Years ago you could open a Citibank online checking account and fund it with a credit card. I charged as much as $80,000 in initial funding to these accounts. I earned miles, and wrote a check from my new account to pay off my credit card. Plenty of people did this, and after several accounts Citibank would invite them to no longer fund new accounts by credit card.
- Chase card charges to fund new accounts are no longer treated by Citibank as purchases. They’re cash advances.
- Citibank cards have always been treated as cash advances.
- And Citibank does not accept American Express for funding new accounts.
But Doctor of Credit recently pointed out that Barclays charges are coding as purchases. And he verifies that Citi was allowing charges of at least $75,000 when opening an account (limited by your credit line on a card, of course).
I’ve since had a reader email that they were successful doing this, and PointsCentric writes about this as well.
As in the old days, he had to fax in a credit card authorization form. Several days later his charge was processed. (When I would do this it would trigger a fraud alert on my card, I’d have to clear that and get Citi to re-process.)
I’d highly recommend asking your card issuer to set your cash advance limit to zero as a precaution. You don’t want a large charge treated as a cash advance, as you’ll pay interest and won’t earn points.
I’d be curious the experiences others may have, especially with other banks.