Customers of ING Direct were less than happy when the online lender decided to remove its 2% cash back incentive, from 30 September 2016, for contactless purchases under $100 on its Orange Everyday account.
However ING Direct isn’t the first provider to scrap its freebie bank account offer. ME Bank in July 2015 and Citibank more recently in May this year, who were both offering 5% cash back, also removed these “tap and go” incentives from the table.
In Mozo’s bank account database, which compares around 100 bank accounts, there is just one account left that comes with a cash back offer – the Australian Military Bank Military Rewards Account earning you 2% cash back for payWave purchases.
So is this the end of the short lived bank account cashback era? Well, it could be for now, as providers tighten their belts in the face of low interest rates and greater competition in the market.
Of course, while debit card cash back incentives being axed, is disappointing news for customers (I should know, as I loved nothing more than tapping my orange card for free cash), there are still ways consumers can plump up their stash cash. It just takes a little strategising…
1. Stash the majority of your cash in a high interest savings account
Okay interest rates might not be what they used to be but it’s still better having the majority of your cash in a high interest savings account, rather than it sitting in your everyday bank account earning you zip. At the moment the highest rate is 3.40% for the first 4 months offered by Citibank with its Online Saver, which would earn you $85 interest over the intro period with a $10,000 balance.
2. Take advantage of cash back offers on other products
While providers may be ditching cash back offers attached to bank accounts, the same can’t be said for other products like credit cards, as here at Mozo we’ve seen a great number of providers roll out cash back offers over the last month.
Just take the American Express Essential Credit Card for an example, which not only has a $0 annual fee but will give you $50 cash back when you spend over $500 in the first 2 months. Just make sure you pay your balance in full and on time, as a late payment fee and 14.99% interest rate, will quickly outweigh the value of the cash back offer.