3 ms·
I think the whole idea of "Cash back" is insane. Someone, i.e. the consumer, is ultimately paying for these rewards, whether it is airline miles or cashback % o
by spectramax 8y ago
I think the whole idea of "Cash back" is insane. Someone, i.e. the consumer, is ultimately paying for these rewards, whether it is airline miles or cashback % or whatever.
It is a self-propelling idea that would be almost impossible to kill because doing so would make your credit card offering less competitive.
It is also self-propelling from the consumer end. If you don't take advantage of these rewards, you're paying for everyone else's rewards by buying goods and services at a higher price. Some merchants flat out deny certain credit cards such as AMEX.
- AnssiH 8y agoAgreed, I don't think it is a coincidence that here in Finland VISA/MC credit cards don't offer cashback and the merchant fees are much lower than US (Nets offers 0.31% for EU consumer VISA/MC debit cards and 0.9% for EU consumer VISA/MC credit cards). Though I guess lower fraud rate due to chip-and-pin requirement also plays a part.
- kerbalspacepro 8y agoSo, you make a bunch of good points. But consider- some people (most people) can't ever get a "cash back" credit card because of their bad credit. How does that play into your framework?
- ValentineC 8y ago> It is a self-propelling idea that would be almost impossible to kill because doing so would make your credit card offering less competitive. Both the EU and China have introduced legislation that caps merchant fees. This helped with cashless adoption, but also killed off many of the bonus points/miles/cashback offerings.