They promise to give you cash for free, but more than a third of cashback websites fail to stump up the money you are due - Cashback websites are hugely popular with penny-pinching, savvy consumers (there's an estimated 2.3 million). The sites list product providers and retailers that pay commission when shoppers click on their links. In turn, the cashback website rebates some of this commission to the consumer.
With thousands of retailers available it is easy to make money on the purchases you would normally do each year, such as annual insurance policies and utilities.
For instance, on Quidco.com, you can earn £55 when you take out car insurance from the RAC or earn £105 if you sign up for dual fuel with Scottish Power. While with Topcashback.co.uk, you could earn £150 if you sign up for a pay monthly mobile phone contract with Orange or £90 if you sign up for Sky HD.
It seems like a win-win, yet according to research by Consumer Intelligence, many cashback websites don't pay up as promised.
James Daley, editor of Which? Money, warned customers to beware of the potential pitfalls of the sites. He said that the cashback sites can only pay you if they get the money from the retailers or product providers, so if something goes wrong (such as if an affiliate goes bust) it is possible you may not be paid.
Cashback sites are not regulated, so in the event of a company collapse, the chances of you getting any money would be the same as any other creditor – a wait to see what assets remain before possibly claiming some cash.
Martin Lewis, founder of Moneysavingexpert.com, said cashback should be seen as a bonus, rather than a reason for buying a product.
"Never count the cash as yours until it's in your bank account as things can and do go wrong. I always say, do not let the cashback tail wag the dog, as you need to think about cashback as an extra bonus as you really have no rights as a consumer," he said. "Use one of the bigger cashback websites as they are more likely to pay out the money."
It can take up to 12 weeks for any cash due to reach your account. However, with most sites you can choose how often to be paid, for example every month, or when you hit certain amounts, such as every time you hit £50 in your account.
It is always important to check a site's payment policy as some will only pay out once you hit a certain threshold of say £25, meaning getting paid out can be very difficult. To avoid this, it is worth sticking with the bigger websites that will pay out at any level.
If you do run into problems, these can be rectified. Mr Daley said: "If you fail to receive money owed, write to the site as quickly as possible via the site's official cashback claim link."
Understanding how cashback websites work increases the likelihood of transactions going smoothly. And to use them is relatively simple – register with the site and then every time you buy online, visit the retailer via your chosen cashback operator, rather than directly.
When you complete your purchase, the online retailer sends a commission to your cashback site, which in turn will be passed on to you. Most sites are free but some charge an annual fee of £5. ( telegraph.co.uk )
With thousands of retailers available it is easy to make money on the purchases you would normally do each year, such as annual insurance policies and utilities.
For instance, on Quidco.com, you can earn £55 when you take out car insurance from the RAC or earn £105 if you sign up for dual fuel with Scottish Power. While with Topcashback.co.uk, you could earn £150 if you sign up for a pay monthly mobile phone contract with Orange or £90 if you sign up for Sky HD.
It seems like a win-win, yet according to research by Consumer Intelligence, many cashback websites don't pay up as promised.
James Daley, editor of Which? Money, warned customers to beware of the potential pitfalls of the sites. He said that the cashback sites can only pay you if they get the money from the retailers or product providers, so if something goes wrong (such as if an affiliate goes bust) it is possible you may not be paid.
Cashback sites are not regulated, so in the event of a company collapse, the chances of you getting any money would be the same as any other creditor – a wait to see what assets remain before possibly claiming some cash.
Martin Lewis, founder of Moneysavingexpert.com, said cashback should be seen as a bonus, rather than a reason for buying a product.
"Never count the cash as yours until it's in your bank account as things can and do go wrong. I always say, do not let the cashback tail wag the dog, as you need to think about cashback as an extra bonus as you really have no rights as a consumer," he said. "Use one of the bigger cashback websites as they are more likely to pay out the money."
It can take up to 12 weeks for any cash due to reach your account. However, with most sites you can choose how often to be paid, for example every month, or when you hit certain amounts, such as every time you hit £50 in your account.
It is always important to check a site's payment policy as some will only pay out once you hit a certain threshold of say £25, meaning getting paid out can be very difficult. To avoid this, it is worth sticking with the bigger websites that will pay out at any level.
If you do run into problems, these can be rectified. Mr Daley said: "If you fail to receive money owed, write to the site as quickly as possible via the site's official cashback claim link."
Understanding how cashback websites work increases the likelihood of transactions going smoothly. And to use them is relatively simple – register with the site and then every time you buy online, visit the retailer via your chosen cashback operator, rather than directly.
When you complete your purchase, the online retailer sends a commission to your cashback site, which in turn will be passed on to you. Most sites are free but some charge an annual fee of £5. ( telegraph.co.uk )
1 comment:
However, this is not true for renowned cash back sites like FatWallet, AAfter Search, ShopAtHome and Ebates.
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