A great disturbance in the Force


In the past few days I’ve been writing a lot about the ability to buy $200 Visa gift cards online from Staples.  This event, in itself, would be unremarkable except for a number of other forces that have converged:

  • Chase began to issue Ink business cards as Visa cards mid 2013 (previously they were MasterCards).  And, both the old and new Ink cards continue to offer 5X rewards at office supply stores.
  • Visa Savings Edge now offers 1% cash back for Staples purchases made with Visa business cards enrolled in the program.
  • Purchasing gift cards from Staples.com through cash back and point earning portals continues to be successful in some cases.
  • Evolve Money has made it easy to use Visa gift cards for payments to loans, mortgages, education savings programs, and more.
  • Since early 2013 Visa and MasterCard gift cards have become PIN-enabled.  This makes it possible to use gift cards for many more purposes than ever before.  See “Gift card PINs.”

The convergence of all of the above means that it is now possible to earn a profit, and 5X points when buying Visa gift cards.  For details, please see my prior posts on this topic:


Too far out of balance

The current situation is great for anyone with a credit card that earns bonus points at office supply stores, but its not good at all for the banks that supply the cards.  And, it is probably even worse for Staples.  They are the ones that have to pay the online portals, and they are ones most likely footing the bill for the Visa Savings Edge benefit.  It is inevitable that things will change.  Below are my thoughts about what might change…

Chase to remove 5X benefit?

Per Hack My Trip, Chase may be considering dropping the current Chase Ink 5X category bonuses.  His source is a reader who was part of an online focus group.  The fact that they are asking people for feedback about this idea implies that it is not set in stone.  If they do change the bonus structure of the Ink cards, another question is whether the change would be just for new cardholders or existing ones as well.  In the past, changes like these (when they first introduced the 5X benefit, for example) did not apply to existing cardholders.  Hopefully that will be the case again.  In fact, it would be an awesome opportunity for existing cardholders because we could theoretically keep our existing card(s) to retain the current 5X benefits, and then also sign up for the new card with whatever new benefits it offers.

Banks to lower the cap on the 5X benefit?

Chase already has a cap of $50K per card-year in spend to get the 5X benefit on the Ink Plus and Ink Bold cards (and a $25K cap on the no-fee Ink Cash).  Similarly, the Amex SimplyCash card has a $25K per year spend cap.  And, the Discover business card has a ridiculously low $2K spend cap.  I could imagine Chase and Amex lowering their existing caps, but I doubt very much that they would go lower than $20K per year.  These are business cards, after all, and so high spend in the bonus categories must be expected.

Banks to stop awarding bonus points on gift card purchases?

There is already some evidence that Amex may have stopped awarding grocery store bonus points at Safeway stores when the purchase is made with the Blue Cash Preferred card and consists entirely of gift cards.  It’s possible that this approach will expand to more stores and more situations.  I expect, though, that this would be a major technical challenge and would not be accomplished anytime soon.

Staples to stop selling $200 Visa cards online?

This would undoubtedly be the easiest solution for Staples.  However, since they just introduced the product online, someone at Staples must have thought it was a good idea.  It seems unlikely to me that they’ll reverse course too quickly.

Staples to pull out of Visa Savings Edge?

Staples could get a small win by simply pulling out of the Visa Savings Edge program.  That said, the 1% payout is a really small part of the problem.  The deal would still be profitable to customers (and a loss for Staples) without that little piece.  So, my guess is that they’ll leave it alone through the end of this year before killing it.

Staples to stop paying out through portals?

I would really hate to see this go, but it would make sense for Staples to stop paying out to portals for gift card purchases made on their site (or, as some other sites do, they could pay out less for gift cards).  The fact that they currently pay out to portals for gift card purchases suggests to me that fixing this may be a complicated technical challenge.  The best we can do is hope that it takes them a long time to address this!

Gleaning insight from the past

The last time stars aligned to equal grandeur was when Bluebird was released in the fall of 2012 (see “Bluebird takes flight and changes the game”).  For a short time, it was possible to buy Vanilla Reload cards at Office Depot with a Chase Ink card to earn 5 points per dollar, feed the reload cards to Bluebird, and then use Bluebird to pay bills or even to simply withdraw the money.  It was the perfect perpetual point machine.  In those glory days for point hounds, the big loser was Chase since they had to pay out huge rewards for little gain.  There were rumors at the time that Chase leaned heavily on Office Depot to encourage them to stop the madness.  Less than four weeks later, they did (see “Office Depot discontinues Vanilla Reload cards”).   So, if those rumors were true, I wonder if history will repeat itself?  Will Chase lean on Staples to fix the “problem”? 

Placing bets

Regardless of how it happens, I have no doubt that this situation will not last indefinitely.  The real question is whether it will last for days, weeks, or months.  If I was a gambler I would readily place bets that it won’t last for even half a year.  More likely, I think, is that we’ll see changes within two months.

