Posted by William Charles on December 13, 2017
Bank Account Bonuses

Published on December 13th, 2017 | by William Charles

164

Discover Checking 1% Cash Back On All Debit Card Purchases ($3,000 Cap)

Discover made an update to their Discover checking account on December 13th, 2017. This account now earns 1% cash back on all debit card purchases with a monthly cap of $3,000 in spend ($30 cash back). There are some restrictions to what will earn the 1%, the following exclusions apply:

  • ATM Transactions, cash over portions of point-of-sale transactions, and Peer-to-Peer (P2P) payments are not eligible for cashback rewards. Purchases made using third-party payment accounts (services such as Venmo® and PayPal™) may not be eligible for cashback rewards.

Previously this account earned $0.10 for each debit card purchase, bill payment & check cleared (up to $10 per month). It’s possible to get 2-3% cash back on all purchases by using a credit card but this is still significant for a couple of reasons:

  • Not everybody has access to a credit card
  • Some purchases charge different fees based on whether you’re using a credit or debit card. For example when paying your taxes using a debit card is a flat fee of $~2.5 and using a credit card has a fee of ~2%.

Rewards earning debit cards used to be relatively common until the Durbin amendment came into affect, this limited the fees retailers could be charge for debit card processing. The old program is better for all purchases under $10 and the new program is better for all purchases over $10. Discover has offered a sign up bonus on their checking accounts before, but this hasn’t been offered for some time. They currently offer a bonus of up to $200 on their savings account.



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164 Comments on "Discover Checking 1% Cash Back On All Debit Card Purchases ($3,000 Cap)"

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YRK
YRK

For small purchases(<5$), the current method is better.
Though for places not accepting CC, its good news for consumers

Rene
Rene

I can confirm that the current rewards checking will be replaced with this new structure too. I got a notification when locking into my account.

For comparison, the current system gives me $0.10 for each bill payment or cleared check, up to $10.00/month. This doesn’t make you rich, but personally, I consider this more useful than the 1% cashback.

joE
joE

Is there a minimum amount the billpay has to be? how do you maximize this by sending bunch of small billpays everyday?

Rene
Rene

Minimum for Bill Pay is $1 — no specific minimum to receive the reward.

Credit
Credit

Thanks doc. You the best

Jack
Jack

I will open up this account and use the debit card for buying $1000 money orders at Walmart, they cost 70 cents each and the cash back will be $10 so the profit is $9.30 for each money order. I will buy two $1000 money orders every day, giving me a daily profit of $18.60 and a monthly profit of $558. This will be my starting level, I will scale up after a successful month.

I have a good relationship with a small local credit union, I’ve talked to the compliance officer about my money order deposits and he is fine with it, all he has to do is skip my name in the report their AML software generates, he’s also talked to his managers and they are ok with it because I keep the money from the deposits in the account for about two weeks before I withdraw it so they are able to profit off investing/loaning my balance.

Scaling this up will increase my capital requirements because I need to keep the money from the money order deposits in the checking account for two weeks to make the credit union happy. I’m ok with removing money from a 1% savings account to give myself the needed capital though, this endeavor will return more.

One of the major factors that will make this much more capital intensive than credit card manufactured spending is that the money will need to be replenished to the discover checking account immediately to continue buying money orders. When I MS with credit cards, I can time the VGC purchases right after the statement closing date so I won’t have to pay back for 3-4 weeks, this greatly reduces capital requirements because I am able to let the funds sit in the checking account for two weeks without needing to pay the credit card back assuming everything is timed properly.

My Walmart cashiers will be in for a shock when I go buy 2 $1000 money orders but charge it all on one card instead of splitting it 4 ways, $500 on each VGC.

Credit
Credit

What is AML activity log?

sirtheta

Anti-money laundering.

calwatch
calwatch

Because of this I expect a cap. I think keeping the $10 a month would be reasonable, or upping it to say, $30 a month. Discover can be bright occasionally – like shutting down people who took too much advantage of that double cash back deal by buying gift cards.

AP
AP

Uhh. You don’t think that Discover will exclude PIN transactions?

Jim
Jim

lmao you have to be kidding, they’re not gonna count PIN transactions

Justin
Justin

Well Jack just laid out what we were all thinking.. haha

artgriego
artgriego

acting like he invented the light bulb or something

Ferris
Ferris

You can only get $10 cash back per month. For as big of a pain in my butt going to Walmart is (minimum 5-10 minutes waiting to check out), I don’t think that’s worth even close to $10. Especially when I’m not hitting Minimum Spend requirements…it’s just a lousy debit card. Also, the Examiners will see that AML report and question why the CU isn’t reporting you.

CtownBin
CtownBin

I’d be shocked if this works. Like most debit card rewards offers, it will probably exclude PIN transactions, and so buying MOs will not work. Chances are there won’t be much utility for people who read this blog. I’d be happy to be wrong of course 🙂

JASON
JASON

Structuring and money laundering?

Dylan
Dylan

Something tells me this won’t work. And if it does work, it probably won’t work for long. I could easily see discover coding money orders as not eligible for cash back.

