Debit Rewards Surge as Consumers Shift Spending Preferences

Debit rewards programs had seemingly gone the way of the dodo.

The Durbin Amendment, contained in the 2010 Dodd-Frank Act, capped fees on debit card payments, which set in motion a ripple effect that led to banks’ elimination of many of those programs. As noted here, those programs were slashed by as much as 50% immediately after the legislation took effect.

But the continued rise of debit as a preferred method of spending, and the value consumers place on rewards as a way to help manage their day-to-day financial lives, is giving new life to debit rewards.

PYMNTS Intelligence data revealed at the start 2025 that “cash on hand” has been a guiding force when making everyday purchases, such as for groceries or relatively smaller retail transactions. For example, 44% of consumers made grocery purchases with debit cards, compared with 26% opting for credit. In retail environments, the respective percentages were 39% and 30%. Debit has also been cited for its convenience.

Recent announcements underscore the debit rewards resurgence.

Earlier this month, Prizeout announced the debut of CashBack+Pay, through its CashBack+ platform. The company has said that the cash-back program for credit union debit cards enables instant rewards for as much as 6.8% of the transaction value. Initial credit unions that have gone live with the program included Interra Credit Union and Michigan State Federal Credit Union, among others, with a pipeline in place for more additions. In terms of the mechanics, Prizeout’s release notes that upon downloading the CashBack+ Pay app, financial institution members will connect to their credit union, opting to shop online or in store directly from their credit union bank account.

Venmo announced earlier this month that, in an update to its debit card functionality, The Venmo Debit Card now offers 15% cash back at several retailers, including Lyft, McDonald’s, Sephora, Walgreens and Walmart. Venmo, as PayPal indicated in its latest quarterly results, has seen monthly active cardholders increase by 40%.

PYMNTS reported earlier this year that Galileo Financial Technologies launched a co-brand debit rewards program geared towards offering the same features that have traditionally been the purview of credit cards, by integrated issuing and program management for the co-branded cards. In March, SoFi partnered with hotel rewards program Wyndham Rewards to launch a debit card that lets users earn travel rewards and points on everyday spend. In an interview with PYMNTS CEO Karen Webster, Galileo CEO Derek White observed, “Brands are starting to recognize there’s an opportunity — that when their members show up at a hotel or in stores, wherever they might be at the point of decision and at the point of purchase, they’re using debit.”

In a read across for debit, gleaned from the credit realm, separate PYMNTS data indicates that ways in which rewards boost repeat usage of cards, and elevate those cards to top of wallet status. In the May 2025 report “How Consumers Decide Which Card to Pay With,” we found that 1 in 4 consumers rotate their cards to maximize rewards; two thirds of younger consumers in the Gen Z demographic seek out cards with rewards attached. Overall, and across more than 2,200 consumers surveyed, 30% of frequent credit card users redeemed rewards at least once a month, effectively turning those cards into primary cards.

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