Credit Card Cash Trick!

zagfles

lisyloo wrote: »

I don't think it's that crazy an idea, if it's explicitly excluded.
If should be totally clear what merchants can do under the agreement.

The law about VAT and mney laundering is pretty clear, otherwise criminals would work round the loopholes (people with access to muh more resources than jsut us).

How could cashback on a credit card be considered "money laundering" any more than cashback on a debit card, which practically every supermarket offers?

I've only heard of one which is Wilkinsons that do credit cards.
Are there others? or are they the only one.

I didn't even know they offered it till this thread. I've only ever got cashback on a credit card abroad.

But do you really think Wilkinsons are breaking the law, or breaking the terms of their merchant agreement?

There is a much more obvious reason that most retailers don't offer cashback on credit cards, and it has nothing to do with money laundering, or VAT, or merchant agreements. It's that they get charged a percentage of the transaction, so why would a retailer give a customer £100 in cashback when they'd only get £97 or £98 back? They aren't changed a percentage for debit cards, just a flat fee usually, so they can get rid of their cash at no cost to them rather than having to bank it.

It's not illegal for a shop to swap 19 pound coins for a £20 pound note, but you won't find many doing it. Wonder why?

Wilkinsons probably do it as a loss leader to encourage customers or as a perk for spending a certain amount.

ETA: see this wiki entry which agrees http://en.wikipedia.org/wiki/Debit_card_cashback

Merchants do not offer cashback on payments by credit card because they would pay a percentage commission on the additional cash amount to their bank or merchant service provider.