David Davidson
David Davidson

Do you ever stop and think that what you’re doing isn’t profitable enough? I mean, daily trips to Walmart is bad enough, since I refuse to step foot in them anymore – but on top of that you are carrying the risk of holding on to a $1,000+ money order every day. All that profit over the course of months could go down the drain if someone decides to rob you – or if you drop it – or if you forgot it somewhere.

adam d
adam d

seems like a lot of time for a less than ideal profit. day trade crypticurrency for a day, theres a good chance youll make as much as that guy will running around avoiding the untouchables at walmart for months.

dizzy
dizzy

I’m interested in crypto but not sure where to start, what I’ve read goes over my head. Any good links that explain?

TomT
TomT

Your kidding, right? Day trading cryptocurrency means you are just as likely to lose and earn.

IOException
IOException

Exactly. A lot of people on this site really don’t seem to value their time.

I mean, some of these schemes are worse than minimum wage…

csb
csb

cool story bro

tyrone
tyrone

This is comedy gold.

darb
darb

Money orders don’t count toward cash back…

Vic
Vic

Woah, this is amazing.

I’d think this would make things too easy..
I’ll definitely give it a shot when it begins. Hopefully they delivers what’s promosied.

Jim
Jim

This scheme is no good… The current scheme lets me earn $120/year for $1200 /year spent (0.1c per dollar). The new scheme I have to spend $12000/year to earn $120 (or 0.01c per dollar).

Jacinto
Jacinto

Your bill payments, debit card transactions and checks are rewarded for normal everyday transactions. As noted in the Deposit Account Agreement, we reserve the right to adjust the amount of your rewards or close your account due to irregular, unauthorized or fraudulent activity in your Checking Account. For example, splitting up one standard monthly bill payment into several payments to receive $0.10 per payment is deemed as irregular activity as it’s not standard bill payment practice. The same holds true for debit card transactions. Asking a merchant to swipe your debit card repeatedly for each item at checkout instead of using your debit card to make a complete purchase of items at one time is recognized as manufacturing transactions and not normal everyday debit card behavior.

joE
joE

Are you saying this or is this ALL in the terms somewhere?

Vince
Vince

It is in the Terms and Conditions of the Discover checking account.

Nah
Nah

They’re probably going to offer 5% back on transactions in the first week after signing up for this account. Can’t confirm this one way or another, but that’s the word on the street.

Their audience with this is millennials who are familiar with cash back, and who don’t write checks.

Thomas Tullis
Thomas Tullis

Why would you even need to go to the trouble of money orders if you can use cash app or venmo or paypal or even snapcash or facebook cash… I think all those programs accept debit w/ 0 fee.

JASON
JASON

Considering the amount he’s doing, I don’t think Paypal or Venmo allows that.

Scott
Scott

This is disappointing. I would put small transactions on this debit card in order to earn >3% (or >5%) cash back. I remember fondly their promotions of $0.20 per transaction.

I’ll be reduced to only one flat-rate rewards debit card: Salem Five eOne checking, $0.05 per signature-based transaction. Funny, I was just about to close my accounts there. I suppose I still will close the savings account, then maybe reopen it later at an updated, competitive savings account rate.

Josh m
Josh m

Does this mean we will no longer get 10¢ per bill pay or check? Not much but I normally got a couple bucks a month using discover bill pay.

Dan
Dan

If they convert existing customers, yes. But that is not clear yet.

Ryan Goldstein

Screenshot showing the changes after logging in: https://i.imgur.com/nVnpUIz.png

Here are the terms applicable to the 1% cash back: “ATM Transactions, cash over portions of point-of-sale transactions, and Peer-to-Peer (P2P) payments are not eligible for rewards. Purchases made using third-party payment accounts (services such as Venmo® and PayPal™) may not be eligible for rewards.”

JT
JT

It’s so weird to me that people have Discover deposit products without a big error message at the top saying that you need to update personal information. Myself and Discover have been trying to update my personal information for weeks now, and nobody can figure out why it hasn’t been able to.

AP
AP

MIne went away when I updated my citizenship information

JT
JT

I would update my citizenship information if I could, but I am unable to.

Bill M
Bill M

If they take away the 10 cents per bill pay and check written, I will quit using Discover as my primary checking account. I knew this was unsustainable for Discover since I earn a few dollars per month, they are definitely losing money on my account. I doubt they will pay 1% on PIN based transactions so I don’t see anything useful about the new program. Time to find a new checking account.

Rene
Rene

I’ve got a notification about changes of the ToS: for existing accounts, the rewards structure will change to this new 1% of debit transactions on 11/01. I don’t see any reason why this wouldn’t apply to new accounts too.

Dylan
Dylan

I just applied for their rewards checking thinking I was going to use this card for small purchases <$5. After reading the 1% unlimited cash back, It was very disappointing. Until I learned my landlord allows me to pay my rent with a debit card.

My rent is around $700 a month and I can charge it to a credit card (2.75% fee) or a debit card. The debit card has a $1.50 flat fee no matter the transaction value.

