Updated 8/27/15
As many of you are aware, yesterday the news was breaking that most cashback shopping portals switched the terms on the purchase of Amex gift cards to only include cards in denominations of $200 or less.
Previously, many of us enjoyed buying Amex gift cards at 2-2.25% cashback from the portal and used this as a way of increasing the profits on all our spend, or manufactured spend.
A while back, the portals limited cashback to cards in denominations of $2000 or less. At that point, it was still profitable to purchase the $2k cards. Now that they’ve limited the cashback to just $200 cards, it wouldn’t be feasible to use these cards for our purposes since the card activation fee will make it too expensive.
Let’s take a look at the portals which we were most commonly use to order Amex gift cards with 2-2.25% cashback:
- Topcashback Typically, they offer 1.5% and they increase their rate to 2.25% a couple of times per month. Topcashback was the first, yesterday, to tell us about the new $200 limit.
- BeFrugal Typically, they offer 1.5% and they increase their rate to 2.2% a couple of times per month. They held out for a few more hours, then they pulled Amex gift cards completely for a few hours. Now, they’ve added it back – with the $200 caveat.
- Simply Best Coupons Typically, they offer 1.5% and they increase their rate to 2% regularly. They’ve now added the $200 limit.
- Ebates They were the last holdout here – they didn’t chang the terms for a while, but they’ve now added in the $200 limit as well.
The bottom line is that this is apparently a shift in strategy on the part of Amex to stop paying out on large gift card denominations. We must not have been profitable for them and they decided to end it.
That does not mean that it’s gone forever. It’s quite possible that they’re testing out their profitability to see which way works better for their bottom line. It seems reasonable to assume that the terms will stay this way for at least a few months, as they run the test, but it’s always possible that it’s just a temporary thing which will pass in a few days.
Assuming it is a few-month test, then we’ll only know then what the ultimate decision is and whether it will remain this way for good.
(Off to next gig…)
