Discover Credit Cards

Discover is a pretty generous credit card issuer. Discover cards all have decent cash back programs, even the student and secured cards, along with low introductory APRs and no annual fees.

If you’re looking for perks, however, you’ll be disappointed; Discover cards used to have some basic shopping and travel protections, but now cash back is the main feature.

Still, Discover cards are an easy entry into the credit card game — they’re easy to use, relatively easy to get, and customer support is easy to talk to if you have any questions.

Card	Rewards
Discover it® Cash Back	5% cash back in categories that rotate every 3 months, up to $1,500 spent per quarter, then 1% (activation required) 1% cash back for every other purchase Cashback Match: All cash back earned in the first year is doubled
Discover it® chrome	2% cash back at Gas stations and Restaurants, up to $1,000 spent per quarter (then 1%) 1% cash back for every other purchase Cashback Match: All cash back earned in the first year is doubled
Discover it® Miles	1.5X miles per dollar for every purchase Miles Match: All miles earned in the first year are doubled
Discover it® Student Cash Back	5% cash back in categories that rotate every 3 months, up to $1,500 spent per quarter, then 1% (activation required) 1% cash back for every other purchase Cashback Match: All cash back earned in the first year is doubled
Discover it® Student chrome	2% cash back at Gas stations and Restaurants, up to $1,000 spent per quarter (then 1%) 1% cash back for every other purchase Cashback Match: All cash back earned in the first year is doubled
Discover it® Secured	2% cash back at Gas stations and Restaurants, up to $1,000 spent per quarter (then 1%) 1% cash back for every other purchase Cashback Match: All cash back earned in the first year is doubled
Discover it® Business Card	1.5% cash back for every purchase Cashback Match: All cash back earned in the first year is doubled

Cash Back

The Discover it® Cash Back is a classic, and a go-to option for many first-time credit card holders. It’s got a high cash back rate for a no annual fee card, and the rotating bonus categories are attractive.

It might be a good fit for you, too, if you make a variety of purchases throughout the year (and who doesn’t?). Just take note of the quarterly maximum spending limit.

Spending Rewards
5% cash back in categories that rotate every three months (see calendar below), on the first $1,500 spent per quarter, then 1% (activation required)
1% cash back on all other purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Quarter	5% Cash Back Categories (2020)
January – March	Grocery Stores, Walgreens, CVS
April – June	Gas Stations, Uber, Lyft, Wholesale Clubs
July – September	Restaurants, PayPal
October – December	Amazon.com, Target.com, Walmart.com

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase and Balance Transfer APR: 0% for 14 months, then 13.49% - 24.49% Variable
• No foreign transaction fee
• Annual fee: $0

The Discover it® chrome has the potential to be pretty rewarding in the first year, with a 4% cash back equivalent in the bonus categories. But other than that it’s not too exciting and we wouldn’t typically recommend it, because you’ll only get that rate for the first year and the quarterly spending limit is fairly low.

Spending Rewards
2% cash back on up to $1,000 spent per quarter (then 1%) at: Gas stations Restaurants
1% cash back on all other purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase and Balance Transfer APR: 0% for 14 months, then 13.49% - 24.49% Variable
• No foreign transaction fee
• Annual fee: $0

Travel

Discover’s only travel card isn’t very exciting. The Discover it® Miles card doesn’t even really have much to do with travel, outside the name (it used to have a small airline WiFi credit, but no longer).

Since every Discover mile is worth 1 cent, no matter how you redeem it, this card essentially provides 1.5% cash back for everything you buy, travel or otherwise — not a bad deal, but not particularly useful for hotel stays and airfare. Go with a travel card with bonus categories for those kinds of purchases instead.

