There are a number of student credit cards that are designed for college students who don’t have a credit history or high credit scores. One option is the Discover it® Student Cash Back, which offers a credit card rewards program that allows students to earn cash back on select purchases.
If you’re looking to build your credit history while still on campus — and earn rewards — this credit card is a good choice to consider. Here’s why (and why not) you may want to weigh this option.
When is the Discover it Student Cash Back worth it?
There are instances in which the Discover it Student Cash Back credit card is worth considering, including:
When you need to build your credit history
This Discover it Student Cash Back doesn’t require applicants to have a credit score, making this card a viable choice for students who don’t yet have a credit history. Plus, this card offers rewards, a feature that isn’t always available for students who don’t have a credit history.
When you want to earn rewards
The Discover it Student Cash Back card is a good choice to consider for college students who want to both build their credit and earn cash back while doing so. You’ll earn 5 percent cash back after activation on the purchases made in rotating bonus categories each quarter (on up to $1,500 per quarter, then 1 percent back), plus 1 percent cash back on all other purchases.
This card’s bonus categories rotate, which means that the categories in which you can earn 5 percent cash back will change each quarter. In the past, some of the most common bonus categories have been grocery stores, gas stations, restaurants, Target, Amazon and PayPal.
When you want flexibility with your rewards redemption
You can redeem your cash back earned with this credit card in several ways. The options include a direct deposit to your bank account or a statement credit to your Discover bill, lowering what you owe. You can also use your cash back to pay for items at Amazon.com and through PayPal, to buy gift cards (starting at $5) or make a charitable donation.
When you want to earn a welcome bonus
The Discover it Student Cash Back card also comes with a welcome bonus for new cardholders — Discover’s Cashback Match. With this bonus, Discover will match all of the cash rewards you earn during the first 12 months of card membership. For example, if you earn $100 in cash back during the first year of opening your account, Discover will then give you an additional $100 in cash back at the end of the year, for a total of $200.
When you want an intro APR on purchases and balance transfers
This card comes with a 0 percent intro APR on new purchases for the first six months after you open your card (then a variable APR of 18.24 to 27.24 percent). It also offers a 10.99 percent intro APR on balance transfers for six months, followed by the standard variable APR.
The intro APRs can save you money if you need to pay off debt or a large purchase over time and want to do so without interest. Just note, of course, that after the introductory period ends, your card’s standard variable APR will kick in.
When is the Discover it Student Cash Back not worth it?
There are also situations in which the Discover it Student Cash Back credit card may not be worth it, including:
When your spending habits don’t align with the card
Depending on your spending habits, the Discover it Student Cash Back card might not be the right choice for you. The main perk of this credit card is its rewards program, so you should be sure the rotating spending categories are a good fit for your spending habits. For example, if you don’t spend a lot at gas stations or grocery stores, you might not earn much cash back for that quarter when those are the 5 percent cash back categories.
However, if you don’t yet have a credit score or your credit score isn’t very good, you may not be able to qualify for many other top student credit cards. In that case, your first priority may be to build your credit score. And, if you qualify for the Discover it Student Cash Back, earning some rewards with this card while building credit — even if your spending habits don’t align — would be better than not earning any.
When you don’t want a card with rotating categories
Enrollment in the bonus categories is required each quarter. If that sounds like a hassle, you may prefer a student credit card that earns either boosted rewards in select fixed categories or a flat rate of rewards on all purchases instead.
Should you get the Discover it Student Cash Back?
Whether or not you should get this card depends on your goals for your credit card. That said, the Discover it Student Cash Back comes with a few perks that may appeal to students. You can earn 5 percent cash back on up to $1,500 in purchases in select categories each quarter (after activation, then 1 percent). If you’re able to max out the purchase limit each quarter, you could earn $75 in cash back each quarter, which comes out to $300 in cash back per year.
The cash back you’ve earned during your first year will also be doubled, meaning that you’ll get another $300 at the end of the year. Plus, the card offers numerous ways to redeem rewards and a zero-interest offer on purchases — a feature that can help you pay off large purchases over time, like furnishing your first apartment.
And, after you graduate, you may be able to convert the Discover it Student Cash Back to a standard Discover cash back card. Depending on your income and credit score then, this could mean a higher credit limit (in addition to other perks).
As long as you don’t charge more than you can pay off in full by every due date, the Discover it Student Cash Back can be a good choice for many college students. It comes with no annual fee, a good rewards program, a welcome bonus, flexible redemption options and an intro APR offer on purchases and balance transfers. Plus, with responsible use, you may have the option to upgrade the card to a different Discover card after graduating.
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