I could pay my rent using the debit card and eat the $1.50 fee. since my rent is around $700 I should earn $7 cash back from doing this. Subtracting the debit card fees from my landlord leaves me on top with $5.50 from the cash back.

This could be VERY interesting, and if anybody else has to pay rent and their landlord accepts debit cards for a flat fee this could be a good way to go. Just open an account with discover and have automatic ACH transfers into the account sometime mid-month. Then schedule auto-payments with your landlord (mine uses a 3rd party payment processor) and you are making a tiny amount of passive income doing this, since after it's set up there is no active management that needs to be done.

Stephen Matrese
Stephen Matrese

I’m really disappointed by these changes. My family keeps about $85,000 in Discover Savings accounts at 1.25% when we could be earning 1.20% at Ally Bank or 1.30% at CIT. The family (5 of us) have 13 checking accounts and, in theory, could receive a total of $130 under the current system. This 1% thing is no better than PayPal debit (if you spend at least $100/month) or my Discover Credit card, which has 2x match (2% effective cash back) for the first year (assuming it isn’t in the bonus category.

My local credit union gives me 5 cents per debit card transaction. I haven’t found any other bank that offers anything for checks or bill pay. If anyone knows about any, please reply to this comment.

My wife and I are disabled and we managed that large sum of money of behalf of another family member (Power of Attorney). We personally make only $1123/month between SSDI and two SSI payments. That up to $10 per account was really nice to have. I really wish that I had fully taken advantage of it for the years they offered it. I’ll be sure to maximize it for the next month and a half. They, my money and the money I manage will never see a Discover account again.

I wish they would offer something better than 1% with tons of exclusions.

Stephen M
Stephen M

Correction, 1.35% at CIT Bank

Mser
Mser

You can be earning a lot more by setting up checking accounts at Lake Michigan Credit Union (3% up to $15K), Evansville Federal CU (3% up to $15K) and New Buffalo Savings Bank (2.24% up to $35K). All have various monthly debit card transaction requirements but relatively easy to meet (ie, Amazon). Can set up an account for both you and your wife and your family member. Could be earning $212.50/mo with $85K in deposits with 3 accounts each at LMCU and EFCU.

Sam
Sam

Bummed the 10¢/swipe is ending! I love getting an afternoon snack and thinking “Ha, ha! I pretty much got this doughnut tax free!!” Oh well, back to using my 2% card for my junk food cravings.

Jeff
Jeff

Welp, I’ll be moving away from Discover to a checking account with interest sometime soon. Loved the $.10/bill pay, 1% on debit purchases does nothing for me. Sad day.

anne
anne

Disappointing also. I have enjoyed the $.10/bill pay, cleared check, or debit card transaction because I have to make bill pays anyways.

Superchurn
Superchurn

As a reminder, Citi allows CC payments with a debit card…

1% when spending on Citi DoubleCahs, 1% when paying it back, and 1% on the payment if paying with a discover debit card…

3% isn’t too bad

JASON
JASON

Hello, can you advise how to make a debit card payment towards Citi CC? By phone only?

Superchurn
Superchurn

I believe so yes. I tried to make one by phone using a VGC, and stupidly told them the name on it was Giftcard Holder, and they refused.

But this would be a legitimate bank debit card, so it whould work

Dan
Dan

Did anyone try making a payment to citi yet with Discover? I tried and they said the debit card was invalid. Wanted to know if anyone had any success and if the 1% was rewarded

Oliver
Oliver

Thanks for the info – this will make me a few extra $ when the 1% kicks in 🙂

Draskinn
Draskinn

So can I use this to pay my Chase credit card? I try to funnel all my expenses through my cash back cards so if I could get an extra 1% paying them off too that would be a nice bonus.

Connor
Connor

Interestingly enough the page has since reverted back to how it was previously, perhaps this won’t be rolled out as quickly and they want to keep accepting new accounts in the meantime.

arch
arch

I looked here for a list of banks that allow CC payment with a debit, no luck. Is there one or should we start a list? Citi is the only one I know for sure.

JASON
JASON

Consumer Credit Union has something called Express payment to the credit card where you can pay using a debit card towards your Consumer Credit Union CC. I’ve been using PPBDC to pay and earn cash back that way. Please note CCU express pay charges $3.50 per transaction, so your cash back should be greater than that to make sense to use a rewards debit card to make payment. And if you are using PPBDC to pay, keep in mind that your daily max. purchase is $2000, meaning if you CCU CC balance is $4100, you need 3 days to make the full payment: Day 1: paid $1996.5 plus $3.5 fee=$2000 purchase, earned cash back $20 by 10th of the following month, posted to your paypal account. Day 2: same. Day 3: left with a balance of $107 and not worth to do it that way as your PPBDC cash back is only $1.07 vs. the $3.5 fee. For some of you may not know, this method was also good to MS in CVS while PPMC was live. That being said, before 5/3/2017, used CCU CC to buy PPMC, load the fund into paypal account, use PPBDC to pay back via Express pay to the CCU CC. a total of 2% cash back with fees of $3.95 per $500 value of PPMC and $3.50 per $2000 overall PPBDC. This is slightly better than 2% Citi Double Cash as Double Cash is that you earn the other 1% on the payment which is 2 months after.

