I received an email from a reader named Sergio and he asked about the capped earnings on some cash back credit cards:

I have been looking for a cashback card but found that they all have a limit on the amount of cashback you can earn.
For example, only $20,000 put on the card is eligible for cashback.  After that amount, no cashback is given.

He’s right – many cash back cards do limit the amount you can earn.  Sergio asked specifically about the Scotia Momentum Visa Infinite – the cash back card that pays 4% back on groceries and gas and 2% back on recurring bills and drug store purchases.

Related: Getting approved for premium credit cards – some are harder than others

Scotia does mention an annual spend limit of $25,000 on the card.  But let’s dig into that and see what they mean:

The Scotia Momentum Visa Infinite does indeed have a limit, but it’s quite high.

For example, it pays 4% cash back for any grocery and gas spending, up to $25,000 per year.  It also pays 2% cash back for any recurring bill payments and drug store spending, up to $25,000 per year.

Two separate categories, two separate earnings caps.

That means you’d have to spend over $2,000 per month in groceries and gas, AND/OR over $2,000 per month in recurring bills and drug store purchases to reach the annual limits.

You’ll earn 1% back on everything that exceeds the annual spending maximum (“overflow spending”), and for all other purchases made outside of the core categories.  There’s no limit to how much you can earn at the 1% rate.

Cards With Capped Earnings

One of the most popular cash back credit cards – the MBNA Smart Cash Platinum MasterCard – has capped earnings after the first $1,250 in monthly spend.  Here’s how it works:

  • Earn 5% back on grocery and gas purchases, up to $400 per month, for the first six months
  • Earn 2% back on grocery and gas purchases, up to $400 per month, after the first six months.
  • Earn 1% back on all other purchases, up to a total of $1,250 on the card per month.

If you have the Smart Cash Platinum card, you can get around the earnings cap by calling MBNA and asking to be upgraded to the Smart Cash World MasterCard.

Related: 7 Cash Back Credit Cards Compared

With the World version of this card, there is no limit on how much you can earn at the 1% cash back rate.  To qualify, MBNA says your personal income must be greater than $60,000 or your household income must be greater than $100,000.

Final thoughts

It’s a good idea to check the terms and conditions of your cash back credit card to make sure there are no limits on the amount of cash back you can earn.

If the card has a high threshold, like the Scotia Momentum Visa Infinite, it shouldn’t be a problem, but for other cards like Smart Cash you can easily exceed the monthly cap.

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