FlyerTalk Forums - View Single Post - Buy with Credit Card, Return & Get Cash?
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Old Sep 20, 2005, 5:50 pm
  #12  
cepheid
 
Join Date: Feb 2005
Location: Boulder, CO
Programs: UA, AA, WN; HH, MR, IHG
Posts: 7,054
Originally Posted by seoulmanjr
I think the real question here is the risk worth the reward.. Say you could flip 1000 miles a montht his way - big whoop if it has an impact on your credit down the road.
This can't have any impact on your credit as long as you are paying off the credit card in a timely fashion. The card company doesn't really care whether you're returning your items or not; they only care if they get paid on time. Of course, in this case you're actually circumventing their cash advance rules, but the card company really has no way of knowing whether or not you returned the items. Your credit score is safe, although the particular store will probably not like this practice if it's being done intentionally.

Originally Posted by SirFlysALot
A store will not do this because they pay a fee to the CC company for each transaction. If they gave you cash they would lose this fee. The best you could do is store credit.
Most CC companies charge not only a percentage off each sale, but also a flat "per transaction" fee. Thus, stores actually have to pay this fee even for returns, although they get back the percentage portion. Depending on the value of your purchase/return, the store may actually save money by paying you cash rather than refunding your card. This is why certain large retailers like Costco or PetSmart will pay cash for small returns (typically under $10), while refunding your card for larger purchases.

The main reason stores prefer to refund your card rather than pay cash is for liability protection for the store and the consumer. It protects the store from scammers who would use a bogus card to make a purchase, and then attempt to get cash from the bogus transaction... and protects the consumer from thieves who steal your card and/or your purchase (assuming they also stole the receipt, e.g. if they stole the whole bag with the receipt in it) and attempt to return it for cash. It also protects them from consumers who would get the cash refund and then contest the charge with their card company, though this is much less likely.

The only stores I've found that pay cash for returns are Costco and PetSmart, as mentioned above, and in those cases ONLY for really small purchases; both stores always ask for the original card for larger returns. (I should not that I've never deliberately tried to get cash back, it's simply that the clerks just handed me cash on those occasions.) You'll find that the easiest way to get more miles and/or more cash back is to take advantage of bonus offers... it will be nearly impossible to find a retailer who will pay cash back on large card purchases, and doing this with smaller purchases isn't worth it JUST for the extra 10 miles you might get.
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