There is a comment above stating that Citi also allows Debit card payment, not sure how though as I just heard it too. I remember some time ago, some Capital one user can also see the options of using debit card to pay CC after login. But this is totally YMMV.

Eduard
Eduard

This is perfect! I had to spend $1k on the CCU card anyway… Usually would buy $2k from giftcards.com to meet the requirement. Does this still work? I just ordered my Paypal business debit card. Thanks for the very useful info!!!

culinarykid92
culinarykid92

I don’t think I saw a comment on them changing it back. I reached out to Discover on twitter (as I may open if the bill pay and checks are here to stay at 10 cents each). When the page was showing, they said the 1% on debit was replacing the entire system. But since the reversion of the page, I reached out again to see if they decided against it, maybe out of public/customer frustration. Still waiting and will update if they let me know.

Bman3020
Bman3020

I spoke with a Discover rep on Saturday and he said everything has been put on hold until after the first of the year. He said there is not a date set yet but that it will still be implemented. Obviously this is a fluid situation but it sounds like the existing format will be around a little longer. I

Dylan
Dylan

It’s probably cause discover read the comment section of your previous post and said “oh crap we need to add more clauses to what won’t count” because they saw everyone was gonna exploit this lol.

NinjaX
NinjaX

the real funny part is that your joke is probably the truth…

Matt
Matt

DP from a secure message on 9/22/17:

“Thank you for your message and for your business with Discover Bank. We regret any confusion or inconvenience. At this time, your rewards program remains unchanged and you will continue to earn the same 10-10-10 Cashback Checking Bonus that you enjoy today. Should we make any changes to the rewards program, we will be sure to notify you in advance.

We hope you continue to enjoy the rewards features of your account and appreciate your business.

If you have additional questions, click on the Help section of the Account Center, reply to this message or call us at 1-800-347-7000. Our 100% U.S.-based customer service team is available 24 hours a day, 7 days a week.

And remember?there is so much you can do through DiscoverBank.com!
-Sign up for email, text, and push alerts
-Schedule and manage online transfers
-Pay bills through our no-fee Online Bill Pay feature
-Update your personal profile
-Upload documents via Secure Document Upload

Thank you for choosing Discover.

Sincerely,

Denise

Discover Bank Customer Service”

Luke
Luke

Thanks for the DP!

Sam
Sam

Ha ha! Just this morning, I got this. So, they can’t make up their minds!

“Message from Discover Bank related to a change in terms

Dear Sam,

Effective November 1, 2017, we are making changes to our Deposit Account Agreements. Please log into the Account Center at Discoverbank.com and click on one of your deposit accounts to access your message and view complete details.

Thank you for choosing Discover.

Sincerely,

Discover Bank Customer Service”

Vijay
Vijay
Below is what I got from Discover this morning about the changes that goes in effect from November 1st 2017. I do not see any changes to “Cash back reward” Thank you for choosing Discover Bank. We appreciate your business and are here to help you bank better. We are notifying you of several changes to the agreement that governs your deposit account(s). The changes to the Deposit Account Agreement will be effective as of November 1, 2017. Please carefully review the contents of this letter and retain a copy for your records. Changes to our Deposit Account Agreements include: Section 6 Account Ownership Products Impacted: Money Market, Checking, Certificate of Deposit, and Savings Accounts To name a beneficiary on an Account, we may require you to provide certain personal identifying information (for example, a Social Security Number and date of birth) of your beneficiary. Section 9 Checks Products Impacted: Savings Accounts Checks may NOT be drawn against Savings Accounts. Section 11 (b) Posting Order for Money Market, Savings and Personal Checking Accounts Products Impacted: Money Market, Checking, and Savings Accounts Internal transfers scheduled for the same day will be posted throughout the day as they occur. Effective December 9, 2017, internal transfers scheduled for the next Business Day or later will be posted at the beginning of the scheduled transfer date. Section 14(a) Internal Transfers Between Discover Accounts Products Impacted: Money Market, Checking, and Savings Accounts Internal transfers scheduled for the same day are processed immediately. Effective December 9, 2017, internal transfers scheduled for the next business day or later are processed at the beginning of the scheduled transfer date. Section 15 Funds Availability (Holds) Products Impacted: Money Market, Checking, and Savings Accounts Section (a)(i) General Availability Special Check Types (U.S. postal money orders, Federal Reserve Bank, Federal Home Loan Bank, cashier’s, official, certified, teller, state and local government and travelers checks) made in person to one of our employees at the Branch will be made available no later than the first Business Day after the date of deposit. For Special Check Types (U.S. postal money orders, Federal Reserve Bank, Federal Home Loan Bank, cashier’s, official, certified, teller, and state and local government) not made in person to one of our employees at the Branch, the first $200 of your deposit will be made available no later than the first Business Day after the date of deposit, and the… Read more »
Matt
Matt

Crazy DP… can’t be true but thought I’d share anyway. Customer rep told me today that (a) the 1% will begin sometime in November or December, (b) it will have no cap, and (c) it will apply to bill pays as well….. has to be too good to be true right?