Spending Rewards
1.5X miles per dollar on all purchases

Introductory Bonus Offer
Miles Match: New cardmembers get double miles in the first year (awarded after the first year)

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase APR: 0% for 14 months, then 13.49% - 24.49% Variable
• Balance Transfer APR: 10.99% for 14 months, then 13.49% - 24.49% Variable
• No foreign transaction fee
• Annual fee: $0

Student

The Discover it® Student Cash Back is one of the best student credit cards — its reward program is surprisingly good for a card designed for limited or no credit history.

The rewards and benefits are just like the regular Discover it, in fact, plus a Good Grade Reward for being a good student. But the introductory interest rates aren’t as valuable.

Spending Rewards
5% cash back in categories that rotate every three months (see calendar below), on the first $1,500 spent per quarter, then 1% (activation required)
1% cash back on all other purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Quarter	5% Cash Back Categories (2020)
January – March	Grocery Stores, Walgreens, CVS
April – June	Gas Stations, Uber, Lyft, Wholesale Clubs
July – September	Restaurants, PayPal
October – December	Amazon.com, Target.com, Walmart.com

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase APR: 0% for 6 months, then 14.49% - 23.49% Variable
• Balance Transfer APR: 10.99% for 6 months, then 14.49% - 23.49% Variable
• No foreign transaction fee
• Annual fee: $0

The Discover it® Student chrome is like the Discover it Chrome above — and like the basic version, this student card doesn’t have much to offer outside the Cashback Match in the first year. But if you’re a student with limited credit, who spends a lot on gas and dining, you might find it useful.

Spending Rewards
2% cash back on up to $1,000 spent per quarter (then 1%) at: Gas stations Restaurants
1% cash back on all other purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase APR: 0% for 6 months, then 14.49% - 23.49% Variable
• Balance Transfer APR: 10.99% for 6 months, then 14.49% - 23.49% Variable
• No foreign transaction fee
• Annual fee: $0

Secured

Discover’s secured card is impressive. It looks more like your average rewards card, complete with cash back categories and a signup bonus. But it does require a security deposit of $200 to $2,500, and your credit limit will be equal to the deposit.

This is the best kind of secured card, because Discover will review your credit and card activity every eight months: If you’ve shown responsible behavior, your deposit may be returned, and you can continue using the card. This is a handy feature because you won’t need to close the account to get your deposit back, which isn’t necessarily good for your credit scores.

Spending Rewards
2% cash back on up to $1,000 spent per quarter (then 1%) at: Gas stations Restaurants
1% cash back on all other purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase APR: 24.49% Variable
• Balance Transfer APR: 10.99% for 6 months, then 24.49% Variable
• No foreign transaction fee
• Annual fee: $0

Business

A simple option for small business owners, the Discover it® Business Card offers a bit of cash back on everything you buy. Flat-rate cards like these pair nicely with business credit cards that have bonus categories, like office supplies or internet/phone services.

Spending Rewards
1.5% cash back on all purchases

Introductory Bonus Offer
Cashback Match: New cardmembers get double cash back in the first year (awarded after the first year)

Key Features

• Free credit score: Check your FICO Score 8, based on your TransUnion credit report.
• Purchase APR: 0% for 12 Months, then 14.49% - 22.49% Variable
• Balance Transfer APR: 14.49% - 22.49% Variable
• No foreign transaction fee
• Annual fee: $0

Discover Credit Card Features

Most Discover cards come with the following features and benefits.

