Cash from a credit card

KGriff

A Santander 123 credit card pays 2% cash back at certain stores, like Waitrose and 1% on shopping at Sainsburys and Aldi etc.

My wife and I use the card and pay it off in full each month and get back approx £5 to £7 per month, but we also get back a further 3% on the unused cash left in our 123 current account.

When we visit Waitrose, Sainsburys or Aldi, we are often asked if we want 'cash back' as part of the payment for our shopping. We have always declined because we are not sure if we would be charged interest on that cash at a rate of approx 18% or whether it would be seen as part of our shopping bill and we would get a further 1 or 2 % cash back.

Does anyone know how the 'cash back' at stores is seen by the credit card companies in this situation?

Nebulous2

Credit cards don't 'do' cashback. You only really get that on debit cards. If you take cashback on a debit card you wont be charged interest on it - but you will lose interest on the money removed from your account.

Think on it as an alternative to going to the ATM. It means you can combine getting your own money with doing your shopping.

KGriff

I thought you could ask for cashback at the till as part of the shopping transaction no matter if you paid by debit or credit card. Thus the cash would be shown as a store transaction for 'goods' rather than it showing as cash, but if you cannot do it with a credit card and only a debit card, then that is fine.

I have never tried this, the credit card is new, we have only just started to use one, but we have been offered cashback before at stores, but that was probably when we used debit cards... I assumed it applied to any type of card transaction, credit or debit.

Thanks for the quick reply.. We know now not to ask for cashback. This was really just a curiosity thing on our part, thinking we might get 1% cash back on cash withdrawals.

phona

I've found cashiers sometimes ask if I want cashback when I pay by CC, but I think they're jumping the gun and asking as soon as they see a card. I don't think the system would allow them to put the cashback through. I'm not sure though, I've always just declined.

There are some smaller retailers, I'm thinking pubs but there will be others, who manually enter the amount to pay so they could put through a larger purchase on the card and give you the cash. They might well not want to though, and it's moot for supermarkets anyway

Incidentally, since we're a money saving site, have you considered not going to Waitrose?

Cornucopia

Cashback is not available on shop transactions on credit cards.

Any indication otherwise from shop staff is a mistake.

When Santander had a 10% cashback offer at Morrisons, I used a large mixed Debit Card transaction to test the limits of the offer. The results were: groceries, yes (obviously); gift cards, yes (useful at Morrisons with their fuel saver offer); till cashback, no (understandably).

In other words, the transaction obviously comes across with some form of itemisation for cash and non-cash elements, that the bank can use to determine value incentives.

grumbler

KGriff wrote: »

...When we visit Waitrose, Sainsburys or Aldi, we are often asked if we want 'cash back' as part of the payment for our shopping. ...

Not really if you pay by a credit card.

MABLE

Nebulous2 wrote: »

Credit cards don't 'do' cashback. You only really get that on debit cards. If you take cashback on a debit card you wont be charged interest on it - but you will lose interest on the money removed from your account.

Think on it as an alternative to going to the ATM. It means you can combine getting your own money with doing your shopping.

I went to pay in Wilkinsons using one of my credit cards and the assistant asked if I wanted any cash. I advised it was a credit card but she showed me on her screen I could have asked cash back.

I'm sure there is an old thread on here mentioning this before with Wilkinsons.

KGriff

phona wrote: »

Incidentally, since we're a money saving site, have you considered not going to Waitrose?

My wife asks if you are mad ? ... ha ha ... No waitrose, whatever next !! :rotfl:

... the post from grumbler... I think you may have misread my earlier post, I explained I have been offered cashback at the till in the past, but said it was probably at a time when I used a debit card.

Next time we go shopping I will pay with the 123 card and I will ask the cashier if cashback is possible and if so, if that gets itemised differently to the goods on the receipt. My wife seems to think she has been offered cash back with her 'joint' 123 credit card, but declined the offer, but if true, it is possible that the cashier 'jumped the gun' and didn't realise my wife was about to use a credit card rather than her debit card.

Even with all these answers so far, I am still uncertain if there is a loophole here with credit cards... though I would have thought the Banks and Stores would have realised this by now and put a block on it.

Thanks very much to everyone who has replied to my original post.

Cornucopia

The point is that the Banks go to extreme lengths to stop people getting easy access to fee-free cash on their CCs.

For the retailers, it is a question of fees. There is very little virtue in them paying a percentage fee for the cashback in a CC transaction, whereas it makes sense for them to do it in the context of the fixed fee in a DC transaction.

molerat

Some large retailers pay a smaller fee for processing credit card transactions and that small fee can be seen as a small cost to pay for customer satisfaction as well as a slight reduction in the cost, in both time and money, of handling cash. I know from experience that reconciling and counting the smaller cash take took way longer than the larger card take especially with the introduction of integrated POS systems.

grumbler

molerat wrote: »

Some large retailers pay a smaller fee for processing credit card transactions and that small fee can be seen as a small cost to pay for customer satisfaction as well as a slight reduction in the cost, in both time and money, of handling cash. I know from experience that reconciling and counting the smaller cash take took way longer than the larger card take especially with the introduction of integrated POS systems.

What does this have to do with cashback at a checkout?