JJ
JJ

I got this from my cash back checking account.

Coming Soon!

Earn 1% cash back on up to $3,000 in debit card purchases each month *

Discover Bank Debit Card
Great news! We’re replacing the current Cashback Checking rewards structure with 1% cash back on up to $3,000 in debit card purchases each month. *

This simplified rewards structure joins all the great features you currently enjoy, including:
•No minimum balances or monthly fees
•Access to more than 60,000 no-fee ATMs
•24/7 U.S.-based customer service

jack
jack

I don’t think it will work out for purchase MO in walmart.
There is a language right there.
* ATM transactions, the purchase of money orders or cash-equivalents, cash over portions of point-of-sale transactions, and Peer-to-Peer (P2P) payments are not eligible for cashback rewards. Purchases made using third-party payment accounts (services such as Venmo® and PayPal™) may not be eligible for cashback rewards.

Any suggestions beside purchase MO ?
Thanks

JASON
JASON

The only way to try it out could be that use it on some P2P instant cash sending apps and hope one could work. I’ve been paying my cable bill at $1.00 per day, split it out for 30 days a month even their terms say that the kind of activity is not considered a regular bill pay activity and may not be eligible for cash back $0.10 per transaction. But this is never enforced and I’ve been receiving cash back that way for months. 100 transactions are needed to max out for the $10 per month so I’ve done that on my utility bill as well. Cable+Water+ConEd+gas=4*30=120 transactions already. So, I’m thinking even the terms said no P2P but we really need to create DP ourselves to test it. That should be fun.

JASON
JASON

Just realized weekends and holiday do not count as they don’t allow to schedule payment on those days so I added payment to my credit card as well to max out the 100 bill pay transactions per month.

Ryan Goldstein

I see that too. In addition to the new $3,000 limit, there are also new terms plus updated fine print compared to the previous screenshot I shared in an earlier comment.

Previous promo: https://i.imgur.com/nVnpUIz.png

Current promo: https://i.imgur.com/FHpOiUM.png

The addition to the fine print specifies the purchase of money orders or cash-equivalents as ineligible for rewards.

Previous fine print:* ATM Transactions, cash over portions of point-of-sale transactions, and Peer-to-Peer (P2P) payments are not eligible for rewards. Purchases made using third-party payment accounts (services such as Venmo® and PayPal™) may not be eligible for rewards.

Current fine print: * ATM transactions, the purchase of money orders or cash-equivalents, cash over portions of point-of-sale transactions, and Peer-to-Peer (P2P) payments are not eligible for cashback rewards. Purchases made using third-party payment accounts (services such as Venmo® and PayPal™) may not be eligible for cashback rewards.

Eduardo Baez
Eduardo Baez

Got same notification today.
Called CSR. She told me changes will be implemented on December 1st, 2017. The 1% is only for debit card purchases up to $3,000. So, bill payments and checks transactions will not count anymore.
I will be closing my Discover Cash Back Checking account after November 2017 cash back posts.

Ender
Ender

I see the terms excludes MOs, wondering if reloading bluebird etc would work.

jack
jack

bluebird still works out??…I thought it’s die bird.

Ender
Ender

I do still have active bluebirds/serve, just rarely use them.

JASON
JASON

You might want to get a paypal business debit card and load your blue bird and serve with that. Max you can load per account is $1000 that gives you $10 as cash back. It’s much better than the current discover debit card rewards since most wouldn’t be able to max out the $10 from discover. But it’s much easier to max out on blue bird/serve paired with PPBDC

Ender
Ender

Thanks for the idea. I have heard about the PPBDC trick, just don’t wanna to mess with Paypal, sounds too much hassle and risk.

JASON
JASON

BlueBird/Serve loading only accepts master and visa debit card.

Ender
Ender

Oh, OK. I guess I don’t even need to try. Thanks for the heads up

Matt
Matt

What credit card companies allow you to pay bills with a debit card? Would basically add 1% rewards to every credit card in the company’s portfolio…

Miz
Miz

None of those few banks that accept debit for credit card payments, do not accept Discover debit, only Visa and Mastercard.

Jack
Jack

They won’t be able to tell that my Walmart purchases will be for money orders, they can take their terms and suck them. If they want to close my account, let them, because Discover is useless other than for stuff like this. And if Discover wants to shut me down for abusing this then they are doing me a favor because this is the only valuable product that they have.

Vijay
Vijay

Discover is going to loose lot of money (which we used to stack up in checking accounts for bill pays and check writing) and its going to be a massive shutdown of accounts which they will experience and I’ll be the one of the many to close the checking account with them.

Jack
Jack

If they close accounts for abusing this promotion I will by happy because it will reduce the number of accounts I have to keep track of and I won’t need to take a few minutes of my valuable time to close the account myself. This account has been a useless thorn in my side since the $300 bonus a couple years ago. Only reason I have not closed it yet is because it has no monthly service fee.

Paul
Paul

For certain low priced grocery stores in the NW like Winco that only allow debit cards, this could be kind of nice to get money back for.

