Cashback rules have changed (for worse) | Neo Financial | Discussion forum

Please consider registering
guest

sp_LogInOut Log In sp_Registration Register

Register | Lost password?
Advanced Search

— Forum Scope —




— Match —





— Forum Options —





Minimum search word length is 3 characters - maximum search word length is 84 characters

No permission to create posts
sp_Feed Topic RSS sp_TopicIcon
Cashback rules have changed (for worse)
January 15, 2022
6:57 am
Alexandre
Member
Members
Forum Posts: 650
Member Since:
November 8, 2018
sp_UserOfflineSmall Offline

Neo Financial quietly changed their credit card cashback rules for some of their partners.

Amazon used to be "2% back, any purchase," now it is "Make any number of purchases totalling $100 within 90 days to get 2% back."
For BestBuy, threshold is $250.

Spend less than that, and any spent older than 90 days is not eligible for 2% cashback.

Screenshot from Neo app on my smartphone, after spending first $9.81 at Amazon under new rules:
Screenshot_20220115-094450.png

You should check your favorite partners/merchants in Neo app to see for whom new cashback rules apply.

I can't find clarification if "expired" purchases will earn 1% or nothing at all. The promise of "earn minimum 1% overall" still remains, but it is not clear how it will be applied to purchases made over 90 days ago.

January 16, 2022
9:52 am
Dean
Valhalla Mountains, British Columbia
Member
Members
Forum Posts: 1048
Member Since:
January 12, 2019
sp_UserOfflineSmall Offline

.
Tangerine CC did a similar 'Bait & Switch' a while back.

They lost a Lot of customers by doing that.

Apparently, that didn't bother them.

Go Figure ❗

Dean

sf-cool " Live Long And Prosper " sf-cool

January 16, 2022
10:38 am
Norman1
Member
Members
Forum Posts: 5026
Member Since:
April 6, 2013
sp_UserOfflineSmall Offline

I don't think it bothers Tangerine because it is better for them to lose the business than to keep the business and lose money on it.

I suspect Tangerine was losing money with their original 2% back on select categories and 1% back on the rest.

The current interchange on a standard MasterCard is 0.92% for chip-and-PIN charges and 0.87% for tap charges. For eCommerce, it is 1.67%.

It won't work out for the MasterCard issuer if most of the spending is in-person and not online.

January 16, 2022
11:50 am
HermanH
Member
Members
Forum Posts: 442
Member Since:
April 14, 2021
sp_UserOfflineSmall Offline

Norman1 said
The current interchange on a standard MasterCard is 0.92% for chip-and-PIN charges and 0.87% for tap charges. For eCommerce, it is 1.67%.

Norman1, you seem well versed on interchange rates.

As an aside, do you know the rates paid by governments when city property or federal income taxes are paid?

Do they incur a fee based on percentage or flat fee?
Is there any difference between payment via e-bank transfer, atm bill payment, interac, or other method?

January 16, 2022
1:21 pm
file
Member
Members
Forum Posts: 118
Member Since:
August 1, 2015
sp_UserOfflineSmall Offline

Interchange rates are public for Mastercard and Visa so you can look and see.

In general all the different payment mechanisms will incur different fees.

January 16, 2022
3:10 pm
Norman1
Member
Members
Forum Posts: 5026
Member Since:
April 6, 2013
sp_UserOfflineSmall Offline

The actual rates paid by the merchant or the government are negotiated with their bank. However, the interchange fee and the network fee have to be covered somehow in the negotiated price.

For example, the federal government is not going find any bank willing to offer a flat $2 per payment to accept online income tax payments by MasterCard. That's because if someone uses their World Elite MasterCard to pay $5,000 of income tax online, the card issuer would be entitled to interchange of 2.13% = $106.50 and MasterCard Canada would collect a network fee of 0.08% = $4.00.

Yes, there is a big difference between payment methods. Pre-authorized debit, bill payment, and Interac debit are fixed fee and inexpensive. In contrast, credit cards, MasterCard debit, and Visa debit have percentage fees and are more expensive. That's why governments tend not to accept the latter three methods for politically sensitive payments like property taxes or income taxes.

I know one city that does offer online credit card payments for property taxes. The catch is that the property tax payment goes through Paymentus and there is a 1.99% service fee.

Interchange and network fees are just what the credit card issuer and card network (like MasterCard) receives. Those don't include the markup by the merchant's bank or the cost of the credit card terminals.

