Saturday, October 22, 2011

Discover Cash Over

One of the great (and I think often unappreciated or misunderstood or even feared) benefits of the Discover Card is the Discover Cash Over benefit (not to be confused with Discover Card's much better known Cashback Bonus benefit). As the web page focused on this benefit currently states, a card holder can "get cash over your purchases and save time and money." The page adds, "Take care of two errands at once. And pay no fee."

I find this benefit better than using an ATM. There are no fees and it can be used while shopping at one of numerous participating stores. The page advertises these benefits: "Avoid fees - No transaction fee. No ATM fee. No bank fee." The page also points out that the "cash over" counts as a normal purchase. Thus, if you request $20 cash over (amounts available are typically in $20 increments), it is as if you purchased an additional item at that store for $20.

Not every merchant that accepts Discover Card as payment participates in the Cash Over benefit. The list of participating merchants is available on the benefit's page. At the time of this writing, these participating merchants include Kroger (King Soopers and City Market in Colorado) and Wal-Mart.

There are no fees associated with this benefit, but it is important to keep in mind that carrying a balance (not paying it off each month) means paying interest on the cash over just as interest is paid on the purchase price of goods and services. If you do pay off your Discover Card balance each month, this service is totally free!

This is a very convenient benefit of the Discover Card. It is handy to be able to make purchases and access cash in a single stop without paying any banking fees. It is actually easier than using an ATM machine if you're going to purchase items at one of the participating merchants anyway. With some big banks starting to increase fees for debit card use, this benefit might look even more attractive.

1 comment:

  1. Well, I guess we differ on the meaning of "no cost". I make hundreds of transactions per year where I have to either answer verbally (Giant Food) or electronically (Safeway self-serve checkout) that I do not want cash back. The benefit of cash-over could easily be delivered WITHOUT THE NEED TO DECLINE IT ON EVERY PURCHASE. If it were truly an opt-in benefit, I would be right there with you that it's truly a great benefit (although not one that I use). So, why do they explicitly make you opt-out? There is a percentage of card-holders who will opt for the dangling carrot and take the fee-free cash, and end up paying interest on it in addition to their regular purchases. Deceptive or brilliant marketing, you be the judge. It's like marketing gambling to some (not all) that can leats afford it. Say, 80% of discover card holders don't mind having to decline it, use it properly, see it as a benefit, is convenient and saves time 5% are like me and grumble because I have to explicitly opt-out hundreds of times per year, and there's no way to turn it off. Then, the remaining 15% are people who carry a balance, and also "take advantage" of this benefit - Now, the interest they pay each month spirals, profit goes up for Discover.