Stephen M
Stephen M

You aren’t going to get cashback if you use debit (PIN) instead of credit (signature)

sloebrake
sloebrake

Student loans. Useful if you don’t already have a rewards debit.

Peter
Peter

Lame change. Would rather have the $0.10 program currently. I don’t max it out but at least I get a better return for what I do already. Only time I use Discover Debit is for <$5 transactions.

TomJ
TomJ

Put me in the category of wanting to close my Discover account. I don’t see the benefit of keeping it now.

Stephen M
Stephen M

That’s how I’m feeling too, although I’m going to leave them open, but empty just in case they ever institute a decent rewards structure again.

reader1234
reader1234

Does anyone know if the 1% cashback on debit purchases will work on Federal estimated tax and/or State estimated tax paid? Is that considered cash equivalent?

JASON
JASON

I don’t think so. Cash equivalent is usually like buying money order/gift cards.

Steve M
Steve M

I am still really upset about Discover switching to 1% cashback (I get 2% from my wife’s Discover Credit Card because it’s the first year & 4% in select categories). This was a great way to make ends meet (my wife and I are both on disability). I also manage several family members’ finances and I’ve moved all of their money (~$100k) out of Discover because of this change. I told them that and they still wouldn’t even forward my complaint up the ladder.

This 1% was originally supposed to be unlimited, but they’ve now capped it at $30/month.

My wife and I both have Pay*al Business Debit Cards with 1% cashback and a limit of $3k/day (although I would not do $3k per day due to fraud prevention). Unlike Discover, PayPal counts Google Wallet transactions towards cashback.

I use another Pay*al account for send myself an instant (ACH eCheck) payment of $500. Then, I use Google Wallet to send myself (using 2 Google accounts) $500 from my PayPal debit card to my Ally debit card that doesn’t have cashback (don’t do it every day because if a human ever notices this practice, I’m sure they ban it).

PayPal has been known to lock funds, so be careful about overdoing this or you may not see your money for six months.

Also, don’t send Google Wallet funds to any debit card account that does pay cashback or they’ll count it as a return and charge you (my credit union that gives $0.05 per transaction charged me 5 cents for each transaction). Google will also let you deposit the funds back to your account using ACH, but it isn’t as fast as using a VISA or MasterCard debit card

Ally –> PayPal via ACH eCheck
PayPal –> Ally via debit cards (via Google Wallet).

I hope this helps a few people.

Dylan
Dylan

There are some Credit card companies out there (on this reddit thread)

https://www.reddit.com/r/churning/comments/3ogsaj/banks_that_will_let_you_pay_your_cc_bill_with_a/

That allow you to pay a credit card bill with a debit card. I wonder if the paypal card could be used for that?

Dylan
Dylan

UPDATE:

I used a money transmitter app called square cash and that codes as a standard purchase (similar to paypal and venmo). As long as square cash continues to code as a purchase, you might even be able to do the whole “move money from one account to the other” with the new cash back discover card.

Basically I did:

Connect Discover debit card to square cash account 1

Send an amount of money to square cash account 2

Send money right back to bank account (you could also use your bank debit card).

In the square cash app, you could also send the money right to a debit card, but doing so incurs a 1 cent fee. I was just sending a dollar just to test it out, so I opted to wait a couple of days to get my dollar back in my bank account.

Creighton
Creighton

I am really excited about the change frankly & don’t get all the complaints. See my long post. But I do wish that google wallet also would recognize discover as an actual debit card too like they do Visa & Mastercard. I have to use my Discover routing and account number if I want the money sent to my discover checking. It’s only a day delay but it would be instant if they recognized discover as a debit card. A few places don’t for loading funds.

Abe
Abe

Awesome PPBDMC and G Wallet tip. Thanks Stephen M. I’ll be sure to implement that to my current MS and see how it goes.

Steve M
Steve M

Since Discover is discontinuing the 10-10-10, does anyone think they will start paying interest on the checking?

Ferris
Ferris

No, they are transferring the rewards to 1% cashback. If you want interest on your money, put it in a Savings account or invest it.

Stephen M
Stephen M

I do keep most of my money in savings and investments, but most banks do give you some amount of interest on the money sitting in checking. It was one thing when you got something special for using Discover checking, but there really isn’t anything great about these accounts anymore.

Just because they offer cash back rewards doesn’t mean they can’t pay interest too. I have other accounts that offer both. They aren’t mutually exclusive.

Rob
Rob

I’m confused why everyone is so upset. Who uses their debit card for transactions anyway? And doesn’t this essentially turn the Citi Doublecash card into a 3% cashback card for all spend?

TomJ
TomJ

From what I have read in the comments, it doesn’t sound like you will be able to pay Citi with the Discover debit.

Creighton
Creighton

Lol that is a really silly statement, who uses their debit card for transactions, Um millions of people! & I am really happy with this new change bring on the 1 percent.

Vijay
Vijay

This morning, I got a email communication stating Discover bank has sent me an email which was available in Discover Inbox. After checking, looks like they’ve confirmed that the $.10c cashback is ending by 11/31/17. Time to shut the door after the November cash back bonus posts.