What do you think?

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They were forced to take the money so the public did know who was the weakest banks. They did not want it and gave it all bank once they could. Educate yourself before you spew this garbage.

[…] I’m including it because you can get 10% cash back on online purchases at Staples. Remember what’s on sale at Staples right now? You get 5% back on the card and 5% back from Upromise. Other people have had bad experiences with […]

[…] usually takes 1-2 months for them to pay you, but this is still a great deal. Frequent Miler has a great post today about the economics of this deal and how he thinks that it won’t last very long. It is […]


I’ve been a doomsayer on a lot of gravy train related behavior. And I’ve been proven right this year, unfortunately.

But Staples will not be changing much, if they can help it. Their ebusiness is a major bright spot. Possibly the only one in their US business, actually. As someone mentioned, they are the #2 online retailer in the US. Yes. #2. Not wal-mart, not Target, it’s Staples.com. If same store sales were flat, I’d be concerned, but they are down consistently.

As such, I think they’ll take a don’t rock the boat approach with their ebusiness.

Having said that, how about we make it easier for them to sustain this? Don’t rock the boat. Be responsible.

Credit Card Joint

All good things come to an end. Yes, Staples will stop giving portals payouts on gift cards. It is a matter of time.

However I don’t think that time is yet. Look how long the CVS Vanilla Reloads were alive for.


If gift cards are so very profitable for Chase, why did they stop selling them themselves?


I appreciate you drawing attention to this deal and may take advantage of it, but only for 1-2K worth. my ink is the only UR card I have at the moment and I have 192K UR points that I don’t want to jeopardize by going overboard…+ the smaller denominations are more painful to get rid of.

As far as writing about the demise of part or all of the deal in your 3rd day of coverage….are you trying for a self-fulfilling prophecy?


@All the haters – This is the game. Get used to it. Bloggers will post whatever they want and don’t care what you think. Crying about what bloggers post is like complaining to a ref about a call. Suck it up and play on.


@iahphx–same with my order from Monday. Makes me think that they aren’t going to be shipped……


Nothing will change on Staples side… they know very well what they are doing. They are the #2 online retailer in the world right after Amazon… and they want to keep it that way. These gift cards help the revenue tremendously… That’s why they added the $200 option, they want us to spend more. They are transitioning from a store focused on office supplies (less and less relevant) to an online technology retailer (more and more relevant).
They need to show revenue growth in their on-line unit, otherwise investors will flee.


I can’t imagine staples or chase not knowing what is going on. They know it. Chase got bail out money. It makes billions on consumer credit cards. The reward miles it purchases from airlines is pennies on the dollar. Plus it gets a lot of swipe fees to boot. These are banks guys, they always win. No way would they allow this game if it was killing its bottom line. Staples has had enormous growth in sales because of MSers. We are propping their balance sheet up with all this gift card buying. The company that is making a killing is Visa. I suggest you MSers buy it’s stock.


Haters, why are you reading???


Has anyone actually been shipped the $200 gift cards from Staples this week? I ordered some on Monday, and they’re still “processing” the order.


I think these speculative posts in leading travel blog like yours should come to an end as this is feeding the bank and office store PR people with ideas for sake of some clicks. Why not just enjoy the perk as long as it lasts without any speculation? I didn’t expect this at least from you. Disappointing .


As I responded to others here, I write about what interests me most, and this happens to be an exciting development. If I was after clicks you would see completely different content here. I believe that the writing is already on the wall with this deal, so the more people that can take advantage of it now, the better.


Exactly. I dont see you as one after clicks and that is why i felt so disappointed. You deserve to be at the top for not pumping credit cards and coming up with original ideas but these kind of speculative posts from a person of your stature will kill the deals faster as it might feed ideas to the bankers themselves. That is why i feel you shouldnt be writing about this.

Anyway, the writing may be clear on the wall from bank’s perspective but for visa and mastercard to make more money, they have to keep these going. In fact i have a hunch behind strange re-appearance of 200$ gift card at staples online – just after visa’s lower than expected results last quarter. Well, this is one of the ways for them to improve their profits this quarter and there you see this card online and sales for visa gift cards would have zoomed in the past week. So, it might come to fight for survival among corporates and they may not allow this deal to die quickly, especially if the econonmy is not doing well. Let us see.


Wow, three days of blog posts pumping the staples offer, now writing about how and why the deal will end.


If this bores you, then don’t read it. I happen to think its one of the most exciting developments we’ve seen in a while.


I too find it exciting. I am referring to the cycle of. . .. good deal -> overexposure -> stoking fear of deal ending -> panic buying -> deal collapses. If people would just chillout and add these deals moderately into their current spending pattern they would probably last a lot longer.