January 16, 2022
3:21 pm
pooreva
Member
Members
Forum Posts: 329
Member Since:
April 2, 2018
sp_UserOfflineSmall Offline

Norman1 said
I know one city that does offer online credit card payments for property taxes. The catch is that the property tax payment goes through Paymentus and there is a 1.99% service fee.

Why would ANYBODY pay property taxes or any utility bill by credit card if there is an additional fee?
Yes, I would like to pay my prop tax, electricity, gas, water by CC but with no fee.

January 16, 2022
3:38 pm
HermanH
Member
Members
Forum Posts: 442
Member Since:
April 14, 2021
sp_UserOfflineSmall Offline

Norman1 said
The actual rates paid by the merchant or the government are negotiated with their bank. However, the interchange fee and the network fee have to be covered somehow in the negotiated price.
[snip]
Yes, there is a big difference between payment methods. Pre-authorized debit, bill payment, and Interac debit are fixed fee and inexpensive. In contrast, credit cards, MasterCard debit, and Visa debit have percentage fees and are more expensive. That's why governments tend not to accept the latter three methods for politically sensitive payments like property taxes or income taxes.

I understand that the fees for CC payments are prohibitive. Any idea what a municipal government pays to allow citizens to pay via debit or bill payment? I couldn't find anything for Edmonton, but figure most municipalities would pay a similar rate. Commercial Debit/Interac is usually per transaction. I don't know about the bill payment method.

January 16, 2022
8:46 pm
Norman1
Member
Members
Forum Posts: 5026
Member Since:
April 6, 2013
sp_UserOfflineSmall Offline

I wouldn't say credit card fees are prohibitive for property taxes or income taxes. It's just politically very sensitive to raise property or income taxes by 2% or so for everyone in order to allow some taxpayers to collect reward points on their tax payments.

That city, that allows online property taxes to be paid online by credit card for a fee of 1.99%, also allows them to be paid by Interac Online debit for a flat fee of 49¢.

A relative told me that the city allows in-person Interac debit payments of property taxes for no extra fee. So, I assume those cost the city about the same as or less than accepting a cheque for the property taxes.

I don't have any prices for what are known as bill payment remittances. Bill payment remittances are handled by the same Payments Canada system that direct deposits and pre-authorized debits are.

January 16, 2022
9:22 pm
smayer97
Member
Members
Forum Posts: 531
Member Since:
September 29, 2017
sp_UserOfflineSmall Offline

An aside, if you want to pay utility bills, property taxes, and more using a credit card, pay no extra fee AND get rewards, look at the CDN Tire MC. Up to 1% in CDN Tire money for all the above (if you qualify for the World Elite card, else it is 0.5% (IIRC)).

January 16, 2022
9:54 pm
smayer97
Member
Members
Forum Posts: 531
Member Since:
September 29, 2017
sp_UserOfflineSmall Offline

ON credit card charges, also note that merchants have to pay a monthly service fee to access the MC / VISA/ Amex, etc network and have the cost of buying or renting the equipment for scanning/tapping/swiping the card.

January 17, 2022
7:11 am
KamWest
Toronto
Member
Members
Forum Posts: 228
Member Since:
December 20, 2019
sp_UserOfflineSmall Offline

MBNA did the same a while back, was 2% back on almost everything now it is within a category of 50k max.

Most of mine was in the same category so I topped out when I reached 50k in purchases.

January 17, 2022
8:19 am
savemoresaveoften
Member
Members
Forum Posts: 1321
Member Since:
March 30, 2017
sp_UserOfflineSmall Offline

smayer97 said
An aside, if you want to pay utility bills, property taxes, and more using a credit card, pay no extra fee AND get rewards, look at the CDN Tire MC. Up to 1% in CDN Tire money for all the above (if you qualify for the World Elite card, else it is 0.5% (IIRC)).  

yup, have done that for a few years now. Thats the main use of that credit card for me. I just have to find things to buy with all those CT money lol. It is good that you can spend it at Sport Chek and other CT owned brand as well.

p/s I use it for property tax, enbridge, alectra, university tuition. The CT money adds up quickly.

January 17, 2022
10:54 am
Dean
Valhalla Mountains, British Columbia
Member
Members
Forum Posts: 1048
Member Since:
January 12, 2019
sp_UserOfflineSmall Offline

smayer97 said

An aside, if you want to pay utility bills, property taxes, and more using a credit card, pay no extra fee AND get rewards, look at the CDN Tire MC. Up to 1% in CDN Tire money for all the above (if you qualify for the World Elite card, else it is 0.5% (IIRC)).  

savemoresaveoften said

yup, have done that for a few years now. Thats the main use of that credit card for me. I just have to find things to buy with all those CT money lol. It is good that you can spend it at Sport Chek and other CT owned brand as well.

p/s I use it for property tax, enbridge, alectra, university tuition. The CT money adds up quickly.  