TomJ
TomJ

I assume that you mean 11/30/17 since there are only 30 days in November? I have yet to see any confirmation of that date. Anyone have the latest???

Vijay
Vijay

Yep. BTW, all of a sudden I lost access to schedule ‘Bill Payments’ when I checked now. does anyone facing the same issue? Did they blocked bill payments all-together?

TomJ
TomJ

I just checked and have same problem.

arch
arch

(b) The following terms apply to Checking Cashback Bonus rewards earned on December 1, 2017 or after:
You may earn Checking Cashback Bonus Rewards based on qualifying debit card purchases made using your Discover Cashback Checking Account debit card. You will earn Checking Cashback Bonus rewards of 1% of the qualifying debit card purchases on up to $3,000 in purchases per calendar month.
Qualifying debit card purchases include
(i) Point-of-sale purchases made with your debit card, excluding any cash over portion of the purchase and
(ii) Online purchases made with your debit card, except bill payment or funding, depositing or payment of any prepaid card or account or a deposit account.

In addition, debit card purchases that are not eligible for 1% Checking Cashback Bonus rewards include:
(i) Any transaction conducted at an ATM,
(ii) The purchase of money orders or other cash-equivalents,* and
(iii) Peer-to-Peer (P2P) payments.**

In addition to the three exclusions above, purchases made using third-party payment accounts (services such as Venmo® or PayPal™ who also provide P2P payments) may not be eligible for cashback rewards.

*Cash-equivalents include, but are not limited to: currency, coins, negotiable items not yet deposited, U.S. treasury bills and commercial paper.
**P2P payments are defined as electronic money transfers made from one individual’s bank account or credit card to another individual’s bank account or credit card through a P2P payment application.

We reserve the right to request receipts of your debit card purchases within sixty (60) days of the purchase date and you agree to provide such receipts upon request. Failure to provide requested receipts will result in those debit card purchases not being eligible for Cashback Bonus rewards.

Checking Cashback Bonus rewards will be earned monthly and posted to your Checking Cashback Bonus account on the Business Day following your statement end date. Your Checking Account must be open when Bonus rewards are posted.

Rick
Rick

Does anyone know whether paying your taxes through a service like pay1040.com would be considered an online “bill payment” pursuant to section (b)(ii) as listed above by Arch and therefore not eligible for the 1% cashback reward.

Creighton
Creighton

I am surprised by all the people complaining about the change to 1 percent instead of the .10 cents. I was so happy when I saw this change as for folks like me who will now especially use this as their primary checking for almost literally all spending done on my debit card, I will earn way more then it was with the ten cents. This is really the best checking going now with this change! especially since as mentioned in the article there are hardly any good debit rewards programs anymore. The only thing I do wish is that discover would still be recognized more places as an actual debit card. Prime example right now Amazon does not recognize it as such for loading to your gift balance under their 2 percent back program, Only mastercard/visa linked checking’s can get that through them. But anyway ya under the new 1 percent change instead of just the 3-4.00 range I have been earning. I should now get closer to like ten dollars maybe more monthly! & this is a welcome change!

M. Smith
M. Smith

Most people on a board like this don’t use a debit card for everyday spending– they use a credit card with much better rewards. I used to use my Citi Double Cash card for 2% back on everything. Now, I use my Alliant 3% (for the first year, no annual fee first year) for everything. 1% is nothing. I have only used my Discover debit for tiny purchases where the 10¢ is more than the 2-3% I’d get with a credit card. Today is the last day I’ll be using it.

JT
JT

Did Alliant verify your income when applying for the 3% card? I heard minimum income for approval is $100,000 and I don’t really make that much. Still want the card though.

M. Smith
M. Smith

Nope. Applied in the low $80k’s.

dan
dan

just heard news that the roll-out is delayed, does that mean the existing account will keep the 10c per bill pay for dec? and can you explain how does calling citi would help you earn 1% under the new program? don’t think banks take debit card as a valid re-payment source, only bank account?

Creighton
Creighton

I hear ya. Its a mixed bag though as even with credit card rewards, not everyone either has those great cards and lives off of them and! pays them off with no interest! So for folks like me who use their direct deposit and checking debit card linked to it mainly, the 1 percent back is fantastic. Heck I will now get about $1.75 alone back just from paying my auto insurance with it vs what now seems like the measly .10 cents. The Paypal 1 percent debit card is good too but has some things I did not care for.

Jay R
Jay R

Most payers that accept Debit cards only accept Visa/Mastercard debit cards. So having a Discover Debit card will most likely not be helpful for any form of MS.

Creighton
Creighton

Ya that is true indeed for loading purposes discover has a ways to go, even Amazon doesn’t recognize it as a linked “debit” card to your checking for their rewards gift balance program, But for my purchases & some bills I can pay with it, I welcome this 1 percent cashback change gladly!

Dan
Dan

Anyone know of any comparable cards to the old rewards structure (i.e. small purchases, rewards for online bill pay)? I googldaround but no luck. TIA.

