Local shop charging for cashback

timtagel

Hi,

My local shop charges customers who want to have cashback with the amount set at increments from 20, 40, 60p per £10. I just think it's rather mean and tight. However if the owner is charged for the transaction, then I guess it's fair play.

Is this legal? I would have thought the store isn't charged anything for the transaction. Am I wrong or should I report this? If so whom should I speak to.

Thanks in advance.

jaffa30

timtagel wrote:

Hi,

My local shop charges customers who want to have cashback with the amount set at increments from 20, 40, 60p per £10. I just think it's rather mean and tight. However if the owner is charged for the transaction, then I guess it's fair play.

Is this legal? I would have thought the store isn't charged anything for the transaction. Am I wrong or should I report this? If so whom should I speak to.

Thanks in advance.

Our local shop charges a quid a time for use of the cash machine in there, needless to say i nevr use it.


I aint sure on the legal side but someone will know on here

timtagel

Thanks - this isn't via a cash machine - I know they charge for those in store. This is the chip and pin machine - when you get cashback in addition to making a purchase. I didn't think it was legal to charge for that service.

lipidicman

Im not sure of the law, but I do know that the big shops offer cashback as a way of avoiding the costs of banking cash. For a small shop it may not be cost effective and as a credit card user (rather than debit) I don't really know which shops offer the service

jaffa30

timtagel wrote:

Thanks - this isn't via a cash machine - I know they charge for those in store. This is the chip and pin machine - when you get cashback in addition to making a purchase. I didn't think it was legal to charge for that service.

Thats shocking, i would be taking my custom elsewhere.

KizzyK_2

My local offey does the same - 50p for every £10

tigermatt

Well, the shop do get charged for each credit card transaction, so for smaller shops they are getting charged for each payment by card so I guess the more in cashback that is asked for, the higher the fees are. It also means you have to draw out and pay more money than usually from the bank to cover the money that they don't get until the end of the month when the card company pay them the money they gave out in cashback.

Larger shops, especially supermarkets, offer it because it doesn't make much difference to them anyway - most people pay for large amounts of shopping by card anyway and because they are large they are probably only charged 1% instead of the higher amount that smaller shops are charged.

I hope that makes sense.

jockettuk

our local spar charges 50p as well

-=Mr-J=-

Whilst its not illegal for retailers to charge for debit card 'cashback', it is immorral and in for the retailer - money for nothing.

Debit card transactions are based on a low 'fixed' transaction fee, so whether they give you £10 or £100, their transaction fee to the third party is the same.

I've heard quotes of around 6p per transaction - Any retailers care to confirm/deny this?

So, not only do they make money over the transaction fee on the cashback, but as lipidicman says, they also save on the amount paid on transporting and transacting 'cash' to/with the bank.

JohalaReewi

If the local shop also has an ATM that charges, then I am not surprised that they charge for cashback on debit card transactions. It is free money for them and if they charge less than the ATM, they are not going to lose out to that. Get your own back and start paying by cheque

Nile

Hello timtagel


Welcome to the MSE site.:wave: