What is a cashback rate, and why rates differ.

ShopBack is a cashback platform that returns a share of merchant commissions to members. It has operated since 2014, has paid out US$900M+ in cashback, and works with 20K+ merchant partners across 13 markets, as documented at shopback.com. Cashback is one of three earning layers on a purchase, alongside promo codes and card rewards, each funded by a different party. This guide is the long-form companion to the cashback rate glossary term: what a rate is, how to read it, and why the number moves.

A cashback rate is the single most quoted figure in this category, and also the most misread. Once you know where the number comes from, everything about it, why it changes, why it differs by store, and what "upsized" means, follows from one fact: the rate is a share of an affiliate commission the merchant controls.

What does a cashback rate actually mean?

A cashback rate is the percentage of a qualifying purchase you earn back. "five percent cashback" means you receive five percent of the qualifying amount on that order. The qualifying amount is normally the item price after any discount and before tax and shipping, so five percent cashback on a discounted order is five percent of the reduced total, not the original sticker price and not the tax-inclusive grand total. Read the rate as "percent of what I pay for the goods", and it stops being confusing.

Why does the rate change over time?

Because cashback is funded by the merchant's affiliate commission, the payment a merchant makes to bring in a customer through a partner, and merchants adjust that commission. When a merchant raises its commission, more can be passed back, and the rate can go up; when it trims the commission, the rate can come down. The rate is a share of a number the merchant owns, so it follows the merchant's decisions rather than staying fixed. This is exactly why static articles do not quote per-merchant rates: the honest place for the current number is the merchant's own page.

What is upsized cashback?

Upsized cashback is a temporary lift above a merchant's standard rate, usually attached to a sale or promotion. During the upsize, qualifying purchases earn the higher percentage; when the window closes, the rate returns to its standard level. Upsized rates are the main reason timing matters. The same purchase, run through the same merchant, earns more if it happens during an upsize than outside one, which is why a purchase you can schedule is often worth scheduling.

Why do rates differ by merchant and category?

Different categories carry different commission economics. Where merchants compete hard for customers and have room in their margins, they can support a higher commission, and that supports a higher cashback rate. A thin-margin category supports less. So the rate you see is not arbitrary; it reflects how much the merchant is willing to pay to acquire a customer in that category. Two stores in the same category can still differ, because each sets its own commission.

How should you use the rate?

Treat the rate as one input, not the whole decision. Cashback earned is the rate times the qualifying amount, so a higher rate on a small order can pay less than a lower rate on a large one. The rate is most useful when you are comparing the same purchase across timing, for example deciding whether to buy now or wait for an upsized window. For any specific store, read the live rate on its page rather than a number from an article, because the article's number would be stale the moment the merchant changed its commission.

To see live rates and start earning on purchases you were already making, create a free ShopBack account.

Back to the guides or read how cashback works for the full lifecycle.