Business question

Why do supermarkets/pharmacies/etc. encourage you to get cash back when you pay with a debit card? What’s in it for them?

Do they just want customers thinking: “They’re paying me to shop here??? I love this store!”

If so, it’s working.

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10 Responses to “Business question”

  1. zachary Says:

    doesnt it cost you money when you do that also? convience fee? which is oxymoronic

  2. indeedindeed Says:

    nah, i don’t think so. if i don’t have an atm of my own nearby, i’ll get a pack of gum and get cashback.

  3. zachary Says:

    really? can someone verify this?

  4. Kenny Says:

    That’s definitely the truth. I have never gone in strictly to get cash back though. mostly because as a Credit Union member it’s significantly easier for me to find a fee-free ATM. But I definitely use the cash back feature for convenience at the grocery store.

  5. zachary Says:

    javon ringer: all american.

  6. indeedindeed Says:

    perhaps the most random comment in the history of this blog.

  7. zachary Says:

    didnt want to send you the article. hes first team all american with shonn(?) greene of iowa

  8. Donald Todrin Says:

    so whats the answer? Does anybody know? Surely there must be some profit motive beyond providing a service. I remember when gasoline stations used to let you put air into your tires fro free and then it was the machine for a quarter and then a half dollar and now seventy five cents and all in a few years time…Anything in demand deserves a fee and to make a profit… whats the deal here. curious.
    don from Lets talk business, dtod.wordpress.com

  9. Kenny Says:

    Well Jerry admitted that occasionally he will go in and buy just a pack of gum and get cash back rather than pay the fee at an atm, so i guess it does generate some business.

    I personally have never done that, but I have chosen to go to a right aid instead of say a 7-11 because I know right aid offers the cash back option.

    The fact that people utilize it doesn’t necessarily indicate that their is a demand that would sustain a fee. If they charged me a dollar to get cash back I’d just hit up the nearest credit union ATM instead of getting cash back from right aid. But I am in a somewhat unique circumstance in that regard because there is an MSU credit union atm on every corner. In case you haven’t noticed i’m a big proponent of credit unions. Free ATMs throughout the country, the co-op network is a beautiful thing.

  10. indeedindeed Says:

    i have a members CU account still open in TC that i never use, but bank of america is so ubiquitous that i don’t worry too much about finding an ATM in boston. also, what is the rationale for having so many bank locations? is there that much banking still happening in person?

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