Quick background: Discover is currently running two overlapping promotions: an extra 10% cash back for Apple Pay purchases made through December 31st, plus double all cash back for a year. Each promotion is amazing on its own. Taken together, they’re fantastic. You can get 20% back on all Apple Pay purchases, in addition to your usual credit card rewards! But… we don’t yet know if gift card purchases will work… You can find full details here and here.
Do gift cards count?
The terms of Discover’s Apple Pay promotion are very clear: gift card purchases are excluded:
Earn an extra 10% Cashback Bonus on up to $10,000 of in-store purchases when you use your Discover card with Apple Pay now through 12/31/15. Excludes gift card purchases. No sign up needed. Rewards earned are in addition to your standard rewards and are added to your Cashback Bonus account within 2 billing periods.
That said, it is often the case with promotions that gift card purchases are explicitly excluded, but they work anyway. If gift card purchases do work with this promotion, then it would be very easy to rack up $10,000 of spend through Apple Pay (assuming you have stores near you that sell gift cards and let you pay with a credit card via Apple Pay). For those with a well stocked OfficeMax store nearby, it has become even easier now that they carry $500 Visa and MasterCard gift cards.
Waiting and wondering
Many of us have been waiting for definitive proof of whether or not gift card purchases result in 10% cashback (or 10X extra “miles” in the case of miles-earning Discover cards). While it wouldn’t be the end of the world to buy $10,000 worth of gift cards without getting the 10% bonus, it wouldn’t be all that rewarding either. At best, if you paid with the Discover It Miles card, you would get the equivalent of 1.5% back now and another 1.5% at the end of your first 12 months with the card. Since $500 Visa/MasterCard gift card fees are usually about 1%, you would still clear about 2%, or $200. That’s a far cry from the $2,000 (less fees) that you would hope to earn from the combination of the Apple Pay and double first year bonuses.
Unfortunately, even people who have had a second statement close since the beginning of this promotion have not yet earned any extra Apple Pay rewards — Not for gift cards and not for regular purchases.
What Discover Says
The terms of the promotion claim that you will receive rewards “within 2 billing periods”. Well, that hasn’t happened. I called Discover a few times to see what their phone reps had to say. One kept to the “2 billing periods” line. She said that when my second statement closes in early November, I should call them if I don’t see the 10% rewards. A second rep said that rewards are likely to take 60 days from the date of purchase and then should appear on the next statement after that.
A new waiting date
Let’s assume that the second rep I spoke with is correct. The promo began on September 16th. We can count forward 60 days to see the first date that the reward may be applied: November 15th (which also happens to be my son’s 16th birthday!).
If we assume that a lot of people ran out and used Apple Pay on September 16th, then there should be a decent number of people who made purchases and who’s statements will close shortly after November 15th. If we give the system a bit of a buffer, we get to our new waiting date range: Monday November 16th through Friday November 20th.
I expect that readers will chime in around those dates with results from their latest statements. Did they earn 10% back for gift card purchases? Did they earn 10% back for anything? Did gift card purchases work at some stores, but not at others?
Strategy
I plan to keep waiting until November 21st. If we hear from readers before then that gift cards work, then great! I’ll start buying. If we learn that gift cards do not work, then I’ll look to other options:
- I’ll use Discover and Apple Pay for all regular purchases, whenever possible. I expect that I’ll go to stores that support Apple Pay rather than to others if all else is equal. I may stock up on some non perishable items that I know I’ll use in the long term.
- I’ll buy holiday gifts at stores that support Apple Pay.
- I’ll look for buy/sell opportunities. The ideal candidates would be ones where I can earn a small profit, or break even, before considering the 20% rebate from the two Discover promotions.
What if November 20th comes and goes with no new information? Then we’ll all have a tough decision to make. Do we gamble on gift cards or go with plan B? I don’t yet know which way I’ll go, but I’ll let you know what I decide if it comes to that.
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No need to send link. I found out how easy it was to add. Very new to using a smartphone.
Now I have my new Discover miles card AND an iPhone 6S+. My first smart phone. How do I do Apple Pay? Someone please lead me to a good tutorial link.
I don’t think they are able to identify which are GC purchases, or they wouldn’t have the line about needing to submit receipts if you disagree. They are probably speculating based on store and amount.
ok. The cat is out of the bag. I got 4 e mails from discover. They are able to identify GC purchases and have said that I will not get 10 miles for that portion of the purchase.