• No annual or foreign transaction fees, first-time late payment fee waiver: You won’t find any fees like these, making Discover cards quite inexpensive to use as long as you avoid interest and other fees. Your first late payment will be forgiven, which can be handy for new cardholders.
• Cashback Match: Every Discover card will double all of the cash back rewards you earn in the first year, a unique feature that gives the equivalent of 10% back with the two Discover it Cash Back cards — an awesome deal, especially for cards without annual fees. (The Discover it Miles earns miles, rather than cash back, and those will be doubled too). The Cashback bonus will be delivered at the end of your first year.
• Introductory APR offers: All Discover cards come with some sort of intro APR offer, like 0% for purchases or balance transfers for a certain amount of time.
• Gift card redemption bonus: Redeem your rewards for gift cards and you’ll get at least $5 added each time, making this Discover’s most valuable redemption method. Where most reward programs provide less for gift cards, or give the same amount as statement credits, Discover provides a better opportunity.
• Credit Scorecard: Discover cardholders can check their FICO Score 8 credit scores for free, based on their TransUnion credit reports. If you’re not a Discover cardholder you can still use the service, but your FICO score will come from your Experian credit report instead (you can use both sides of the service at once).
• Cash at checkout: Get cash at checkout at participating merchants when making a purchase; it will be counted as part of the purchase instead of a costly cash advance.
• Social Security number alerts: Discover will alert you if your SSN is found on any thousands of risky dark web sites.
• New inquiry and new account alerts: Discover will monitor your Experian credit report, and alert you if any new inquiries or accounts appear.
• Freeze it: If you misplace your card, you can temporarily freeze your account to prevent new purchases, balance transfers, and cash advances. Recurring payments and some other activity will still go through. Unfreeze your account when you find the card, or if you don’t, contact customer support at 1-800-347-2683 to report the loss.
• U.S.-based customer support: Discover’s customer support is top notch when it comes to credit card companies.

A Brief History of Discover

Discover Bank is a relative newcomer to the credit card industry, and has already established itself as both a major card issuer and payment network. But that didn’t come without a fight. Now a part of Discover Financial Services, Inc., it provides retail banking services with a focus on U.S. consumers, and has been expanding its service portfolio and global reach.

The first Discover credit card had its official launch in 1986, in a national campaign featuring a commercial during Super Bowl XX. This first card was issued by Dean Witter Financial Services Group, Inc., a part of the Sears corporation. That might sound strange, but Sears had actually been in the credit business for decades at that point: It began offering in-store installment payment plans to farmers in 1911, with other credit products following.

The very first use of a Discover card was a trial run the year before: A $26.77 purchase at a Sears in Atlanta, on September 17th, 1985.

Discover cards caught on fast in the U.S., thanks in part to having no annual fees and higher-than-usual credit limits. They were one of the first to offer cash back for purchases, an attractive feature the company still focuses on today.

In 1987, Discover became the only card accepted by the U.S. Customs Service to pay customs duties, spurring its adoption even further. And by 1989, Discover signed its 1 millionth merchant (a restaurant in Delaware), helping to cement its place as a payment network.

Discover Separates From Sears, Finds Its Own Path

Despite the Discover card’s popularity, the venture was seen as a failure in some important ways. Around 1986–1987 Sears counted a net loss from Discover credit card operations, and other retailers had resisted accepting Discover cards because they didn’t want to help Sears. Instead, some big names were developing their own credit products.

And then comes the buying, selling, and rebranding: In 1993, Sears spun off Dean Witter Financial Services (and the Discover card along with it), and the new company became Dean Witter, Discover & Co. This company later merged with Morgan Stanley in 1997 to become Morgan Stanley Dean Witter, Discover & Co. And in 1999 it rebranded to Discover Financial Services.

The Greenwood Trust Company, in Greenwood, Delaware, had been the issuing bank for Discover cards up until 2000. But at that point it was renamed to the more appropriate Discover Bank. As of today, it’s still the only Discover Bank branch location.

Before 2004, Visa and Mastercard didn’t allow banks to issue Discover or American Express cards if they also issued Visas or Mastercards. But in October of that year Discover won a Supreme Court case, which ruled that Visa and Mastercard were in violation of antitrust regulations. Shortly after, Discover and American Express both began exploring new grounds by issuing cards with other banks (and filed lawsuits against Visa and Mastercard).

In 2007 Discover Financial Services finally spread its wings, leaving Morgan Stanley to become an independent company. Spokesmen affirmed that the separation would be mutually beneficial, leading to more opportunities for both companies. Discover’s payment network up until now had been Novus, but that logo was replaced by Discover’s own. You might still see the Novus logo occasionally, though.

