New credit card offers 7.5% cashback on DMart, Blinkit, Zepto, BigBasket

If a large part of your monthly household budget goes towards groceries, a new credit card launched by Federal Bank and Paisabazaar could help you earn more cashback on one of the most frequent expenses.

The Federal Bank Paisabazaar Paisaback Credit Card, launched on September 10, offers 7.5% cashback on eligible online and offline grocery purchases. The card is available on the RuPay network and covers purchases at several supermarkets and quick-commerce platforms.

7.5% cashback on grocery shopping

The biggest attraction of the card is its cashback on grocery spending.

Cardholders can earn 7.5% cashback on eligible grocery purchases made online and offline at merchants including:

•  
• DMart
• Reliance Fresh
• Star Bazaar
• Nature's Basket
• Blinkit
• Zepto
• Swiggy Instamart
• BigBasket

For a household that regularly uses quick-commerce apps or supermarkets for monthly shopping, this category-specific reward could potentially translate into meaningful savings.

However, there is a maximum cashback benefit of ₹1,000 per month across eligible transactions.

That means the headline 7.5% rate does not apply without limit. At a 7.5% cashback rate, spending of around ₹13,333 on eligible transactions would be enough to reach the ₹1,000 monthly cashback cap, assuming the entire spend qualifies.

What cashback can you earn on other spends?

The card isn't restricted to grocery purchases.

Cardholders get:

• 1% cashback on eligible POS and e-commerce transactions
• 0.5% cashback on eligible UPI transactions above ₹2,000
• Fuel surcharge waiver of up to ₹100 per billing cycle

The 0.5% UPI cashback, however, comes with exclusions. It is applicable to eligible UPI transactions above ₹2,000 but excludes grocery, fuel and travel categories.

Cashback comes as Cash Points

The cashback earned on the card is credited as Cash Points directly to the customer's account.

These Cash Points can be redeemed by the cardholder and have a validity of one year.

This is worth keeping in mind because the rewards are not indefinitely available once credited. Cardholders need to redeem their accumulated Cash Points within the stipulated validity period.

₹500 annual fee, waived at ₹1.5 lakh spending

The Paisaback Credit Card carries a ₹500 joining fee and ₹500 annual fee.

However, the annual fee will be waived if the cardholder spends ₹1.5 lakh or more annually.

For someone who can comfortably meet the ₹1.5 lakh spending threshold, the annual fee waiver effectively removes the recurring card fee.

Consumers should nevertheless check which transactions qualify towards the annual-spend requirement before applying.

Is the card useful for a regular grocery shopper?

The card's value proposition is fairly straightforward: the more of your eligible grocery spending that falls within the cashback category, the more useful the card becomes.

For example, a person spending ₹10,000 a month on eligible grocery purchases could theoretically earn ₹750 in cashback at the advertised 7.5% rate, subject to the card's terms and monthly cap.

At ₹13,333 of eligible grocery spending, the cashback would reach the ₹1,000 monthly maximum.

Beyond that, additional eligible grocery spending would not generate cashback above the monthly ₹1,000 ceiling.

The card may therefore appeal particularly to households that have regular grocery expenses but want to avoid using multiple cards to maximise category-specific rewards.

Santosh Agarwal, CEO, Paisabazaar, said the card was designed around recurring household expenses.

“Credit card rewards are most valuable when they translate into meaningful savings on expenses consumers make every month,” Agarwal said, adding that grocery spending is a significant recurring expense for households.

Saugata Basu, Senior Vice President and Head, Retail – Cards and Personal Loans, Federal Bank, said the card has been designed to reward customers on everyday spending, particularly essential categories such as groceries. "We believe this product will redefine how customers perceive value from their everyday spending.”

Key Features of Paisaback Credit Card

•  7.5% cashback on eligible grocery purchases made online and offline at merchants such as Reliance Fresh, DMart, Star Bazaar, Nature's Basket, Blinkit, Zepto, Swiggy Instamart and BigBasket
• 1% cashback on eligible POS and e-commerce spends
•  0.5% cashback on eligible UPI transactions above Rs. 2,000, excluding grocery, fuel and
• travel categories
• Cashback credited as Cash Points, with a validity of one year
•  Maximum cashback benefit of Rs. 1,000 per month across eligible transactions
•  Fuel surcharge waiver of up to Rs. 100 per billing cycle
•  Annual fee waiver on annual spends of Rs. 1.5 lakh or more

For consumers, the key takeaway is that the 7.5% grocery cashback is the card's biggest selling point, but the ₹1,000 monthly cap is equally important. Those considering the card should compare their actual grocery spending, preferred supermarkets and quick-commerce usage with the fee-waiver and cashback conditions before applying.