Ukrainians will receive cashback for purchases of domestic goods: what it means
26 February 2024 18:21
At the presentation of the Made in Ukraine platform, President Volodymyr Zelenskyy said that the government is developing a state cashback programme called Buy Ukrainian, under which Ukrainians will be able to receive compensation for part of the payment for goods and services produced in Ukraine. This was reported by Kommersant Ukrainsky 
with reference to the press service of the President’s Office.
“I am pleased to announce today the launch of our new economic platform, and therefore a new economic policy – the Made in Ukraine policy. For the purchase of certain types of goods and services produced in Ukraine, Ukrainian citizens will be able to receive a refund of part of the funds to a special card,”
– zelensky said.
Cashback for purchases of Ukrainian products: when will it work?
The government has received a corresponding order on the state cashback programme “Buy Ukrainian”, and the programme is currently being developed and should start working this year.
“These are taxes, these are the salaries of our soldiers, these are the capabilities of our state, including defence. The parameters of the Ukrainian cashback are already being prepared: financial and technical,”
– zelenskyy said.
Cashback for the purchase of Ukrainian products: how it will work
Prime Minister Denys Shmyhal said that the practice of consuming Ukrainian products should become part of the everyday culture of every Ukrainian.
“We are not talking about restrictions on foreign goods, which is very important. We are talking about incentives that will help Ukrainian entrepreneurs to occupy their niches in the domestic market and enter foreign markets. We are talking about the economic patriotism of citizens in the context of buying their own goods – goods with the label “Made in Ukraine”,
– said Denys Shmyhal.
The support for domestic producers will be provided through the public procurement mechanism – the list of categories of goods to be purchased from local producers will be expanded.
An additional incentive will be the intensification of the School Bus programme, which will involve the purchase of buses from Ukrainian manufacturers. The budget for the current year also includes UAH 1 billion to compensate for the purchase of Ukrainian-made agricultural machinery, which will help create new jobs and increase tax revenues to the state budget.
In addition, the government plans to adapt existing government programmes to the goals of the Made in Ukraine platform.
What is cashback and how does it work?
Cashback is a system of returning part of the money spent to the buyer. It can be beneficial for both the buyer and the seller. The buyer receives a discount in the form of real money, and the seller attracts new customers or encourages existing ones to make more frequent purchases. Cashback can be provided both for certain types of goods or services and for all purchases in general.
The term comes from the English word “cashback”, which literally means “cash back”. This scheme was invented quite a long time ago: according to Forbes, similar programmes appeared in the United States in the 1980s.
Cashback websites enter into partnership agreements with stores, under which the store pays the website a certain percentage of the purchase made for attracting a new customer. The cashback site, in turn, returns part of this money directly to the buyer. The only condition for this scheme to work is that the buyer must visit the online store not through a direct link, but through an affiliate link posted on the cashback website.
As a rule, the reward is paid to the customer by bank transfer, bank cheque, mobile phone top-up or through payment systems. As a rule, all cashback services set minimum thresholds for the amount of reimbursement or time intervals for reimbursement.
The amount of refunds and the terms of their payment depend on the stores participating in the cashback website’s affiliate programme. It can be 0.5% of the purchase amount, or even 20%. From time to time, all kinds of promotions can be held, during which cashback can be doubled or tripled.
It is important to understand that cashback is not a discount. You pay the full price of a product or service and then get a part of this money back.
How cashback works for payment cards
Many banks offer their customers credit cards with cashback. This means that for every purchase made with this card, you get a certain percentage of money back to your account.
The maximum cashback amount is up to 20%. The amount of accumulated bonuses can be seen in a separate section of the mobile application. When the amount of bonuses is more than 100 UAH, you can withdraw bonuses to your main account and use them as regular money in payments. This is the difference between the cashback service and ordinary loyalty cards. After all, you can spend the funds anywhere, not just in a particular store.
What cashback conditions can also be offered by different banks:
- for purchases and top-ups (1%);
- for card payments on the Internet (5%);
- up to 50% for one of the 6 categories offered per month (categories change monthly);
- 0.5% cashback for purchases paid with a gadget (smartphone or smartwatch) using Google Pay, Apple Pay technologies;
- 5% for taxi rides and transport tickets when paying by card;
- a 0.5% fee refund for replenishing the card through the terminals of another bank.
For debit cards, cashback allows you to earn additional income as a result of a refund. It is a kind of additional discount. And for credit cards, cashback allows you to reduce the amount of interest accrued for using the card.
How popular is cashback in Ukraine?
Despite the fact that cashback is, in fact, real money, and not conditional discount coupons that you may never need, Ukrainians are not yet very active in using this service. But in Europe and the US, cashback has long been very popular and widespread.
In Ukraine, about 5-7 banks are developing their cashback programmes on cards with varying degrees of success. Each bank has its own set of shops, goods and services that you can count on cashback for purchasing. Thus, everyone can choose the most favourable programme based on their lifestyle and preferences, but in any case, you should not forget about the tariffs for other services that you receive with a card of a particular bank, whether it is the possibility of obtaining a credit limit, transferring your funds or other popular services.