Discover bought Pulse, an interbank electronic funds transfer network, for $311 million in 2005. Buying Pulse gave Discover the capability to issue debit and ATM cards, and it began doing so in 2006 on its own network. With that move it became the only major competitor to Visa and Mastercard debit cards, offering a third debit card/payment network option (if you see a Pulse logo, you can use your Discover card).

You may not know that Discover also owns Diners Club International; In 2008 Discover paid $165 million to acquire the company from Citigroup, meaning you can use Discover cards where you see the Diners Club logo. This acquisition helped fuel Discover’s goal to reach more consumers in more countries, and, if you haven’t been paying attention, it’s made some surprising progress to that end.

Discover’s Expanding Global Reach

Credit card acceptance is an issue that many travelers care about — will you be able to use your card in other countries?

Usually, when you travel abroad, the standard advice is to carry a Visa or Mastercard, especially in Europe (the most widely accepted networks). But if you’re traveling in some parts of the world, particularly Asia, your Discover card could very well do the trick. Discover’s assets and partnerships with other payment networks extend its reach; if you see certain payment logos, like Diners Club, UnionPay, and JCB, you should be able to use your Discover card with no problem (and all Discover cards have no foreign transaction fees).

UnionPay, China’s interbank network, is the largest card payment network in the world in terms of cards issued and total payment volume. It’s still limited mostly to China, but is expanding to Europe and parts of Africa — and that means your Discover card will be accepted in more and more countries.

JCB is a credit card company based in Japan, and Discover’s relationship means you can use Discover cards anywhere you see a JCB logo — you’ll find them mostly in Japan, but JCB’s reach is growing.

The partnerships don’t stop there. You can use your Discover card with quite a few more networks, including:

• BC Card (based in South Korea)
• RuPay (based in India)
• Troy (based in Turkey)
• Verve (based in Nigeria)

Discover’s range seems to be expanding at a steady clip; check the Discover Global Network site for updates.

In 2012 the company reached a milestone when the first international Discover cards were issued, in Ecuador and Russia. But the rollout seems slow, and there isn’t much news about international Discover cards.

With its subsidiary and partner networks, Discover cards may actually have more reach than Visa and Mastercard, in terms of total potential users and merchants; but the number of countries where Discover cards are accepted is still relatively small.

Discover Today

Discover is quite customer friendly, and makes for an interesting if somewhat low-key company. Its credit cards aren’t flashy — they have no annual fees and don’t come with fancy perks. But those cards are quite rewarding (well, the basic Discover it and Secured cards are) and easy to use. The rates and fees for the checking and savings accounts are definitely competitive. And Discover’s networks, subsidiaries, and partnerships are surprisingly prevalent.

In 2013 it became the first credit card company to offer free FICO credit scores to its cardholders — quite the gesture (or a good marketing play), and a move that was copied by every other major issuer. In 2016 it broke the mold again, this time being the first to offer free FICO scores to anyone, cardholder or not.

Sticking with its people-first attitude, in 2019 Discover removed practically all fees from its checking, savings, money market, and CD accounts (perhaps recognizing that, in the digital age, people are less tolerant of fees like these). It’s even offering a full-ride online bachelor’s degree to employees.

Consumers recognize that Discover makes an effort to care about its customers. It consistently ranks highly in J.D. Power’s annual U.S. Credit Card Satisfaction Survey, coming in first in 2019 and 2018, and second in 2017.

Today, Discover Financial Services’ headquarters is located in Riverwoods, Illinois.

Discover forged its own way apart from Visa and Mastercard, by offering a payment network and banking services to go along with its cards (like American Express). With that has come a variety of challenges, but also opportunities. As one of the younger and apparently more flexible credit card companies, it’ll be interesting to see what Discover has in store for next year.