Amex cash back at a grocery store

Question

When I go to the grocery store I have the opportunity to get cash back (groceries cost $23, I opt for $20 cash back, and my card gets charged $43 instead of $23 leaving me with $20 cash in-hand).

My question is this: Does AMEX see the cash-back portion of this transaction as a cash advance or do they simply regard the $20 as money spent at a grocery store?

I'm considering getting an Amex so I don't have a statement yet. — rein, Aug 24 '17 at 18:43
It is a cash advance - if it is even allowed. Normally only debit cards support cash-back. — Aganju, Aug 24 '17 at 18:47
Just an FYI, Amex charge cards do not offer cash back - only points. — Michael, Aug 24 '17 at 19:39
@MichaelC. Yes but points can be redeemed for statement credit, which is almost as good. — Nosrac, Aug 24 '17 at 20:07
It would be a cash advance, as @Aganju pointed out. Careful, it's not "free money", it carries very steep interest rates usually... like 20%+, way more than your normal APR for the card. — SnakeDoc, Aug 24 '17 at 20:48
Also the limit for cash advances are lower than your actual credit limit. — Michael, Aug 24 '17 at 20:54
@SnakeDoc (and Aganju), this is not necessarily correct (see my answer). (Though being careful = always good.) — Joe, Aug 24 '17 at 21:27
Which AmEx card are you considering and which country are you in? AmEx has lots of different cards, some of which operate completely differently from others (i.e. some are charge cards, others are credit cards.) The terms and benefits also vary by country of issue. — reirab, Aug 24 '17 at 21:48
@reirab They do not offer cash back charge cards. Which are different than credit cards. — Michael, Aug 24 '17 at 21:59
@MichaelC. A bit irrelevant? OP is not talking about "cashback" in rewards, but getting cash at register. — xiaomy, Aug 24 '17 at 22:01
It seems this question is hypothetical and there is no way of knowing the answer since Amex doesn't have this feature (yet). — xiaomy, Aug 24 '17 at 22:05
You should ask AMEX. They should be willing to tell you the terms of the card you are thinking about. Instead of asking whether it is part of the purchase ask whether there are fees and interest associated. — Ross Millikan, Aug 25 '17 at 00:20
Related question about cash back with credit cards: https://money.stackexchange.com/questions/35631/why-do-grocery-stores-in-the-u-s-offer-cash-back-so-eagerly — Philip, Aug 25 '17 at 13:42

score 38 · Answer 1 · edited Jun 16 '20 at 10:49

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You will have to read your credit card's terms and conditions to determine exactly how this is handled for your card, but for my Discover this is handled as a purchase (at the Purchase APR), not as an advance.

The benefits description is specific:

Get cash where you shop the most

Get the cash you need without an extra trip to the ATM.

Avoid fees- No transaction fee. No ATM fee. No bank fee.

Your regular purchase APR applies to the cash you get and there are no hidden fees.

They have a long list of stores (mostly grocery stores) that participate. Your credit card will have a similar page and similar list.

edited Jun 16 '20 at 10:49

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answered Aug 24 '17 at 19:14

Joe

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Note that as OP has clarified this is for a card they do not yet have, it's likely that non-Discover cards do not support this benefit (and thus cannot be used in this way); I don't know of any other specific card that does have this benefit (though I have no reason to believe there isn't one). – Joe Aug 24 '17 at 19:15
I've read the terms and conditions on American Express cards and they don't mention getting cash at stores at all. https://www.americanexpress.com/us/credit-cards/personal-card-application/terms/delta-gold-credit-card/25330-10-0/?print – rein Aug 24 '17 at 19:17
@rein Then they likely do not have this feature (i.e., you would not be able to do this). If this feature is interesting/useful to you, Discover is the way to go I guess. – Joe Aug 24 '17 at 19:23
Worth noting, there are limits on the "cash-over" amounts per transaction. I think when I've used my Discover card it has only ever offered up to $40 at grocery checkouts. So enough for a few things, but doesn't replace an ATM withdrawal (which they'll charge the higher interest for) if you're the type that likes to carry lots of cash. Luckily, I'm not that type. I really like this feature on the card and have used it a bunch of times. – CactusCake Aug 24 '17 at 20:06
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@CactusCake The Discover limit is $120 per 24 hour period (on that same page linked), but of course most stores have a lower limit (as they typically do with debit transactions). – Joe Aug 24 '17 at 20:17
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Wow, that sounds absurdly easy to manufactured-spend - are there any Discover cards that allow this and have rewards? :D – neminem Aug 24 '17 at 22:23
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@Joe Do you know whether the stores still pay the 2% or so merchant fees on the cashback? If they do, do they know, as it would be costing them money to provide you money (without making a profit on goods sold). If the stores don't pay, what's in it for Discover? (I doubt they're doing it out of the goodness of their hearts!) – TripeHound Aug 25 '17 at 07:25
@TripeHound I don't think that information is public knowledge, but given that it's a store-enabled feature, I'm sure they have some sort of deal with Discover - perhaps a small decrease in their overall merchant fee, for example, in exchange for participating. – Joe Aug 25 '17 at 14:12
@neminem Yeah, it sounds like you could esseentially earn an extra $1.20 per day in cash back just by structuring transactions you were already going to make. Although, being paid $1.20 per day just to go to the grocery store for stuff I need instead of making, say, one trip per week, along with the hassle of then having to deposit that $120/day to cycle it back into my account makes it seem more trouble than it's worth... – Aug 25 '17 at 21:36
@TripeHound: I doubt they care about losing 2% of $120 that they're not making a profit on, given that they got you in the store to buy something they make at least 100% markup on. – R.. GitHub STOP HELPING ICE Aug 25 '17 at 21:54
On top of that, they actually do profit from getting you to take cash back - they reduce the amount of cash they have to secure at their store and securely transfer to a bank. Handling cash safely is actually considerably more costly than paying credit card fees. – R.. GitHub STOP HELPING ICE Aug 25 '17 at 21:55
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Checked one of my statements where I'd taken cash over on grocery transactions. They do not award cashback rewards on the cash over portion of the transaction. I expected this would be the case. – CactusCake Aug 28 '17 at 14:19