Here is the excerpt the e mail rom discover
Important info about extra rewards with Apple Pay
Gift card purchases will not earn extra rewards
Dear Narayanan Raghuvaran,
We’re writing to let you know that your Apple Pay purchase on September 20, 2015 for $528.08 at Rite Aid included a gift card. The gift card portion of your purchase does not qualify for the 10 Miles per dollar spent promotion.
As a reminder, now through December 31, 2015, you’ll earn an extra 10 Miles per dollar spent on up to $10,000 in purchases when you shop in stores and use your Discover card with Apple Pay, excluding gift card purchases.
If you disagree with our finding and contend that your purchase did not include a gift card or a portion of your purchase qualifies per the terms of the promotion, let us know with supporting documentation in the next 21 days. Documentation can include store receipts or invoices, but cannot include your Discover card statement. You can send documentation via email:
•Scan and then e-mail to promoverification@discover.com
Sincerely,
Discover Card Customer Service
FYI, just got a handful of emails from Discover:
We’re writing to let you know that your Apple Pay purchase on September **, 2015 for $$$.$$ at Walgreens #1159 included a gift card. The gift card portion of your purchase does not qualify for the 10% Cashback Bonus® promotion.
As a reminder, now through December 31, 2015, you’ll earn an extra 10% Cashback Bonus® on up to $10,000 in purchases when you shop in stores and use your Discover card with Apple Pay, excluding gift card purchases.
If you disagree with our finding and contend that your purchase did not include a gift card or a portion of your purchase qualifies per the terms of the promotion, let us know with supporting documentation in the next 21 days. Documentation can include store receipts or invoices, but cannot include your Discover card statement. You can send documentation via email:
•Scan and then e-mail to promoverification@discover.com
Sincerely,
Discover Card Customer Service
So I know this thread is a month old but I received an e-mail for a big purchase from Staples. I purchased a computer, virus protection and Microsoft Office and they flagged it as a gift card purchase! I stupidly do not have the receipt because it worked just fine. I also did not punch in my Staples Rewards Card Number so the receipt isn’t saved. I e-mailed Discover back and told them and was very disappointed and told them the items I bought (exact ones) and was mad that it was flagged as a gift card purchase when it clearly was not. I’m hoping they e-mail me back soon and say things are resolved. They CLEARLY are just flagging big purchases. I hope they come clean.
That sucks. Come on Discover – what happened to your great customer service?
Adam, if you go back to the store they should be able to find the receipt for you. It’s a huge pain but probably worth the rewards in this case
Yes, things are not resolved yet. They e-mailed me back and said to contact the merchant and get the receipt. Definitely worth it to go get the receipt but just goes to show you they really have no idea what is a gift and what is not. I guess I should go get the receipt for the TV I bought at BJs and FitBit and scale that I bought at Best Buy too since I know that they will flag them.
Data point:
My statement closes on 2nd of the month, so i’ve had 10/2 and 11/2 statements so far, since the start of the ApplePay promotion. Starting with 11/2 statement, the cashback section has a line item for ApplePay under the Discover Deals & Promotional section (10/2 statement didn’t have it). I had one GC-only transaction and several non-GC transactions between start of promo and 10/2. I received 10% CB for all of the non-GC transactions, and 1%CB for the GC-only transaction.
Clarification:
All of the ApplePay transactions between start of promo and 10/2 received 1% CB on the 10/2 statement, and show up under the “Everywhere else” section. In addition, there’s 10% CB on the non-GC ApplePay transactions that shows up under the Apple Pay CB section on the 11/2 statement.
Similarly, all of the ApplePay transactions between 10/3 and 11/2 received 1% CB under the “Everywhere else” section. Presumably the 10% ApplePay CB will show up on the 12/2 statement.
Given that I’m receiving both 1% Everywhere CB + 10% ApplePay CB, I wonder if I would similarly receive 5% Category CB + 10% ApplePay CB for purchases made at qualifying stores e.g. pay with apple pay at a department store. I don’t have any transactions like this in 10/3 – 11/2 period, so I won’t know even after 12/2 statement closes. Anyone else have any data points on this?
Did you have any large transactions without gc? Did you have any small gc purchases? I’m just wondering if they are simply going by the purchase amount rather than actually knowing which purchases were gc.
I have a $325 department store gift card purchase that I paid for via ApplePay + Discover. I’ll know how it’s treated on the 12/2 statement. It received 1% Everywhere CB on the 11/2 statement.
