[update 11/25/14: Twitter follower @jlazarev pointed out this morning that he was unable to redeem the $15.22 in his Discover cash back balance. It seems I overstated the change that Discover had made: they didn't remove the redemption threshold, which remains at $50, but now allow cardholders to redeem cash back in any amount over $50. This is not as good as removing the redemption threshold entirely, but is still a big improvement in the war against "orphaned" cash back.]
If you follow this blog, you know I'm fond of the Discover It (previously Discover More) cash back card, which has revolving 5% cash back categories, occasional bonuses (targeted and not-so-targeted), no foreign transaction fees, and gives access to ShopDiscover, an online shopping portals which typically has among the highest payouts for many online merchants.
The card's principle drawback has always been its cruel redemption thresholds: while a cardmember's rewards balance is denominated in "dollars" of cash back, that balance could only be redeemed for statement credits or bank account direct deposits in increments of $50. While bloggers like Frequent Miler did the Lord's work finding creative redemptions for odd-sized balances, there's no escaping the fact that cash is king, and Discover has historically made it as hard as possible for cardholders to get our hands on that crown.
Discover cash back can now be redeemed for cash in increments of 1 cent
Imagine my shock when I logged into the Discover app this evening to see that Discover is now allowing cardholders' cash back balances to be redeemed for statement credits or direct deposits in any amount. I don't know for sure when this change went into effect, but I have not seen it reported anywhere yet.
I don't want to overstate the magnitude of this change: it's long been possible to redeem Discover cash back balances for Amazon.com purchases (and Amazon "gift" credit) in any amount, so orphaned balances haven't necessarily been a problem, as long as you're content with Amazon credit in lieu of cash.
But Amazon.com credits aren't cash, while direct deposits are and statement credits are close. This is a huge improvement in the value proposition of the card, and is going to get me to direct even more of my portal shopping to ShopDiscover, which frequently has among the highest merchant payouts at face value, but whose payouts have always had to be discounted by the inconvenience and inflexibility of Discover cash back redemptions.