Cash-Back Bonus Changes at PerkSreet Financial


PerkStreet Financial has recently announced to its customers that it's making changes to its debit card cash-back program. Those who have maintained a $5,000 balance so that they could earn unlimited 2% cash back may be disappointed. However, those who haven't been able to maintain a $5,000 balance may be happy with this change. The changes are scheduled to take effect on April 4th, 2012. Here's a summary of the new cash-back program as described on PerkStreet's blog:

  • Unlimited 1% cash back for non-PIN purchases
  • 2% for online purchases at some of your favorite retailers
  • 2% for in-store purchases at those retailers when your balance is above $5,000
  • 2% cash back when you and a friend both pay with your PerkStreet cards together at the same restaurant, bar, or coffee shop
  • 5% PowerPerks at places you choose every month

Some of the retailers listed that will qualify for the 2% cash back include Walmart, Target, BestBuy, Amazon and Apple.

Another change will be a big downside for some. The change is that the 2% cash back will no longer be unlimited. There's a limit of $5,000 in purchases per year that can earn 2% - $2,500 for online purchases and $2,500 for offline purchases.

Another change is that PerkStreet will no longer offer MasterCard Gift Cards as a redemption option. Customers will be able to redeem perks directly into their accounts, but it won't be for the full amount. For every $22 in perks you redeem, they’ll deposit a $20 account credit into your account. They are able to give the full amounts as gift cards since they get a discount when they buy gift cards.

According to PerkStreet's CEO, Dan O'Malley, "over 90% of our customers aren’t earning 2% cash back." My guess is that most readers of this blog are probably in the 10% category. If you're in that boat, I'm afraid you will probably earn less.

Comparing PerkStreet Financial to Other Alternatives

The people who have been best suited for PerkStreet Financial are those who prefer debit cards over credit cards and don't have large balances in their checking accounts. These people may benefit from this change since they'll be able to get 2% cash back from several online retailers.

Those who prefer credit cards may have a hard time to justify PerkStreet after these changes. There are many credit cards that offer over 1% cash back. With the 2% cash-back annual cap of $5,000, customers can only earn up to $50 more per year than they would with just 1% cash-back.

Those who have large savings that they want to keep liquid can probably do better in reward checking accounts. For example, if you have $25K in a 2.00% reward checking account, you'll earn $500 per year from interest. That's at least $250 more than keeping that $25K in most internet savings accounts. You can get a higher rate than this. Please refer to our reward checking table to find the best rate that's available to you.

PerkStreet Financial Checking Features

PerkStreet Financial's checking accounts do have several nice features such as free ATM usage (in the Starsf ATM network) and many easy ways for making deposits. One unique deposit feature that I haven't found at other internet banks is a free way to make cash deposits. PerkStreet customers can deposit cash free using MoneyGram Express Payment. According to PerkStreet there are "18,000 locations nationwide, including every Wal-Mart store.

There is no minimum balance requirement. There is a $4.50 monthly fee if the account is inactive. This can be avoided by using the account (debit card usage, writing a check that clears the account, using Online Bill Pay, initiating a withdrawal or making a deposit to the account).

PerkStreet Financial Overview

According to the PerkStreet Financial's website, banking services are provided by The Bancorp Bank which is a FDIC member. The bank has an overall health score at of 4 stars (out of 5) with a Texas Ratio of 12.21% (above average) based on December 2011 data. Please refer to our financial overview of The Bancorp Bank for more details. The Bancorp Bank has a been a FDIC member since 2000 (FDIC Certificate # 35444).

Update 7:00pm The NYT Bucks blog just reported on this change. The article and the comments provide some interesting insights about if there's more to this change than what PerkStreet disclosed.

Anonymous   |     |   Comment #1
These rewards programs are getting ridiculous with their terms and conditions.

How about, in addition to the confusing terms:

2% for purchases made between 3pm and 4pm on  Wednesdays.