Lrdx
Lrdx
Dan
Dan

Sorry. Long thread. Didn’t see. Thanks +1

Dan
Dan

Has there been anything said or any sentiments regarding whether a signup bonus will be offered again for Discover checking? It looks like one hasn’t been offered since fall 2015. So trying to decide if it’d be worth holding out hope for a bonus (seems unlikely) or if its just best to sign up now and try to take advantage of the $30/month. Anybody else in similar predicament?

B.C
B.C

Citi takes payment via debit card. I am going to test it today. I don’t like calling in my payment but I will do it for 1%. Hopefully this works.

TomJ
TomJ

I just read on another site someone said that he tried to pay Citi with Discover but it didn’t work. Anyone have success?

Dan
Dan

I can confirm this happened to me too. Came up as an invalid card. The discover debit card is still a Discover network card (as opposed to Visa or Mastercard). Likely the issue is Citi’s payment processing does not accept Discover. A shame

Ben
Ben

I just called and was told Dec. 13th for Cashback Checking. Hmm…

dan
dan

what happened? the roll-outwas dlayed to dec 13? would existing account convert to the new program on 12/13 then?

dan
dan

does anyone definitely know that the $0.1 reward on billpay for existing account would go away on 12/1 or is it being delayed? help

arch
arch

I got the same “invalid card” response when trying to pay Citicard today. Apparently they are hard wired to refuse Discover debit, although nobody could confirm this. I asked for a note on my account to investigate if this could be fixed for future transactions. And of course I am holding my breath for the correction. Sure put a major dent in my reward plans.

Bman3020
Bman3020

It is the 6011 number on the card. Discover is using the same number as their regular credit card. I tried paying Citi as well. Got the same feedback you described. Talked to supervisor and this is all we could come up with.

arch
arch

Makes sense now as I also had a CSR who checked w/super who said it shows as credit. I can’t believe that this is on Discover though, given Shitibank’s record. Can you imagine that Discover would make such a colossal error that would require every card to be re-numbered? And obviously it is not an issue with other companies. Gotta believe that this is on Citi which leaves little hope that it will be corrected. I will call Discover again and tell them, maybe if enough people call them they can help Citi straighten it out

RMKE
RMKE

Any update on this?

Robert Kacher
Robert Kacher

The product is now live today. I was able to open an account digitally and fund via another checking product. It appears they also removed the requirement indicating the checking account was only available to customers with another discover product. There is a limit of one account per customer.

David Davidson
David Davidson

Bye bye Discover bill pay. Loved using you for all my CC bills every single month (10+ usually). Now I’ll just pay everything directly since there is no incentive to use it. I’m really disappointed with this move.

Superchurn
Superchurn

Any DP on if they use Chex?

Peter
Peter

They pulled Chex when I opened a few years ago.

Gadget
Gadget

Yes, they pull Chex. And, once you have an account, they are sensitive to failed ACH trial deposits… so use only accounts you know for sure are ready to receive ACH and accept ACH pulls. When the micro-deposits fail, it sends a fraud alert and then they shut down your accounts. I hate Discover – I documented my experience under the “hub account” thread if you care to read. But anyway, enjoy.

reader1234
reader1234

I’m thinking about applying for this to pay my state taxes of about $3000 next month using the debit purchase to take advantage of the 1% kickback, what do you guys think? Also, if I applied this week,
how long would it take for them to send out a debit card? Does it matter for the 1% kickback if the taxes paid required a pin or not?

larry
larry

So what is the best way to take advantage of the $30/mo offer? tia

Brandon
Brandon

I’d like to know the answer to this as well.

Andrew
Andrew

Not seeing any simple route. reader1234 probably has the best idea. Assuming you have some big spend that is limited to debit. Alternatively, I’m guess you could overpay your insurance and request a refund check. (this can be a pain in my experience especially if you have a billing dispute and they refuse to refund the balance!) or just buy money orders and hope they are lax.

Sarah
Sarah

um…. If you were going to overpay your insurance why not just do it with a credit card and earn the extra 1.5%?

Peter
Peter

What about Bill Pay at Walmart? If so, I can possibly pay my mortgage each month.

Mimi
Mimi

I have read DP that Discover debit does not work to buy MO at WM so it may be safe to assume that it’ll also be rejected for BPs. IF, you try it and succeed, please let us know.

I’ve tried to use it to pay Citi CC…no go : (

Peter
Peter

Thanks for the reply! That’s super unfortunate 🙁

John K
John K

ARGH! Official Payments (at least in St. Louis County) doesn’t take Discover Debit as a $3.95 flat rate fee for payment of property taxes. Only Visa Debit gets that low fixed rate. All credit cards and MasterCard debit is a fee of ~2.4%.

Steve
Steve

I already have a Discover checking account that I opened a year ago. Would it convert to this automatically?

Papas
Papas

Paying property taxes in California worked for me (already posted and available).
$30 – $3.50 = $26.50 X 2 (two accounts) = $53 net for me.

Bowen
Bowen

I tested today, Plastiq cannot recognize this as a “debit”, and I need to pay 2.5% fee. Also, Radpad has the same problem. Anyone know how to use this 1% cashback? Except for the problem, I love the electroplating blue color.

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