rewards.

What are Miles Credit Cards?

Miles credit cards in India are specialized travel rewards cards that allow cardholders to earn air miles or travel points on their purchases. These miles can be redeemed for flight tickets, hotel stays, and various travel-related expenses.

Benefits of Miles Credit Cards

• Travel Perks: Miles cards offer benefits like complimentary airport lounge access, travel insurance, priority boarding, and hotel room upgrades.
• Potential for Higher Value: When strategically redeemed, miles can deliver significantly higher value than cash rewards, especially for premium travel experiences.
• Welcome and Anniversary Bonuses: Miles cards typically offer generous welcome bonuses and anniversary incentives like airline lounge passes or free hotel night certificates.
• Zero Foreign Transaction Fees: Many travel cards offer low or zero forex markup fees, saving substantial money on international transactions.
• Elite Status Pathways: Some miles cards help you earn elite status with airlines or hotels based on card spending.

Popular Miles Credit Cards in India 2025

• Axis Atlas Credit Card: The Axis Atlas Credit Card stands out as one of the premier travel cards available in India today. What sets the Axis Atlas apart is its exceptional EDGE Miles conversion ratio and tier-based structure that rewards high spenders with enhanced benefits.

• IDFC First Wealth Credit Card: This zero-annual-fee card has gained immense popularity among frequent international travelers.

• SBI Card Elite: A premium travel card with an excellent balance of benefits and reasonable fees.

• HSBC TravelOne Credit Card: The HSBC TravelOne has emerged as a strong contender in 2025's miles card lineup.

• HDFC Infinia Credit Card: An elite travel card targeted at high-net-worth individuals.

How to Choose the Right Miles Credit Card?

When choosing a miles credit card in India, consider these factors:

• Annual Fee vs. Benefits: Evaluate whether the benefits outweigh the annual fee. Cards like IDFC First Wealth offer zero annual fees, while premium options like Axis Atlas or HDFC Infinia provide enhanced benefits that justify their higher fees.
• Reward Earning Rate: Look at how quickly you can accumulate miles or points based on your spending habits. Some cards offer accelerated earning on specific categories like travel or dining.
• Redemption Value: Consider how easily you can redeem your miles and what value you get per point/mile. Axis Atlas, for instance, offers an exceptional 1:2 conversion ratio for most airline partners.
• Lounge Access: If you travel frequently, prioritize cards offering generous domestic and international lounge access.
• Forex Markup: For international travelers, cards with low forex markup fees (like HSBC TravelOne with zero forex charges) provide significant savings.

Key Differences: A Side-by-Side Comparison

Which Card Type Is Right For You?

Choose a Cashback Card If

• You prefer simple, predictable rewards without complex redemption strategies
• You don't travel frequently or don't need premium travel perks
• You want to avoid high annual fees
• You value flexibility in how you use your rewards
• You make regular everyday purchases across diverse categories

Choose a Miles Card If:

• You travel frequently and can utilize airport lounges, travel insurance, and other perks
• You're willing to invest time learning how to maximize miles redemption
• You have flexibility in your travel dates to find optimal redemption options
• You're comfortable with potentially higher annual fees
• You aspire to premium travel experiences like business class flights or luxury hotel stays.

Important Considerations in Choosing the Type of Card

• Spending Patterns: Analyze your monthly expenses to determine where you spend the most money, then choose a card that maximizes rewards in those categories.
• Annual Fees vs. Benefits: Calculate whether the rewards and benefits you will receive outweigh any annual fees.
• Foreign Transaction Fees: If you travel internationally, consider cards with low forex markup fees.
• Redemption Restrictions: Miles cards often have blackout dates or limited seat availability, while cashback has fewer restrictions.
• Multiple Card Strategy: For maximum benefits, consider having both types—a miles card for travel expenses and a cashback card for everyday purchases.

Conclusion

Both cashback and miles credit cards offer distinct advantages depending on your lifestyle and spending habits. Cashback cards provide straightforward value with minimal effort, making them ideal for everyday spenders seeking simplicity. Miles cards deliver potentially higher value and exclusive perks for those who travel frequently and can navigate more complex reward systems.

The best choice ultimately depends on your personal preferences, spending patterns, and financial goals. By understanding the key differences outlined in this article, you can make an informed decision that maximizes your credit card benefits while complementing your lifestyle.