I receive compensation for many links on this blog. You don’t have to use these links, but I am grateful to you if you do. American Express, Citibank, Chase, Capital One and other banks are advertising partners of this site. Any opinions expressed in this post are my own, and have not been reviewed, approved, or endorsed by my advertising partners. I do not write about all credit cards that are available -- instead focusing on miles, points, and cash back (and currencies that can be converted into the same).
Plastiq is a great way to turn bills you have to pay (even rent or mortgage) into miles, albeit for a fee. Right now there’s a promotion with discount rates for paying rent or mortgage with a MasterCard or American Express.
This week there was a bit of a stir when bill payment service Plastiq — which charges your credit card and mails checks for you — started warning customers that Visa may classify charges with them as a cash advance.
I spoke to Plastiq to find out what was going on.
- Anyone that has been paid via Plastiq before is fine to pay with a Visa.
- Plastiq can set up a relationship with anyone new you want to pay, and then it won’t process as a cash advance (just email them).
- It’s not all Visa cards that are coding as a cash advance, it’s actually a limited problem they’re working to resolve, but they’ve giving a warning broadly ‘just in case’.
- If you don’t get the warning you can be confident your situation won’t involve a cash advance (for instance because they’ve paid the recipient before, etc).
I’m not certain which issuer is the prime culprit here, or how they’re able to overcome the issue by having an established relationship paying someone but that seems to be the case.
If you do want to pay someone new that Plastiq hasn’t paid before — and you don’t want to get the recipient to set up a relationship with Plastiq first — just pay them first with a MasterCard or American Express, even a small amount, that gives Plastiq a sufficient relationship with that recipient. And then you’ll be able to pay with Visa subsequently and not risk a cash advance.