Gift Card redemption fees (no communication about new fees)

Apparently SmartyPig and their gift card partner started imposing fees on us on July 1st.
They did not send out any communication on this that I can find.

Now if you want say an Amazon gift card for $50 you will loose money. The fee is $2.25 at this moment. The boost you would have gotten for using SmartyPig with Amazon would be $2.
So now you are out 25 cents.
And even better the $2.25 fee is the same regardless of if it is a physical gift card or an ECard.
Is this the benefit of the "BBVA Compass And SmartyPig Announce Strategic Alliance"?
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  • David,

    Thanks for the post. Our discounts and rates can vary at anytime. And is at the retailer's discretion. As our company grows our cash boosts will get even better. I have a number of new retailers I'll be adding to the site soon that have cash boosts of up to 20%. We have instituted a new processing fee across all orders (regardless of the number of cards) but have still left a free shipping offer. This was done as we were actually losing money on very small gift card redemptions. We will also be launching a new redemption product in the coming months that I think many customers will like. As you mentioned, if you try and redeem a small denomination and only order one or two of the cards, you do not see a net cost savings after you figure in the processing fee. Larger goal redemptions spread amongst one or multiple retail cards is when you see the greatest cash back benefit. Thanks.

    Mike Ferrari
    SmartyPig co-founder
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  • nilskp,

    We are working hard to bring e-codes back. We had to remove them from the site for a period of time.

    Thanks.
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  • I’m frustrated
    Now........you will only be able have to have $25 gift certificates.....at $4.95 Priority Mail, and $2.25 processing fee! .........I didn't know this and ordered $2100 in gift certificates for Amazon, only to find out that SP was sending 84 $25 certificates!!! Unbelievable!!! Who would ever okay this system in the first place! And......now I have to wait 4-6 days, while the price I had hoped for goes up, and takes away my $84 savings from SP! Needless to say, I will not be using this system again until it is more user friendly!
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  • I’m frustrated
    the current system at smartypig is FAR TOO CUMBERSOME - and the FEES on the gift cards have to GO. Fix this fast - or I for one am out of here.
    AMAZON Needs to be an ELECTRONIC certificate - ONE CODE for whatever amount you buy. It better be ONE Code - if you send me 40 codes for $1000 I am going to leave in a blinding hurry. If small redemptions are costing you money than make a new rule - no giftcards under $100 or $200 or whatever it takes - but READ MY LIPS: NO FEES!
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  • I’m splendiferous
    I am unhinged - especially when things that should be easy are complicated.
    • @Ken,

      Thanks for the post. As I mentioned above, we are working hard to bring e-codes back. We will have them implemented this month. We won't be able to have one e-code for the total, but we will have much higher e-code denominations (exactly like we had before). And yes, there will be no processing fee for e-codes. However, there will be a processing fee for fulfilling physical retail gift card orders that must be shipped.

      Thanks.

      Mike Ferrari, SmartyPig co-founder
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  • This was a major change that should have been communicated so that people could redeem cards prior to fees being implemented. I certainly would have rather redeemed mine prior to the change instead of being backed into a larger gift card for which I have no use for.

    FYI, the FAQ still lists "SmartyPig customers may also make contributions to other users’ goals or buy SmartyPig gift cards at NO cost if they use their existing SmartyPig funding source."
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  • I’m bellicose
    If I don't have a clear and easy way to buy a $1000 amazon gift card that doesnt expire and doesnt have any strings (like 50 $20 codes - get real) and doesnt have any fees and gets me $40 cash back BY AUGUST 31 I am closing all my pigs and moving on to greener pastures. I smell the FDIC breathing down SMARTPIG'S neck any day now... If you want to learn about the proper way to run a bank, study PERK STREET. Nickel and diming your customers with gift card fees is ill advised.
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  • I’m pignoble
    is your post of 23 days ago still true? that ecodes for amazon will be available before September 1 2010?
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  • I’m feeling mislead
    I just got nailed by this as well. Very discouraging since one of the reasons I signed up for SmartyPig was for the retailer bonus. I scoured the site prior to signing up and all text says "no fees" so I had assumed there wouldn't be $7.20 of fees to cash out a goal. I can understand that you have a business to run, but please be upfront with the fees for each retailer so that I don't feel cheated when cashing out.

    I like the idea of goal-based savings, but the fees and wait time for physical gift cards to be delivered is a show stopper. I'm seriously considering going back to high yield online savings + credit card (with cashback) instead of SmartyPig.
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  • The real problem here is that these fees aren't disclosed ANYWHERE. This forum thread is literally the first and only mention I found of them. There are no asterisks, there is no small print! There's ABSOLUTELY NOTHING! Customers won't see this fee until they've 1) created an account (and given you their SSN) 2) opened a goal ($25+) 3) completed the goal ($???) 4) started the cash out process.

    Posting the fees for each applicable merchant alongside their listing in the FAQ is the right thing to do. Being clear about these fees when you're proudly advertising "Up to 12%" on your front page is also the right thing to do. Doing neither of those raises questions about the potential for hidden fees elsewhere, the truthfulness/accuracy of the advertised percentages and rates, and the trustworthiness of your company in general.

    Yes, this is all 'just' for the gift cards, which are a subset of the whole smartypig package, but skimping on disclosure, especially when it involves the accuracy of your advertising, is truly entering perilous territory.

    Meanwhile, you've started to regularly fill my inbox with annoying messages about surveys and contests.

