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Penfed Visa w/ 5% Cashback on Gas
Old 12-16-2021, 05:53 PM   #1
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Penfed Visa w/ 5% Cashback on Gas

How do they do this??

I’ve had this card for many many years. It pays 5% cash reward on gas in the form of a statement credit every month. Some other store cards offer 5% (Target, Lowe’s) but they are obviously cutting into their margin to do this. Penfed is somehow taking this out of the merchant fees? I’m not even sure they still offer this card. They tried to get me to switch to a different reward format a few years ago but I declined. I only use this card for gas. Just curious how they are doing this.
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Old 12-16-2021, 05:58 PM   #2
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Quote:
Originally Posted by jazz4cash View Post
They tried to get me to switch to a different reward format a few years ago but I declined. I only use this card for gas. Just curious how they are doing this.
Yes, they tried very hard, and then kind of gave up. My impression was that they got enough people to switch that they could eat the remainder. There are still some of us here who hung onto it, and most of us do as you do, use it just for gas. Hard to beat.
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Old 12-16-2021, 06:53 PM   #3
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Often the higher rewards cards change the merchant more for the transaction.
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Old 12-16-2021, 07:15 PM   #4
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I think they just eat it or hope to make it up on the fees they make when you use it for other things. I only use it for gas.
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Old 12-16-2021, 11:33 PM   #5
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How do they do it? Volume.

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Old 12-17-2021, 10:53 AM   #6
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Because for every user that pays the bill off in full each month, there is another user that doesn't and gets charged 20% per year in interest and the occasional time skips a payment and gets charged $35 late payment.

The balance carrying person, is attracted to the card for the same 5% reason, "I'm saving 5% on my gas, and only carrying a balance of $1,500"
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Old 12-17-2021, 01:41 PM   #7
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Sheesh. You guys are making me feel like a deadbeat…. Oh, wait…..
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