Another similar option is the Capital One MC, but I think it might be a bit better than the CT MC . . .

Our no-fees Capital One MC ('Aspire Cash' version) pays 1% Reward on All purchases & payments. And that 1% reward can be paid out in Cash-Money, at any time. Instead of taking the cash though, we usually just use it to paydown our balance due.

To each, their own.

    Dean

sf-cool " Live Long And Prosper " sf-cool

January 17, 2022
1:58 pm
smayer97
Member
Members
Forum Posts: 531
Member Since:
September 29, 2017
sp_UserOfflineSmall Offline

Except many (most?) utilities, taxes, insurance, etc cannot be paid using most credit cards. The uniqueness about CDN Tire is that they make the payment appear to the receiver as a payment from a bank account. So, they have no idea a credit card is being used. So you can still pay using the CDN Tire credit card.

January 17, 2022
2:01 pm
Loonie
Member
Members
Forum Posts: 8229
Member Since:
October 21, 2013
sp_UserOfflineSmall Offline

There was an earlier, detailed, thread, about how to take advantage of the Cdn Tire CC if anyone wants to pursue it.

January 17, 2022
6:10 pm
Norman1
Member
Members
Forum Posts: 5026
Member Since:
April 6, 2013
sp_UserOfflineSmall Offline

The special bill payment facility of the Canadian Tire Triangle MasterCards was discussed in Paying tax, utility, and insurance bills with Canadian Tire credit cards.

January 18, 2022
9:25 am
Dean
Valhalla Mountains, British Columbia
Member
Members
Forum Posts: 1048
Member Since:
January 12, 2019
sp_UserOfflineSmall Offline

smayer97 said

Except many (most?) utilities, taxes, insurance, etc cannot be paid using most credit cards. The uniqueness about CDN Tire is that they make the payment appear to the receiver as a payment from a bank account. So, they have no idea a credit card is being used. So you can still pay using the CDN Tire credit card.  

The only thing I can't pay with my Capital One CC is the balance owing on my income tax, and my property tax. And I have my income tax planned out most years, so that the balance owing is only a small amount.

I'll take 'Cash' over that CT FunnyMoney ... Any Day ❗ sf-smile

My two nickels,

    Dean

P.S.
Our other CC is with Tangerine. With that we get 2% Cash-Back on Groceries, Gas & Reoccurring Bills.

sf-cool " Live Long And Prosper " sf-cool

January 18, 2022
2:18 pm
savemoresaveoften
Member
Members
Forum Posts: 1321
Member Since:
March 30, 2017
sp_UserOfflineSmall Offline

Dean said

The only thing I can't pay with my Capital One CC is the balance owing on my income tax, and my property tax. And I have my income tax planned out most years, so that the balance owing is only a small amount.

I'll take 'Cash' over that CT FunnyMoney ... Any Day ❗ sf-smile

My two nickels,

    Dean

P.S.
Our other CC is with Tangerine. With that we get 2% Cash-Back on Groceries, Gas & Reoccurring Bills.  

Dean said

The only thing I can't pay with my Capital One CC is the balance owing on my income tax, and my property tax. And I have my income tax planned out most years, so that the balance owing is only a small amount.

I'll take 'Cash' over that CT FunnyMoney ... Any Day ❗ sf-smile

My two nickels,

    Dean

P.S.
Our other CC is with Tangerine. With that we get 2% Cash-Back on Groceries, Gas & Reoccurring Bills.  

it will be the holy grail if a card allows income tax payment ! Property tax is second best (my property tax is higher than all utilities combined in a year).

Do agree cash is better than the CT money, not sure if I want to get the capital one CC just for paying the other utilities tho (I cancelled my 2% capital one CC last year as they keep devaluing the rebate to a point its no longer superior)

Do you know if the capital one CC allows university tuition payment ? If so that will be golden to me !

January 18, 2022
2:27 pm
Dean
Valhalla Mountains, British Columbia
Member
Members
Forum Posts: 1048
Member Since:
January 12, 2019
sp_UserOfflineSmall Offline

savemoresaveoften said

. . .

Do you know if the capital one CC allows university tuition payment ? If so that will be golden to me !

I'm sure Capital One would be fine with it, but it's up to the university ... you'll have to ask them if they can accept tuition payments by CC.

    Dean

sf-cool " Live Long And Prosper " sf-cool

No permission to create posts

Please write your comments in the forum.