THE notion of getting money for nothing may sound too good to be true, but log on to one of the growing number of cashback websites and you could find yourself quids in.

“Free money” is offered by quidco.com , TopCashBack.co.uk , Rpoints.com , Freefivers.co.uk and Greasy-Palm.co.uk. All you have to do is register with the site and use it as a portal when shopping online, or signing up to insurance and banking products. Once you decide to make a purchase, you click on the retailer’s logo and are taken to the relevant website.

The site tracks this, earning you a percentage of your purchase back in points or pounds. This is paid later in cash or vouchers.

“In the same way as a supermarket allows its customers to earn loyalty points, we allow members to earn cash on all of their internet shopping,” says Oliver Ragg, director of TopCashBack.

All the websites get commission for referring shoppers to retailers such as Boots, Dell, Currys, Tesco, Prudential and Lloyds TSB. Martin Lewis, of MoneySavingExpert.com, the consumer information site, says: “Cashback sites are actually advertising sites. They list product providers and retailers and, when you click through, they get paid for ‘providing leads’. When you’re logged in, the revenue raised from your click is attributed to you, so the site can pay you some or all of the money it receives.”

The amount of cash can vary, and may be a percentage of your total purchase or a flat fee. According to MoneySavingExpert, typical payments range from 3 per cent of the product’s cost at Currys and Tesco Direct, to 9 per cent at HMV, rising to £70 if you take out a home insurance policy with Nationwide Building Society.

Each site operates differently: Quidco, for example, charges a £5 annual fee, while TopCashBack is free. Both will pay out by either Pay-pal, the online cash system, or bank transfer. TopCashBack will also pay out by cheque. Elsewhere, Rpoints will pay £5 if you recommend a friend, rising to £7 with GreasyPalm.

Mr Ragg says that shoppers can earn several hundred pounds a year, while Mr Lewis says that some consumers claim to get as much as £1,000.

David Kuo, of fool.co.uk, the price comparison service, says that while the websites are becoming increasingly popular, consumers should be cautious. “With some of the sites, you have to reach a certain threshold – £25, say – before you can get your money back. You may also get vouchers that can only be used to make purchases on particular websites.

“The retailers are trying to build up a sense of loyalty between you and the cashback firm so that you will trust the site and keep going back. It’s important you do your own research to find the right product before finding out if you can get cash back.”

CASE STUDY

BIG SAVINGS AND MONEY BACK

LYNN FURBER, 38, from Uttoxeter, Staffordshire, has saved £632 since registering with the cashback site, TopCashBack.co.uk , 18 months ago. “I made the biggest savings when buying my home and car insurance,” says Lynn, a nurse researcher. “My renewal quote for my car insurance was £350, but when I used the site, I got a much lower quote of £220 from Privilege – and then went on to get £60 cashback too.”

She says that you must go into the websites with an open mind, and have faith that the money will track through. “But to date, I’ve had only one problem and that was the fault of the retailer, and not the website. You still need to shop around before you buy, but by using the website I know I’m getting a good deal – and the money is usually in my account about three or four months after I’ve made the purchase.”