Don’t let cashback slip through the net

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Rewards for shopping online do not always add up, so click with care when booking a break.

CONSUMERS are increasingly using cashback websites to “earn” money when shopping online, but can they rely on receiving the rewards that are advertised?

Jonathan Gould, 57, spotted an advert offer for 7.5% cashback on Thomas Cook “package holidays” booked via, one of Britain’s leading cashback sites.

He booked a week in Turkey for himself and wife Susan, 61, which cost £1,700 for flights and accommodation. Gould, an accountant, calculated he would get about £127.50 cashback from Quidco.

To his surprise, he received only £42. He queried this with Quidco and was assured he would get the rest. Gould then spent six months chasing the company. It was only after The Sunday Times intervened that he was paid the full amount.

His experience raises questions about deals advertised on sites such as Quidco and Customers earn cashback if they “click through” to the websites of participating retailers, which include M&S, Tesco, Boots and John Lewis, or providers of services such as energy, mobile phones and insurance. No cashback is paid if shoppers buy the same products or services direct from vendors.

Millions of people visit the sites every month, making them a good source of customers. In March they had 250m visits, compared with 160m in March 2012, according to analysis for The Sunday Times by credit reference agency Experian.

But cashback services are not fully regulated and there is no guarantee that shoppers will receive the amount advertised. Also, the payout time varies widely.

Quidco has about 5m members and 4,200 registered retailers. It said less than 0.5% of sales via its site had “authentication issues”. In December, it received a record 1m purchases. This suggests 5,000 payment disputes a month.

Gould, from Godalming, Surrey, has been a Quidco member for three years and says he has earned more than £600 from buying energy, insurance, holidays and Charles Tyrwhitt shirts via the site.

He said: “Though I still would have gone to Turkey, I might not have gone with the Thomas Cook deal had I known the actual amount I would get in cashback.”

James Daley, who runs the consumer site, said: “Cashback and loyalty schemes are changing the way people shop, but there is little protection for those who don’t get what they are promised. This is a grey area for consumer protection rules and needs reform.”

How does cashback work?

Like comparison sites, such as and, cashback sites receive fees from service providers and retailers for referring customers to them.

The cashback sites pay at least some of this fee to the customer as a reward. It is typically paid into a cashback account, from where customers transfer it into their current accounts. However, the sites do not make the payment until they have received their fee from the vendor. This may mean a lengthy wait for customers. Crucially, deals can change at short notice, so the rate advertised may not be what customers end up getting.

Quidco said: “There is no typical time frame, as payouts depend on a wide variety of factors.

“For example, holidays and travel will be paid only on completion of the trip. We provide guidance on payment timings for all merchants [retailers] on Quidco on the respective merchant pages.”

Typically, cashback from M&S is paid in about five weeks, while it is about three weeks for the booking service, according to Quidco.

What happened with the Goulds?

Quidco admitted that it had advertised a 7.5% discount for Thomas Cook “package” holidays on June 19 last year, when Gould booked his trip. However, Thomas Cook said cashback was payable only for “hotels”and not for the whole trip.

“We did amend this rate to reflect the correct offering when the error was discovered,” said Quidco. “On further investigation, it was established that this was an administrative error, and steps have been taken to reconcile this to any members affected. As the error was ours, we paid out the full difference in cashback to all affected users.”

Thomas Cook said: “It is always concerning when any of our customers are disappointed by any service we provide. We continue to advise customers to read the terms and conditions thoroughly before they book with us.”

What can I do if I don’t receive the right payout?

Lodge a complaint with the cashback site. “Where there is an unresolved issue that a customer would like investigated, we have a clear process in place to ensure that their claim is reviewed by the retailer and they get a resolution,” said Quidco.

“Cashback is never guaranteed, as we make clear on the site, but provided the member follows the terms set out on the retailer page, there shouldn’t be a problem claiming the cashback from the retailer.”

The Financial Conduct Authority said cashback sites were regulated and it expected the firms “to meet all our standards”.

It added: “The amount offered and the amount paid by these firms are unregulated activities, so concerns about misleading advertising must be dealt with by the Advertising Standards Authority.”