Pick any two Indian credit cards and one will pay you in points, the other in cashback. Marketing copy makes them sound interchangeable — they're not. Cashback is real money. Points are conditional money whose value depends entirely on how you redeem them. Here's the framework for choosing.
The fundamental difference
| Cashback | Reward points | |
|---|---|---|
| What you get | Statement credit / Amazon Pay balance / direct ₹ | Points in issuer wallet |
| Value certainty | Fixed — 1 ₹ = 1 ₹ | Variable — 1 point = ₹0.20-₹1.00 depending on redemption |
| Effort to use | Zero | Browse catalogue, choose voucher / merchandise |
| Expiry | None on most cards | 24-36 months typical (some never expire) |
| Best fit | Direct value seekers | Travel optimisers, gift-buyers |
Point value — the haircut
The trick to comparing point cards to cashback cards is converting points into ₹ at REAL redemption rates, not the issuer's marketing rate.
| Card | Points per ₹100 | Best ₹/point | Statement credit ₹/point | Effective best % |
|---|---|---|---|---|
| HDFC Infinia | 5 | ₹1.00 (SmartBuy gift voucher) | ₹0.30 | 5% |
| HDFC Regalia Gold | 4 | ₹0.50 (SmartBuy) | ₹0.20 | 2% |
| SBI Card ELITE | 2 | ₹0.50 (Yatra travel) | ₹0.25 | 1% |
| SBI SimplyCLICK | 1 (10X partners) | ₹0.25 (Amazon voucher) | ₹0.25 | 2.5% |
| Axis Magnus | 12 per ₹200 | ₹0.20 (gift voucher) | ₹0.20 | 1.2% |
Compare against cashback cards: Amazon Pay ICICI 5% on Amazon (no haircut), Axis Ace 2% flat (no haircut), HDFC Millennia 5% on partners (capped, no haircut). Cashback eats no margin in redemption.
When points beat cashback
- Travel optimisers. HDFC Infinia / Diners Black points redeemed for SmartBuy hotels at the maximum-value tier hit ₹1/point — meaning a 5X on dining = 5% effective return. Beats most cashback cards.
- Annual milestones / gifting. Voucher catalogues (Marriott, Tata Cliq, Amazon, Pantaloons) often have one-shot vouchers worth more than ₹0.50/point.
- Frequent flyers. Points convert to airline miles (Vistara, Etihad, Singapore Airlines) at near-1:1 rates. A return Mumbai-Delhi business-class miles redemption is worth 2-3X cash equivalent.
When cashback wins
- Predictable spend. If your basket is groceries / fuel / utilities — categories without travel-class redemption value — cashback beats points every time.
- Low-effort users. If you won't log into a portal every quarter to redeem, points expire worthless. Take cashback.
- Multi-card holders. Carrying 4 cards with separate point pots gets unwieldy. Cashback consolidates as statement credit.
The hybrid play
Many smart spenders carry both. Example combo:
- Amazon Pay ICICI — 5% cashback on Amazon (zero effort).
- Axis Ace — 2% flat cashback on everything else (zero effort).
- HDFC Infinia — points for travel (high effort, high value if used right).
Use the calculator
Plug your monthly spend into our Credit Card Reward Calculator — it shows the actual annual ₹ each card returns based on real redemption rates, not marketing claims.
Frequently Asked Questions
Do unredeemed reward points show up in CIBIL or my net worth?
No. They're an off-balance-sheet liability of the issuer; not a financial asset of yours. Treat them as a "use it or lose it" coupon.
What's a "redemption haircut"?
The gap between the issuer's marketing point value and what you can actually get. SBI ELITE markets as 2X on dining (~2% return) but statement-credit redemption pays 0.25/point — actual return is 0.5%.
Can I sell reward points?
Most cards prohibit it explicitly. Some grey-market resellers exist; doing this risks card cancellation.
🧭 Compare next: best cashback credit cards · best rewards credit cards
Credit Cards Editor, OnePaisa Editorial
Sandhya writes on credit cards for OnePaisa — reward programmes, fees and charges, lounge and travel benefits, and head-to-head card comparisons. Every fee, earn rate and benefit in her guides is checked against the issuer's MITC document and official product page, and against OnePaisa's verified product data, before it is published. Where an issuer does not disclose a number, the guide says so instead of estimating it.
Work published under this byline follows OnePaisa’s editorial standards — how our guides are researched, fact-checked against primary sources, and corrected.