February 1st, 2010

where's george?

TD Bank debit card grocery promo

Apparently, this TD Bank promotion has been running since January 17 but I only noticed the ad today in the Sunday newspaper. The banner ad has probably been up on the TD Bank website for a while, which goes to show how I tend to tune out online ads these days. Basically, you get $10 back in gift cards for every $100 in signature-based purchases at grocery stores using the TD Bank debit card.

What I'm wondering though is what's the catch? What's in it for TD Bank? No doubt they get a cut of the merchant fees but that's not anywhere close to 10%. There's the obvious: TD Bank hopes that people who are not TD Bank customers will sign up for checking accounts to take advantage of this offer and that people who haven't been using debit cards will get into the habit of using those. I suspect there is something a bit more insidious in play too. Signature purchases can take a few days to post. So maybe the bank hopes that some percentage of people who start using debit cards instead of cash for groceries will accidentally overdraft their accounts and incur bank fees, perhaps enough in fees to more than offset the $10 bonus for everyone.

That aside, it's a simple-enough deal for me to snag since I already have a TD Bank account. The annoying part is using the debit card will cut into my Where's George activity. (The link goes to a Yahoo article mentioning Where's George that bogged down the website with heavy traffic today.)