2% for all purchases at merchants whose logo is blue.

2% for all purchases made on days when the moon is full.

2% for the first 3 lowest priced items of each purchase and 1% for the other items.

2% for purchases made on days when the ratio of the Euro to USD is between 1.26:1 and 1.30:1.

2% on purchase during each day Lindsay Lohan is not in rehab/jail/trouble...
custom gift cards
custom gift cards (anonymous)   |     |   Comment #2
These registration taps help us to avoid any security problem.
Anonymous   |     |   Comment #3
Ken, tracing your reader without telling them they are being traced is illegal.
Censoring your readers is equally bad and not allowing true Anonymous posting will make the rest of your supporters including me, to flee this web site.
Without your readers, this site will never prosper. There are hundreds of other financial and banking sites that are much more informative than this one.
Something to think about, before you delete this posting.
Apache   |     |   Comment #8
#3  Where are all those other websites that are more informative than this one?  I thought I found about all of them but I still would not start my day without finding out what is the latest info on here.  One thing Ken has here is that his info is usually "up to date".  I can remember recently getting all excited about finding some GREAT CD rates on another site and I fell back to earth after calling the banks and finding out they were "old" discontinued rates!  I went back to the page and in "tiny" letters they had the date and it was over 3 years old!  I emailed them and told them how unfair it is to CD seekers to post such out-dated rates and not have the date more prominent.  We may not like the rates we see nowadays posted on Ken's page but at least we know they are recent. 
Anonymous   |     |   Comment #4
They cannot be serious. Have they any marketing or consumer reward programs experience? What is the management of this bank thinking? Or better yet, seems like they aren't thinking. Nothing like keeping it simple. These guys should be out of a job.
Anonymous   |     |   Comment #5
To Anonymous #3 - hello???  Tracing is perfectly legal.  Every time you do a search or visit 99.9% of sites, you are being tracked.  This is Ken's site, and he should be free to do as he wishes.  If he wants to censor, he can censor.  If you want your posts not to be censored, get your own site and post whatever you wish.  It's not like he is charging you memebership fees - he provides this excellent resource to all for free with minimal and unobtrusive advertising.

Yes there are hundreds of financial sites out there, but NONE as organized, informative, and useful as this one.  Ken - you are doing a fantastic job and we all appreciate it.  Please keep up the good work and don't let a few bad apples ruin your day.
Anonymous   |     |   Comment #6

@ Poster #3

Can you please expound on your definition of being traced? Does Ken know in what general area I am posting? Yes. Does he know my name and address? No. Think about this; the next time you log onto your bank, email, or even the weather page, your are being tracked. The next time you check your gmail account take notice of the ads on the right. Doesn't it seem odd that they coincide with the contents of your email. Yep, they are using key words from you personal email to target the ads to you.

If you're concerned about being tracked do the following. First, set your browser to the “private” setting. Clear all of your cookies after each use. And most important, don't remain logged into any website. That's when you can truly be tracked. Use some good virus and malware programs and you don't have to worry.

Now, Ken, if you know who I am and where I live because of this post, dinner is at 6:00pm. Come on over. I'll set a place for you.
Anonymous   |     |   Comment #10
Ken--I disagree! Most your readers probably have their money elsewhere earning much more in interest and service than Perkstreet; and, most readers use their credit cards to earn the most points (like the 5% rotating category cards; the 3-1% card; the 3-2-1% gas, grocery, everything else card; the 1.5% card; even Chase Freedom with Chase Checking works better than Perkstreet,imho).

The negatives, as you stated: You earn zero interest. You must use Starfm ATMs to avoid fees; otherwise, they charge $2 fee, they will not reimburse refund any ATM-fees surcharges. You still need $5,000 minimum balance to get 2% on all purchases, up to the maximum purchase now of $5000. Worst part: When you go through online application for the Checking account, you cannot choose to decline the Overdraft Protection (at least that was the case in December 2011 and February 2012).
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