How Cashback Really Works
Cashback websites have become a popular way for online shoppers to save money. But how does cashback really work behind the scenes? In this article, we explain the process in a clear and transparent way.
What Is Cashback?
Cashback is a reward mechanism where shoppers may receive a portion of their purchase amount back after shopping through a referral link. Instead of receiving an instant discount, cashback is typically tracked and later confirmed by the merchant.
Cashback does not reduce the price at checkout. You pay the same price as you would when shopping directly on the merchant’s website.
Where Does Cashback Come From?
Cashback is funded by merchants, not by users.
When a shopper clicks a link on a cashback or affiliate website and completes a purchase, the merchant may pay a commission to the referring platform through an affiliate network. Some platforms choose to share part of this commission with users in the form of cashback.
The Cashback Process Step by Step
1. Clicking Through an Affiliate Link
When you click a store link on a cashback website, you are redirected to the merchant’s site through an affiliate tracking system.
2. Shopping as Usual
You browse and complete your purchase directly on the merchant’s website. The cashback website does not handle payments or orders.
3. Tracking the Transaction
If tracking works correctly, the merchant records the purchase as coming from the affiliate link.
4. Merchant Confirmation
The merchant reviews the transaction. Cashback is subject to validation and may be declined due to returns, cancellations, or merchant policies.
Why Cashback Is Not Guaranteed
Cashback depends on several factors, including:
- Merchant approval and terms
- Browser settings and ad blockers
- Cookie acceptance
- Completed and valid purchases
Because of this, cashback is never guaranteed and may take time to be confirmed.
Cashback vs Discounts and Coupons
- Discounts reduce the price immediately at checkout
- Coupons apply a promotional code
- Cashback is a potential reward that may be confirmed after purchase
In some cases, cashback and coupons can be used together, but this depends on merchant rules.
How Cashback Websites Make Money
Cashback websites may earn commissions from merchants when users click affiliate links and make purchases. This does not increase the cost for shoppers.
Affiliate commissions help cover operating costs and support the continued maintenance of the platform.
Final Thoughts
Cashback can be a useful way to save money when shopping online, but it’s important to understand how it works. Cashback is not instant, not guaranteed, and always subject to merchant approval.
Understanding the process helps users make informed shopping decisions and avoid unrealistic expectations.