They were intended as a broad boost to the economy, but the $150 billion (£77 billion) of tax rebates returned to Americans have succeeded in sparking a squabble among retailers who are competing to cash in on the windfall for consumers.

Washington came up with the financial stimulus, sent to 130 million homes, to inject new life into the ailing economy as Americans try to cope with soaring fuel prices, rising food prices and the plummeting value of their homes. Yet seeing the prospect of a surge in spending, retailers have devised differing schemes to glean as much extra income as they can.

Some are encouraging customers to cash their entire rebate cheque (on average about $800) at their store by offering either additional discounts or bonus cash.

While Wal-Mart, the world’s biggest retailer, has offered its customers the service of cashing their cheque free, it has criticised retailers who are seeking to encourage shoppers to spend all their rebate at one store.

Stephen Quinn, Wal-Mart’s chief marketing officer, said: “Anything that locked in their money at one store is not appropriate. Putting $600 on my gift card greatly enhances the chances that you will spend the money with my store. But we do not want to encourage any behaviour that might be considered irresponsible.”

Some retailers are demanding that shoppers use their windfall in a particular way by offering certain offers. Radio Shack, the electronics retailer, will cash federal cheques on the condition that a purchase is made and that the remainder is put on to a prepaid Mastercard credit card.

Expedia, the online travel company, has launched an advertising campaign entitled: “Give your economic stimulus an economic stimulus – Explore America with your tax rebate and we’ll chip in $200.” Lowe’s, the home improvement store, is advertising: “Update with your Tax Rebate. Get Started with the Enclosed Free Project Starters.”

American high street sales are expected next week to show a sharp fall in spending, but some consumer groups have criticised retailers’ response to the rebate. Jean Ann Fox, of the Consumer Federation of America, said: “A lot of people probably have high cost debt they need to pay off with this money. And if you’ve tied up your stimulus check in a card that can only be used at one store, you can’t do that.”

Last week, Wal-Mart said that there was a “pay-check cycle”, in which shoppers bought at the beginning of the month, when they had just been paid, and stopped spending at the end of the month, because they had run out of money. Wal-Mart said that the trend was far more pronounced than they had experienced in the past.

Pay-day loan agents are also blossoming. Essentially loan sharks, the lenders offer small amounts of money against a borrower’s next pay cheque and typically charge between 390 per cent and 780 per cent on the sum borrowed. Known as “pay-day shops”, there are now more such lenders than McDonald’s restaurants in the United States.

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