MSE News: Rpoints & Cashbackkings on verge of going bust

Kingm

latecomer wrote: »

I'd never bothered to claim cashback from them as it wasn't a lot but in the last few months have done quite a lot through them and it jumped to just over £50. Didn't go back to check whether it was ready to be paid until I saw the news today and of course it was. The fact that some people have been prewarned just shows the people in charge didn't care about the those who provided them with a living. Hopefully his new venture will be a complete failure, its what these kind of people deserve.

You will see that its people like you that will be the ones that stand to lose the most. The people that leave there accounts for 6 months and then to remove the money at xmas but of course its not ringfenced and your not protected at all.

I think im right in saying hes talking about IMTL's so that the members monies will be safe. We know all in this world is does not work like that does it?

i.e. as soon as imutual PLC receives validation and payment for a member's cashback transaction, that money is legally safeguarded (via IMTL) until such time as the member requests payment.

So am i right in saying that other sites like quidco and topcashback and fatcheese can use there rep to honour payments but imutual has to have some backend protection to protect the payments?

He also said on his post at imutual

I don't want to discuss here the ins and outs of what happened at Rpoints

I think as a company director you are morally bound to tell your members/customers the truth etc.

oakhouse13

Kingm wrote: »

You will see that its people like you that will be the ones that stand to lose the most. The people that leave there accounts for 6 months and then to remove the money at xmas but of course its not ringfenced and your not protected at all.

Kingm,

Given the large number of members that these cashback sites had, are those who might lose money going to form an action group like the customers who lost money from the collapse of Crown Currency Exchange?

That would enable you, assuming an administrator/liquidator is appointed, to work together. The administrators of Crown Currency Exchange are more aware I think of the interests of individual customers who have lost money because the customers have a representative who attends meetings on behalf of about 2,000 of them who have joined the action group.

http://www.mcr.uk.com/crown-currency-exchange-limited.html

I don't think it necessarily changes whether someone will get money back if there are losses but it does mean that if there are wider or on going questions to be asked, these are more likely to be heard by those in authority.

Having watched it again, I think that the video Martin Lewis made to explain cashback needs updating.

http://www.youtube.com/watch?v=Hhc9xFB16uY

In the shopping centre the lady is walking along and a man in a white t shirt stops her and directs her to the shop that he is an agent for/advertising. Whether you call it an agent or advertiser, makes no difference, consumer law applies to traders and their marketing/advertising/agents. There's a commercial contract between the shop and the paid communication. It has to be disclosed to the customer in a timely manner, in the way that this site discloses affiliate links.

If having gone to the shop on the agent's advice, not knowing he was an agent for the shop, she then discovered what she bought there was a better deal elsewhere, she could complain under Consumer Protection Regulations to Trading Standards that the shop did not disclose to her that the man in the white t shirt worked for the retailer. Information was withheld which led her to make a different purchase and caused her consumer detriment.

The man in the white t shirt in the video needs to have the names of any shops he has commercial contracts with or is advertising on his t shirt for this to be a more accurate demonstration of what cashback is.

Also, the video says that cashback websites do not have advertisements but does the law make these distinctions between what are all commercially paid for communications? Quidco's press releases refer to companies paying for marketing communication which to me is enticement, it's all the same, except the law allows for an innocent publication of advertisement defence.

"the incredible uplift in sales that Quidco achieved for NatWest Home Insurance through on-site and marketing promotions"

http://www.prfire.co.uk/press-release/quidco-named-best-finance-publisher-at-affiliate-marketing-awards-17918.html

PhiltheBear

Well, that's 2 more added to the pile. By the way people are deserting Quidco they'll probably be next. And iMutual? That's destined for the dustbin before it starts.

But there's a big question here - why would you trust ANY cashback site?

If they are going to give you back all their commission then how are they making money? And if they aren't making money then, at some point, they'll go bust.

The MSE idea of "it's a bonus" is fine but there are lots of gullible people out there who still don't understand that buying the cheapest deal is usually much better than buying elsewhere and then relying on cashback.

