Monday, May 6, 2013

The Ethics of Credit Card Rewards

I was asked an interesting ethical question at my Shabbat table and I am not sure of the answer.

Credit cards offer certain deals to potential customers.  They offer airline miles, points, or cash for people who sign up and spend a certain amount.

There is a whole genre of blogs that search for these deals and share them with their subscribers.  They instruct their subscribers on how to game the system: sign up for the deal, receive the reward, and then cancel the card.

Is it ethical to play the credit card rewards game?

On the one hand, I am certain that the credit card companies factor in the people who learn to work the system.  They are offering the deal and must realize that people can take advantage of it.  They must factor that into their costs.

But grocery stores factor shoplifters into their pricing too.

Or perhaps the credit card companies profit from the people who work the system.  Maybe the fees that they receive from the vendors offsets the rewards that they give the customers.

Or perhaps the credit card companies are counting on people signing up for the card thinking they will profit, while most people end up forgetting to cancel, or end up becoming a regular customer.

Does anyone have any insight into this question?