Cash back program didn't count food as groceries

November 12, 2010 1:33:01 AM PST
There are credit cards that give you cash-back rewards for certain purchases, but some customers in the North Bay found out their favorite grocery store didn't qualify. It made no sense to them so they called 7 On Your Side.

There is an American Express card that gives cash-back rewards for gas, medicine, and grocery purchases. However, 7 On Your Side was called when the groceries at a popular local market didn't qualify as "real" groceries.

Linda Vela does most of her grocery shopping at Good Earth Natural Foods in Marin County. She likes it far more than shopping the national chains.

"The food is so much more wholesome. It's fresh and when you walk in there, you smell fresh food," says Vela.

Vela finds everything at the store: fruits and vegetables, chicken and fish, milk and eggs. So she was really surprised when her credit card company said these were not groceries.

"I don't think it's fair to be discriminating against one type of food," says Vela.

Vela uses the American Express Blue Cash card. It gives customers up to 5 percent cash back for all the groceries they buy, but not if they buy them at Good Earth.

"They didn't tell me when I signed up for the card that it was only good for certain purchases," says Vela.

A blue card statement designates Safeway and IGA super market chains are indeed grocery stores, but not Good Earth. This led co-owner Al Baylacq called American Express to find out if organic, local products food didn't qualify as groceries.

"We're a grocery store. Why can't our AmEx customer appreciate the same rewards as if she went to Safeway down the street? I got a very respectful phone call in the following weeks saying that we were simply not eligible, that the program is set up for bigger retailers than us," says Baylacq.

American Express told him Good Earth is not a grocery store, but that it is a specialty store. Good Earth shoppers were certainly surprised to hear that they weren't really buying groceries.

"I don't think eggs are specialty food, I don't think milk is specialty food, I don't think chicken. Maybe they're driving you to go to places like Albertson's or Safeway," says Vela.

Vela says she wouldn't give up her favorite grocery store just to get cash back. However, 7 On Your Side got involved and things changed rapidly after that. We questioned American Express about the grocery policy and the company did a complete about face.

American Express said, "We updated our records so that ... our Blue Cash Card members will now be bonused for everyday purchases at Good Earth.''

Customers will now get cash back for shopping at Good Earth. American Express did not explain why the rewards were previously denied, but said any grocery store qualifies, not just national chains.

American Express says it will reimburse customers for rewards they should have earned at Good Earth so far this year. If you notice you're not getting cash back for qualified purchases, American Express says call the number on the back of your card.


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