Most debit rewards programs are gone or largely neutered, a retaliation by the banking industry in response to pending caps on transaction swipe fees. Now merchants are coming to fill the void. Stores are partnering with banks to experiment with “merchant debit rewards” which give shoppers discounts for shopping at their establishments. Here’s how it will work.

The NY Times Bucks Blog reports that you will log into your bank account and click on something like an “offers” tab. You will then see a list of various deals, chosen to be offered to you based on your purchase history. If you see a deal you like, you click on it to activate. Then when you shop at that store, you’ll get whatever money back promised by the deal deposited back in your account after your shopping trip, or it may be applied at checkout.

The store pays the bank a fee based on the total sale price. (See, this is just shifting around how the old debit rewards system worked. Since banks can’t charge as high fees to the merchants, fees which were partially subsidizing debit rewards, the banks are making the stores pay them like it’s a promotion).

Essentially, it turns your bank statement into a personal coupon booklet. Sounds fine, who doesn’t like a coupon? You know that the stores will build in the cost of the promotion to the prices, so you really you can’t win with this gimmick, you can only lose if you don’t take advantage of the coupon after you’ve already decided to buy that item at that store.

A New Type of Reward With Your Debit Card [bucks.blogs.nytimes]

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.