I'm also very curious about any tie up between MSE and Rpoints. Seems a bit naughty for Martin to continue to promote cashback sites when so many of them hit the skids.

It's particularly strange when this site is naming Quidco as the No 2 site (see: http://www.moneysavingexpert.com/shopping/cashback-websites - scroll down to about halfway on the page) and also hosts a loooong thread about how Quidco have stiffed so many customers. Naturally, this has absolutely nothing to do with the commission that MSE is earning on sign ups for Quidco and TopCashBack. Does it?

competitionscafe

PhiltheBear wrote: »

But there's a big question here - why would you trust ANY cashback site?

If they are going to give you back all their commission then how are they making money? And if they aren't making money then, at some point, they'll go bust.

Quidco make money by charging a £5 annual fee : 500,000 members paying £5 a year = £2.5 million a year. (I have no idea how many active members they have - that's just a plucked from the air figure to give you an example). They also own or at least used to own hotukdeals and other sites and make money from affiliate links on there from people who do not bother to use a cashback site and from amazon links etc.

Topcashback make money from Google adsense ads on the site.

A cashback site is a brand and a popular membership site (topcashback has 700,000 members) in itself creates value and a business which could potentially be sold for example. Detailed information on peoples shopping habits is very valuable information.

Cashback sites also get bonuses for meeting sales targets, Quidco I think also got some sort of overide/share of affiliate networks cut at one stage (no idea if they still do) and some sites like Groupon for example pay a commission on every email sign up which they specify cashback sites are not allowed to pass on to their members (I assume to stop people signing up under multiple email addresses purely for the cashback?) so the cashback sites would keep this as extra revenue.

moi

PhiltheBear wrote: »

The MSE idea of "it's a bonus"

This is something I find really annoying. One minute Martin/the site is saying 'don't count on cashback/it's a bonus not a guarantee' etc., but the next minute his weekly email (or a tv appearance...) has headline grabbers like 'get broadband for only £6 a month' or 'chocolates for £x', & it's only when you read further you see many of these 'deals' are only special after factoring in cashback. :think:

sellingmysoul666

oh bother thats £26 from rpoints i wont see again :mad:
i have had £440 over the years :j

djb77

I still have £30 pending which has yet to be paid by the merchant does mean that if it does eventually get paid out I will be able get my money or will I lose it.

techspec

Can't believe how lucky i was.

A claim i filed a year ago for £85 was finally confirmed and became payable at the end of October. I clicked to redeem straight away, and it just reached my account last week.

I always claim money as soon as its payable, and after this i am glad i do.

Cleany

Umm, from last weeks email:

Breakdown cover £5 - winter's coming. New Guide!
A year's RAC basic cover £4.77 or AutoAid full service for you & spouse £37
Winter's cold, dark nights are here, meaning breakdowns are tougher to handle. To help, we've re-researched and rewritten our cheapest roadside recovery guide. £5 RAC basic / AA £9: RAC's basic cover is £28 online, but this week you can get £23.23 cashback if you sign up the right way - so the total cost's under £5.

So the best deal there is the best deal because of CASHBACK. I don't see any warning there, nor do I really have to point out that MANY of not most of the "Best Deals" involve cashback.

What about this, from this week's email:

"Safety Rules - only see it as a bonus: Never let the cashback dictate where you spend or what products you get. "

If it's only a bonus then why is it the cause of many "best deals"?

Something's very wrong here.

PhiltheBear

Cleany wrote: »

If it's only a bonus then why is it the cause of many "best deals"?

Something's very wrong here.

I've pointed out elsewhere (much to Martin's annoyance) that some of the promotions are more about generating money for MSE than being quite 100% straight.

I have no problem at all with MSE making money as an affiliate. But it really is very naughty to promote cashback deals if they may simply never happen. At the very least I'd expect a 'health warning' with every such offer.

And I don't like the practice of saying that links with which there is a financial tie in are identified - when if the link is a graphic that rule is ignored.

Don't misunderstand. MSE can save people a lot of money - but it also makes a lot of money when it refers people on.