MSE News: RBS and NatWest launch limited cashback on debit cards: is it any good?

Tigsteroonie

Given the list of retailers, we'll probably only earn cashback through Tesco purchases (which I note is a NatWest promo/giveaway and not Tesco's involvement). But as they say - every little helps!

zerog

pinkdalek wrote: »

All I know is it is for current account customers who use debit card and have their main banking relationship with them.

What would a "main banking relationship" be? Having 2 direct debits for £1 to a savings account paid and having £750 in the account for 10 seconds per month?

Would the cashback be given online too, i.e. would you be able to double dip with topcashback and potentially the shop's own loyalty scheme?

Herbalus

caoimhin wrote: »

It may be better or it may not - time will tell - I guess its good you love your employer so much that you're bigging up a scheme that's not even started yet and disparaging the competition.

This first part is true, though if you look at popular opinion on the RBS cashback, it wouldn't be difficult to think that another bank could introduce a better one. It's a nice, headline-grabbing idea from them, but it won't affect too many people because the retail list isn't very exhaustive.

dalesrider

caoimhin wrote: »

So basically you work for H'fax which is how you know its going to happen and you're giving you're employer free advertising by claiming it's going to be better than an existing claim with absolutely nothing to substantiate this.

It may be better or it may not - time will tell - I guess its good you love your employer so much that you're bigging up a scheme that's not even started yet and disparaging the competition.

Well unless said poster is someone from the Social Media team. They may find themselves in very hot water for releasing sensitive marketing data.

End of the day while you may go for a cashback credit card. Switching your whole banking just to get a few £ is a very large step to make.

pqrdef

dalesrider wrote: »

Switching your whole banking just to get a few £ is a very large step to make.

The government is still hell-bent on competition, and there won't be any if people don't start switching at the drop of a stuffed meerkat.

The new divestment kids on the block will have to come up with something good, or it'll be all over if they start draining customers from their oversized branch networks.

Tesco and Virgin are still polishing their long-promised offerings, and the PO/BoI product won't be worth a full launch if they don't improve it.

And then the government plans to bring in more players by smashing the big banks' monopoly of the payments system.

There are going to be a lot of gimmicks. So the customers had better be interested in gimmicks.

Hominu

I've heard of this scheme, but its slightly different to how credit cards work:

With a credit card, you are getting cash back from the card issuer due to the fact they are getting merchant fees, etc. Some gives you back more than they get in fees, but its still sustainable thanks to there other customers failing to pay, interest on balances, etc.

With a debit card, the cashback will be paid by the retailer, and can be different per retailer. Its equivalent to purchasing through a site such as Topcashback or Quidco and paying with a debit card.

Of course, each banks particular scheme could be different to the above.

pqrdef

The interesting new facet of this scheme is that you have to pay with the debit card. Retailers who sign up to affinity and loyalty schemes don't normally care how you pay, they're more interested in how you come to buy. But of course 1% cashback on a debit card payment is cheaper for them than a credit card fee.

In fact the more business the credit card issuers win with their cashback schemes and 0% offers, the more it costs the retailers as more people pay for more shopping by credit card.

But the retailer doesn't care which debit card you pay with. So it'll be open to customers to say look, you'd give me 1% cashback if I pay with this NatWest card, so can't you just knock me 1% off if I pay with this HSBC card?

And of course it's open to retailers to offer a straight 1% off all debit card payments without bothering to sign up to any bank scheme.

I don't really see where NatWest get an edge here unless they're going to keep sweetening the deal with offers that they pay for themselves.

JuicyJesus

pqrdef wrote: »

But the retailer doesn't care which debit card you pay with. So it'll be open to customers to say look, you'd give me 1% cashback if I pay with this NatWest card, so can't you just knock me 1% off if I pay with this HSBC card?

And of course it's open to retailers to offer a straight 1% off all debit card payments without bothering to sign up to any bank scheme.

I don't really see where NatWest get an edge here unless they're going to keep sweetening the deal with offers that they pay for themselves.

...what?

There is absolutely no incentive for shops to offer a discount to EVERYONE paying on a debit card. What you're saying is that because NatWest are rebating a certain amount of money as part of a scheme, retailers should now automatically rebate another amount of money out of their pockets too to everyone. That's nonsense.

dalesrider

pqrdef wrote: »

The government is still hell-bent on competition, and there won't be any if people don't start switching at the drop of a stuffed meerkat.

They are.
But as we have seen in the last 12 months. With all the major system outages at various banks.
How many people despite all the moaning actually moved?

The new 7 day switching service is a start. But we are now seeing that it has not been fully thought out and just how payments to and from old to new account are going to be actioned. Has yet to be resolved....

pqrdef wrote: »

The new divestment kids on the block will have to come up with something good, or it'll be all over if they start draining customers from their oversized branch networks.

I think many people will soon get sick of all the gimmicks that will be coming out from these new players?
Who we have yet to see who they maybe.

Setting up a new bank is never going to be cheap. So there is a very limited amount of players that might think its worth the risk.

pqrdef wrote: »

Tesco and Virgin are still polishing their long-promised offerings, and the PO/BoI product won't be worth a full launch if they don't improve it.

As above. They are really going to have to plan out how and what they want to do, and what part of the market they want to target.
There biggest issue is going to be the systems that they will have to use to run their banks systems.
Not exactly something you can buy off the shelf and have up and running overnight.
Never mind training staff to use them.

One thing many people complain about is the quality of front line staff.
You cannot simply pull someone off the street and give them a script to handle calls.
So you are looking at weeks of training just to get basic skills. Never mind training in the various departments.

pqrdef wrote: »

And then the government plans to bring in more players by smashing the big banks' monopoly of the payments system.

Will be interesting to see just how many new players come to the market.
What scares me. Is we will end up like USA where banks go bust on a weekly basis.....
Is this what we want to see?

pqrdef wrote: »

There are going to be a lot of gimmicks. So the customers had better be interested in gimmicks.

Personally, and I bet a lot will agree. Its not gimmicks that we want. Its hassle free, easy to use banking. With any issues resolved in a quick and easy manner.

JuicyJesus

Will be interesting to see just how many new players come to the market.
What scares me. Is we will end up like USA where banks go bust on a weekly basis.....
Is this what we want to see?

The US' system is drastically different from ours, mainly to do with the wildly different geographical sizes and the respective histories and ideologies of the nations (the US' political thought is, overall, very much of a bent towards decentralising everything and things being done on a local level.)

The chances of us sprouting an extremely localised banking infrastructure such as theirs are very slim.