Originally Posted by
MDtR-Chicago
From the best information everyone has in this community, CVS is the one who loses out. The $503.95 purchase costs them in the neighborhood of $10 in credit card fees.
One thing none of us really knows is what other compensation CVS might receive from the vendors involved and/or if it's all worthwhile as a loss leader.
The question wasn't about who loses money on VR in general, the question was about who loses money on VR when someone uses it to "cycle" money vs. pay "legitimate" expenses. Setho212 indicated that
cycling money causes one of the companies to lose money. My point is that the transactions have the same result regardless of how you dispose of the money.
I am also skeptical that CVS loses money. VRs just don't strike me as a very good loss leader. I wouldn't be surprised if the relationship between CVS and the gift card companies was more like a landlord-tenant relationship, with CVS essentially renting out store space for the displays.