score 26 · Accepted Answer · answered Aug 24 '17 at 18:49

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There may be a confusion here: I don't think you can get cash back at a register with a credit card. See http://www.cardratings.com/can-i-get-cash-back-when-i-buy-something-with-a-credit-card.html

Cash back is only available with a debit card. With a debit card, the money comes directly out of your account at the moment of the transaction. With a credit card, the CC company loans the money to you and you get a monthly bill. You can get cash advances at ATM machines, but typically comes with hefty fees and exorbitant interest rates, so I strongly advice against this.

There are "Cash Back" credit cards, but that means that you get a percentage of your purchases refunded as cash (or points).

answered Aug 24 '17 at 18:49

Hilmar

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Thanks that answers my question. I wasn't sure if the register would see the Amex as a credit card or a "charge card". If it's seen as a credit card then I can understand that there wouldn't be a cash-back option. (I'll mark this as correct as soon as the timer allows). – rein Aug 24 '17 at 18:51
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@rein, the only difference between a credit card and a charge card is that the agreement on the latter assumes payment in full each month. Over the last decade Amex has really watered down the difference and now offers "flexible payment" its charge cards making them effectively no different from credit cards. – quid Aug 24 '17 at 18:53
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This answer is flat-out wrong, unfortunately. Several cards, Discover primarily in my experience, offer a cash back option at the register identical in appearance to cash back from debit cards - except they don't even require a PIN. – Joe Aug 24 '17 at 19:10
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I wouldn't consider the answer to be "flat out wrong" as my question deals specifically with American Express. The only part that may be wrong is the generalization of it being disallowed for all credit cards (seeing as Discover allows it) but it may still hold true for American Express. I'm going to stick with this answer unless someone who has experience with Amex refutes this. – rein Aug 24 '17 at 19:23
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Well, that's why I say 'unfortunately'. The first two declarative statements are simply false. I think that reworded this would be a helpful answer, but as it stands it's misleading. (And of course you're welcome to give the checkmark to whomever you prefer - that's your choice as OP and has nothing to do with any of our opinions. ) – Joe Aug 24 '17 at 19:25
This is very very wrong. My AMEX has cash back turned on. It doesn't by default and I had to meet certain stipulations (I forgot what they were) but basically I got in a situation overseas where my ATM card didn't work - all of a sudden all ATMs started requiring chip and mine didn't have a chip. So called AMEX had to agree to a variety of things and they turned on cash advances. So I can still get like $500 a month. Used it once and it is just for emergencies... but certainly works and I have never had a debit card. – blankip Aug 25 '17 at 17:13
@blankip You are confusing "getting cash at register" with cash advance. – xiaomy Aug 28 '17 at 14:39

score 1 · Answer 3 · answered Aug 24 '17 at 20:51

My visa would put the goods on the current monthly balance which is no-interest, but the cash part becomes part of the immediate interest-bearing sum.

There is no option for getting cash without paying immediate interest, except perhaps for buying something then immediately returning it, but most merchants will do a refund to the card instead of cash in hand.

This is in New Zealand, other regions may have different rules.

Also, if I use the "cheque" or "savings" options at the eftpos machine instead of the "credit" option, then I can have cash immediately, withdrawn from my account, with no interest charge. However the account has to have sufficient balance to do so.

Amex cash back at a grocery store

3 Answers3