In the article “Get 10% Cashback with Discover via Apple Pay!”, we introduced an unbelievable deal: before December 31, if you paid with a Discover credit card added to Apple Pay, you would receive an extra 10% cashback. Two months have passed, and many things that were unclear at the time have gradually come into focus. Today, I want to give a dedicated update on a few questions.
[5/5 Update] Discover sent out a mass email yesterday saying it will make up the 2015 Apple Pay 10% cashback. It is likely preparing to pay those who used Apple Pay + Discover to buy gift cards and earn the 10% cashback. At the time, Discover first changed the terms to add a non-gift-card requirement. Then it flatly denied cashback on larger purchases and required users to send in receipts proving the purchases were not gift cards before awarding the cashback. This email shows, from one angle, that while banks may have one-sided terms and can change them at any time, this kind of bait and switch behavior can still come back to bite them.
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Offer Details
Add a Discover credit card to Apple Pay, then use Apple Pay at merchants that accept Apple Pay to earn an extra 10% cashback. Here are a few things to note:
- Eligible period: now through December 31, 2015 (this has already expired!)
- Eligible purchases: must be in-store purchases; gift card purchases are not eligible for the 10% cashback
- Eligible merchants: official list of merchants that accept Apple Pay (some merchants not on the list may still work; if you see the Apple Pay logo, it is worth trying)
- Cashback earned: in addition to the normal cashback you already earn (quarterly 5% or regular 1%), you can earn another 10% cashback.
- Cashback cap: the first 10,000 in Apple Pay purchases can earn 10% cashback (up to $1,000 cashback)
- Eligible devices: Iphone6/6s, apple watch
New Cardholders Can Stack Double Cashback
For new Discover credit card users, they are automatically enrolled in a Double Cashback promotion. Starting with the first statement after approval and for 12 statements total (basically one year), all cashback earned will be doubled. For more on Double Cashback, see: Double Cashback Promotion. So combined with this Apple offer, using Apple Pay can earn at least:
- Regular purchases: (10%+1%) *2=22% cashback
- Quarterly 5%: (5%+10%) *2=30% cashback
There are still 20 days left before the end of the month, which is enough time to apply for the card and then make a holiday purchase to earn 22%-30% cashback (the Q4 5% categories are department stores, clothing stores, and Amazon). If you are interested in applying for a Discover credit card, you can use the referral link below (there is no signup bonus if you apply directly through the official website):
- Discover credit card application link ($50 upon approval, and another $50 after one year)
For a detailed introduction to Discover credit cards, see the link below:
Can Gift Cards Actually Earn the 10%?
When the promotion first came out, most people were eager to maximize the cashback by buying gift cards with Apple Pay. But Discover quickly changed the terms to exclude gift card purchases. Of course, nobody believed Discover could really tell the difference between gift card and non-gift-card purchases. As it turned out, Discover came up with a clumsy move:
- it automatically warned users about larger transactions and said cashback would not be provided for those purchases (purchases made before the terms were changed would still receive the 10%)
Of course, even if you were making a normal purchase, Discover could still flag your transaction. It then added another unreasonable requirement:
- the customer must provide a receipt to prove the purchase was not for gift cards
So if you used Apple Pay, it is best to keep your receipt in case Discover wrongly flags your purchase. Of course, after you upload the receipt, Discover will still pay out.
If you really do want to buy gift cards and see whether you can still come out ahead (after all, the cashback can be as high as 30%), I suggest the following steps:
- keep the gift card amount as low as possible (for example, under 100)
- mix gift card purchases with regular purchases (so the final total is not a round number)
- if you have multiple Discover cards, spread the purchases across them if possible (to avoid being shut down for pushing things too far)
- keep all receipts (even if Discover identifies part of the purchase as a gift card, you can still upload the receipt to get the 10% on the other eligible items)
Buying an Iphone6/6s Without Already Having Apple Pay
What if you did not originally have an iPhone 6/6s to use Apple Pay, but still wanted to use Apple Pay to earn 20% cashback? I personally used this method to buy an iPhone 6s and got the 10% cashback (and next year it will automatically be matched for another 10%). Here is how it works:
- explain to the Apple Store employee that you want to use Discover Apple Pay to buy this iPhone (briefly explain the steps below)
- first pay for the iPhone using another credit card
- open the package and add your Discover credit card to the wallet app on the iPhone
- give the box to the employee and ask for a return and rebuy (return it first, then repurchase it using Apple Pay)
- once the employee has everything set up, use Apple Pay on that iPhone to pay for the iPhone again
- wait about two billing cycles, and you should receive the 10% cashback
Of course, if you have a friend nearby who has an iPhone, you can simply add your Discover credit card to their Apple Pay and use it to pay.
How to Best Use the Discover Apple Pay Offer
After all, 22%-30% cashback is no joke. Basically, anywhere Apple Pay is accepted, I use Apple Pay. Even for everyday grocery shopping, I try to go to places that accept Apple Pay. It is especially useful for products that normally do not go on sale, because paying with Apple Pay makes the most sense there. Good places to use Apple Pay include:
- Electronics: Best Buy
- Groceries: Whole Foods, Sprouts
- Beauty products: Sephora
- Drugstores: Walgreen
- Department stores: Macy's, saks, bloomingdale
- Toys: Toy R Us, lego
- Office supplies, discounted Ipad: Staples
- Gas: Chevron
- Pets: petco
- Cell phone bill: AT&T
Only 20 days left, so act fast. Of course, if you used Apple Pay for a purchase but want to return it, I suggest taking Store Credit instead. That way, you can keep the 22%-30% cashback from the Offer. In effect, it is like using a 22%-30% discount to buy the merchant's gift card.
Things to Keep in Mind
- Keep your Apple Pay receipts in case Discover asks about them
- If you split a purchase and use Apple Pay multiple times, it is best not to make both amounts round numbers
- When buying gift cards, watch the amount, mix them with normal purchases if possible, and keep the receipts
- Do not make too many Apple Pay purchases on a single Discover card; spreading them across multiple Discover cards is better if possible
- Pay attention to the Apple Pay Offer timing, limits, and cap
- For returns, it is best to take store credit