I received my first Apple Pay 10% CB today. It was for a non-GC purchase from 9/25. I also had 2 mixed non-GC/GC purchases from Walgreen’s & Rite Aid that same day that I didn’t receive the bonus for. It’s worth noting that I also had a non-GC Apple Store purchase on 9/29 that I didn’t receive a bonus for yet.
Thanks for sharing this info. It’s not looking good, but of course it’s possible that they simply didn’t get to all of the purchases yet.
One other note. The transaction that I received the 10% CB was for less than $200, while my other transactions around that date that I didn’t get 10% were closer to $1000. Maybe smaller transactions are quicker to receive bonus?
I think the same smaller transaction between the day of 9/16-9/26. Not just being hopeful just some things aren’t adding up for sure. To make a judgment my smallest transaction was after the /5th so it would make sense why I didn’t show anything.
Payment due date was the 28 paid all balance.
Received first credible report that suggests that the gift card exclusion is really being enforced. Via Twitter, b_econ wrote:
Discover statment closed; had GC and non-GC purchase, only 10% for non-GC purchase, FYI – they can tell somehow (went to WAG)
https://twitter.com/b_econ/status/661527615782584320
I’m still unsure. If it it is. But I’m kinda confused still. my statement closed on th 2nd receive my statement today. Purchased from th 16 start of promotion. All types of charges from normal to gift to both. And I got the normal 1%. It could be coming out slowly so that’s a thought.
@Greg
Why not just purchase $1000’s from Bestbuy using Applepay and Discover. Next return the goods for a Bestbuy gift card. Then use the Bestbuy Gift Card to purchase Visa Gift Cards? Then liquidate those gift cards? That would certainly work to show the 10K worth of purchases of non-visa gift cards. Then you have the visa cards and can liquidate easily.
You want to be very careful returning things to Best Buy. Too many returns, meaning 3 or so, and you get put on a blacklist where you cannot return things to BB anymore for ANY reason. I returned an IPhone (switched carriers), Kindle Fire refurbished and something else <$20 within a month or 2 and was put on this list. I could not return anything for 6 months or so? I think the more expensive electronics really triggers this. Just google Best Buy blacklist. Now I only buy things I know I will keep.
Maybe just do it 1 time for a big $4000 or so purchase. I never shop at Best Buy. So being blackballed doesn’t mean anything to me. I just wanna get my 10K worth of spend on this Discover/Apple Pay deal.
Emily,
I noticed you wrote that you received cash back on gc purchases but you never wrote that you received the 10% for AP. Did you mean you received the normal 1%?
Now that FM as well as other bloggers know Disc is reading their posts, we’ll see if the bloggers are wise stewards of ms in the future by not divulging 10%cb success reports (on gcs purchases that did get the cb). If they are truly wise stewards they will remain silent on success reports and leave it all a mystery. Why taunt the dragon?
I made a few gift card only and gift card + merchandise purchases within the first couple weeks of the promo, but as soon as October came around I’ve been hitting Best Buy pretty hard for generally good deals, xmas gifts, and open box reselling oppurtunities. Pretty hard to pass them up when I’m getting (going to get) 11% back from Discover+Apple Pay now, another 11% in a year AND 10% back from Best Buy. Can’t beat an effective 32% back. Also Looking forward to the Black Friday ad and getting in on products early and then leveraging discovers price match the month after. Honestly don’t even need to buy gift cards as it stands right now with holiday shopping and everyday spend included.
Exactly! thumbs up
how are you getting 10% back at Best Buy on Open Box items. I see the discover portal offering 5% but I thought that had to be online purchases…
lol, the poster wants to be bigger than it appears.
Thanks, all done. I got garden green.
Now I need a 6S Plus phone. I have always had a dumb phone and hubby’s is a 4 that DD handed down to him. I don’t want the AT&T Access More card just to get a phone.
Am planning to see if AT&T is ready to give me a new phone. Are there other ideas for getting a 6S Plus?
@Greg The Frequent Miler – I see they have replied to you on Twitter that they are tracking GC purchases. It seems strange that they would have that info. If they do, couldn’t they easily see what pharmacy prescriptions everyone gets? I can’t imagine people would be pleased with that.
PS. Loved your talk in Chicago. Sorry I didn’t get a chance to say hi.
My guess is they are probably doing a manual review OR have written a code/algorithm to review or pick out transactions with a 504.95+x or something like that
and what then? they would still need info from the merchant….
1. merchant will not give that easily without fraud investigation
2. it would still require a lot of manual checking and calculating
3. they would still get to see the whole receipt raising the privacy issues
The algorithm sounds less likely as people can just purchase an additional item at $x.xx to alter the final total.