Cashbacks not always a good deal

Getting a partial refund for big ticket items may sound great, but not everyone is smiling.
 
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02.How it works and traps

The idea is quite simple: A retailer might advertise a computer for $1000, but as an incentive for you to buy it, the manufacturer provides a $100 cashback voucher. In theory, then, the computer is really costing you $900.

However, to get the $100 back, you’ll need to register your claim by returning the completed voucher with additional details to prove where and when you bought the computer. It’s important to read and follow the manufacturer’s terms and conditions; there’ll be a deadline for receipt of the claim information and you may need to include the barcode printed on the cardboard box your computer came in. Then you’ll need to wait before you receive the money, which may be sent as a cheque or paid directly into your bank account.

In many cases, this process works fine. But there are plenty of complaints from consumers to suggest numerous exceptions to the rule have occurred.

The traps

The cashback system is premised on the fact that many people (though only the manufacturer knows how many) will never make a successful claim. Some of the most common reasons include:

  • They forget to return the claim form and other proof of purchase.
  • They lose the necessary documentation.
  • They make a claim that’s deemed invalid – for example, because it’s late or incomplete.
  • They spend so much time and effort chasing their claim that eventually they give up.
  • They make a perfectly valid claim that is rejected by the manufacturer.
  • They get stung by unfair terms and conditions of the cashback schemes.

These are just some of the potential traps. Redemptions can take months to process and involve unnecessary and frustrating delays. There’s also the possibility that the computer or TV was overpriced in the first place, and even taking the cashback into account you still could have got a better deal elsewhere. The model may also be older or inferior, and about to be replaced by a better one.

 

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