I like to think the $25k i keep in my chase checking account makes them less likely to question my ~$3k of 5x spend at office stores a month. But I have the wife’s card too, of which I do about $2k in spend. So $5k spend @ 5x total per month with aprox $35k in checking between her account and mine. I’m scared to ratchet it up any more and am more than happy pocketing 25k miles/month from Ink products alone.


What a great way to drive noobs to click more affiliate links! Make em afraid that the deals are gonna go away in 2 months!!!!

C’mon, this post is as gratuitous as it is ridiculous.


C’mon, if you’ve read my posts often then you know I don’t write content for the purpose of driving credit card signups. I write whatever I’m interested in and this happens to be top of mind for good reason.


Whenever I come across a shutdown/issue I put them in a file, which I realize is a little insane.

The one thing all the shut downs had in common was no 1X spending, while the GC spending ranged from $5k to $20k a month (a lot!). I try to stay well within the boundaries, which to me is considerably more total 1X than total 5X. Of course everyone’s comfort level is different. YMMV


Thanks for that info!


Thanks sfmom. That’s exactly what I was looking for. And I LOVE the fact you keep all that info in a file. If I came across it, I would have done the same.


Would anyone mind posting what you all think is reasonable (i.e. Chase wouldn’t shut down your account for that amount of spend)? I know this is purely speculative and could be flagged by a change in account spending, but just wanted to see what your all’s thoughts are.

I had just bought 10 $100 cards about 2 weeks ago and just bought 10 more $200. I normally have around $2-$3k spend per month on the card in various other locations.


Don’t forget that there are also Millions and Millions of $’s in lost cards that the issuers just pocket too. Gift cards exist for a very good reason. They are extremely profitable on a large scale.


@Tom – Great point and one I never thought of. The float on these prepaid cards is probably hundreds of millions (if not billions) of dollars at any one time. This amounts to a huge interest free loan. Another reason card issuers like these card.


I do not get it. American Express makes a ton of money on the float on their cards even if the funds stay in their possession for one day. This is why they make is so easy to purchase their cards and have the BB and Serve cards. THE FLOAT! Chase, Citibank and BOA will even catch on and probably make even easier to do MS. Who gets hurt? The consumer, no one else. This will result in the inflation of travel, i.e. flights, car rentals, and hotels.


There is no doubt that there is money to be made by the banks here, but not if they pay out 5X and not for the stores if they pay out 5% or more through portals.


My guess is portals won’t pay out, possibly even for yesterdays purchases. The overwhelming surge of activity will certainly have staples investigating “why”.

In other news this photoshopping has gotten out of hand. Does the purple ninja with a tennis ball on a stick, really need to be slicing a visa gc? 😉


LOL, sometimes I get a bit punchy at the end of the day if/when I add graphics


Ok, the picture itself was kind of funny, but the characterization of it as a “purple ninja with a tennis ball on a stick” made me actually laugh out loud.
BTW – this post just makes me more frustrated that I don’t have an ink


I think Visa/MC/AMEX gift cards present an interesting issue in terms of MS and arbitrage since they are, in general, a real cash cow for the credit card companies. The card companies make huge profits on them and continue to push these products. However, almost any prepaid card is terrible for consumers since they charge high fees and over little benefit over using the cash without the restrictions these cards impose. Of course, we have turned these cards into big mile machines.

If any one knows the financials involved in selling these I would like to know. Google didn’t yield clear answers. For example, does staples pay a credit card fee on all 200 dollrs or just the activation fee? And who keeps the $6.95 fee, is it split or just to Staples or the card issuer?


I suspect the GC issuer fronts the swipe fees, since they expect to make it back when the GC is swiped. They probably expect to make much more, though, because the GC might be swiped for many small purchases, where the minimum interchange fees will effectively be higher than 1-2%.

Staples likely gets a small commission per card and some set payment for the floor space.


I’m with Chris. I’ve read too many shutdown stories (and more recently, stories of Chase CSRs accusing cardholders on the phone) to go big on this or any other quick deal. I buy a certain amount a month and that’s it. Hoping the 5X GCs last as long as possible.


Yep, it definitely makes sense to keep this within your comfort zone.


Just wanted to thank you for the extremely insightful post. I always look at MS as a form of arbitrage. And as such, it is often impacted by various economic factors due to incentives or costs across various parties: us, the banks, the stores, etc. I love you you laid out the factors and why this may not last long. All too often people in MS complain that their gravy train ended or stay nostalgic of past deals. But that is just the economic forces in action. Your statement of “too far out of balance” was spot on.




Not really sure of the point of this post other than to bring attention to the same things being talked about over the last couple days.


I’m not really sure all posts need to have a “point”. I write about what interests me. Its as simple as that.


Me thinks there should probably be more pending charges on my Ink at this point. This definitely won’t last forever, but certainly don’t want the gravy train to cause issues in my relationship with Chase.