    WHAT ARE YOU THINKING?
    • I couldn't have said it better myself. I suggest you speak with your dollars as well.
      I closed my accounts within 2 months of opening them because the entire site was far too cumbersome, and these clandestine fees were the last straw.
      In the final analysis this pig will not "get it" until we are all gorging on bacon. Their "customer service" is truly abysmal and the sneaky fees are always symptomatic of a much larger disease. Only a matter of time until the FDIC starts serving up bacon burgers.
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  • I’m Bacon My Way Back To Ewe Babe
    Still "working through the logistics" of eliminating those ridiculous fees on the AMAZON gift codes? No matter - I completed working through the logistics of closing all my pigs and moving my money BACK to a reputable bank.
    • view 1 more comment
    • SavingsOne, would you mind disclosing where you can get 3%, these days. And that 4% too.
      A look at Bankrate.com shows that to be almost too good to be true.
    • SavingsOne: It's arguable that those 10 debits a month are themselves hoops to jump through. In my case, I don't shop all that often, so I'd typically only end up with maybe 5-7 transactions in most months.
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    • view 2 more comments
    • Take a look at this site.........Earlier I had found 4% at Danvers Bank (1-800-771-8200), but now learn they have changed to 3%. I think South Division Credit Union is still at 4.01%, but not really sure. I googled Danvers and came up with the following site that may give further info. I haven't decided yet what to do except that I am moving my money. Good Luck to all!!! Link:
      http://www.depositaccounts.com/blog/2...
    • @SavingsOne: your link is chopped off - perhaps it's too long for this forum.
      Onlookers may wish to try: http://tinyurl.com/3xe722l

      Formerly at bankdeals.blogspot.com, that's a great web site for not only interest-checking, but also CDs, savings, money market accounts, etc.
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  • I’m Pignacious
    Might I suggest this to all those looking for a decent yield: Take all your cash OUT of the banks and put it into REAL gold and silver. You'll gain 20% MINIMUM per year, and eventually be sitting pretty when the house of cards Bernanke has built comes crashing down.
    • Actually, far from it. Gold has historically had lower returns and higher risk compared to the S&P: http://spreadsheets.google.com/pub?ke...

      Between 1980 and 1985, which you may remember had two nasty recessions, you would have lost half your money. Isn't gold 'supposed' to do well in hard times?

      When you buy a stock or similar traditional investment, you're getting a share of a company's future revenue and productivity. Gold (and other commodities), on the other hand, are purely speculative objects that you have to keep locked up in a vault somewhere, in hopes that some Greater Fool will someday pay more for them than you did. Remind you of anything?

      Gold is worth considering as a COMPONENT of a portfolio, but it's never a good idea to put all your financial eggs in one historically risky basket.
    • All I know is we bought silver 20 + years ago and it is just now back to where it was.....
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  • We have an update on the status of e-codes with Amazon. As of late last week, we are now approved for e-codes for Amazon and are working with Amazon on the procurement process of the codes. We do not have a specific timeframe on the codes right now, but when we do we will update you. Once the e-codes are live there will be no processing fee with Amazon. Sorry for the delay, however, we have been at the mercy of the Amazon review and approval process. Thanks, John
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  • We are happy to announce that once again we have Amazon e-codes. Also, orders placed to Amazon will no longer incur a processing fee. We thank you for your patience as we have worked with Amazon to bring this feature back to our users, and truly appreciate the feedback you have shared with us. Thanks, John
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  • I’m almost ready to redeem my Christmas SmartyPig goal!
    That is indeed great news. It's just in time for Christmas shopping!

    But I think the OP brought up *two* issues. First was the fees - which is finally put to rest. Second was the lack of communication - as reiterated in later comments by Joy and Nick.
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  • Good News! We are no longer charging the processing fee for goals closed to a Retail Gift Card. Please check out our blog that was posted today.

    http://blog.smartypig.com/read/proces...
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  • wow its great to see Smartypig COMPLETELY ignore peoples questions, I think the tenor of the complaint was about lack of communication and as if by ironic virtue, you have demonstrated it here in your answers..... People want to know why they were not informed about the fees prior to them coming about.

    If you do eventually plan to operate here in the UK, such an action could result in losing your license to trade as a financial institution, Our laws take lack of disclosure incredibly seriously and can amount to criminal consequences, not just civil.

    Its a shame, as I was quite excited when I heard about smartypig, I even posted that I would love to see it in the UK, but after going through these forums and seeing all the smoke and mirrors and sheer ignorance of the SP staff in their (partial) responses, I think im better off sticking to my bricks and mortar bank that are legally bound to be answerable to me.
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    • Well please do not doubt what I am saying as I am a former employee for the FSA! -

      ANY financial levy or charge that has any connection to a financial product, in the UK, simply has to be communicated prior to commencement of service. In addition to this, SP also has lowered interest rates and admitted they did not contact any customers to let them know. Both of these actions would result in heavy penalties if not removal from the Financial Institution Licensing.

      "The bank part of SmartyPig has not imposed any hidden fees. Only the gift card redemption part temporarily had fees"

      Your logic is wrong, a financial institution does not have "parts" all are seen as equal under financial regulation, and the same rules apply universally no matter wether its insurance, gift cards or a holiday in the bahamas, if they are a financial institution, they have regulations to meet and laws to follow..... I was only stating that in the UK these actions would have been considered intolerable.
    • If by "poorly communicated" you mean "had no mention anywhere until you had signed up, deposited money, and were literally cashing out" then yes, they were.

      Meanwhile, those same redemptions were (and still are) being advertised on the front page. Get up to 14% cash back! No, they're definitely just as much a "part of the package" as any other advertised feature.

      I personally closed my account and went elsewhere a few months ago. The bad taste I got as a result of this particular experience was a big motivator in doing so. I suppose I'd better shut off my notifications to all these threads now.
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  • I’m anxious
    I think until we learn how to manage our debt crisis, everyone should learn how to get a mortgage. I mean seriously, even with so many coupons, getting satisfaction is not as easy as it sounds, and we really need to reign ourselves in if our future is to be as secure as we hope.
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