I used to have an account with First Internet Bank of Indiana. Via their website, they allow credit card purchase deposits. First IB charges a 3% fee to cover the VISA merchant fee, and the deposit shows on your credit card as a purchase. Is anyone aware of any other bank that offers this service on a routine basis (not just for the opening deposit)? Thanks!
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You do realize that it doesn't matter what the merchnt codes the trasnaction as right?
This is OBVIOUSLY a cash equivalent and your processor could re-code it if they saw fit too.
Several banks will allow it for opening deposit, but I don't know of any others that would allow that, especially since it seems like an end run around paying interest on a cash equivalent.
pdpyromaster said:You do realize that it doesn't matter what the merchnt codes the trasnaction as right?
That was my initial thought as well. But I am speaking from extensive, direct experience. Numerous different credit cards, on multiple occasions, all allowed the transactions as purchases.
pdpyromaster said:
This is OBVIOUSLY a cash equivalent and your processor could re-code it if they saw fit too.
Several banks will allow it for opening deposit, but I don't know of any others that would allow that, especially since it seems like an end run around paying interest on a cash equivalent.
Perhaps they could re-code, but they never did. And First IB did allow it on a regular basis. I am seeking another bank that does the same.
It does allow you to avoid the higher interest rate typically charged on cash advances. However, you do have to pay the 3% merchant transaction fee, just as a merchant would. So, you are not getting the money for 30 days for nothing. No end runs, just a lower long-term rate, and credit for a purchase if it is a rewards card.
Are you trying to use the a certain 5% CashBack card to net the 2%? 
If so, I'd love to help you, because I've been wodering about that myself.
I take it that FIBI doesn't allow this anymore? Honestly, if you have a business you can use GCO to run the CC sales, or Paypal (Although that's risky, knowing paypal's tendency to arbitrarily hold your money)
I doubt any BIG bank would alow this, but you may be able to find smaller local banks that will let you do this, it seems to me like this would be against the rules for merchants and if not against them at least against the "spirit" of said rules. FWIW, I'd love to help, but I doubt it's going to be something you see often...
BTW, I've done stuff like this too on account opening deposits, but it's really a YMMV and not for the risk averse, as triggering manual account reviews would obviously get you asked a lot of questions, and I assume a mod will wander in here eventually and say something to that effect. As that's what they usually do
They closed my account for using the cc deposit service?! I'm probably going to sue them ... Meanwhile, I was hoping to find another bank offering the same service -- looks to be tough.
inxces said:They closed my account for using the cc deposit service?! I'm probably going to sue them ... Meanwhile, I was hoping to find another bank offering the same service -- looks to be tough.
They closed you account for doing it? How much money were you moving through them?
pdpyromaster said:inxces said:They closed my account for using the cc deposit service?! I'm probably going to sue them ... Meanwhile, I was hoping to find another bank offering the same service -- looks to be tough.
They closed you account for doing it? How much money were you moving through them?
probably a whole lot, abusing the system, you dont really have any recourse here they can and will close an acct for any reason they want, very similar to a CC, they are able to close your acct. and unless they held your days outside of 30 days, unless we are talking a fed freeze(money laundering) which is what this looks very very similar to. have fun man.... get ready to produce some records.
This thread is heading in the wrong direction. Please don't make (more) assumptions and move it even further in the wrong direction.
I did not move money through them. I made occasional deposits from a credit card and then used the funds normally, just as you would use any other funds deposited into a checking account. A great way, for example, to take advantage of a 0% Purchases promo rate. My interest cost of doing business exceeds 10%, so using credit cards often makes sense, but not at 18+% cash rates.
They did have the right to close the account, but I am not suing to re-open. I suffered damages as a direct result of certain actions they took, thus I have cause to sue. I'm not going to get into more details than that, but they undertook a few unusual actions that led to the closure.
So, nobody knows of another bank that allows CC deposits?
How much money are we talking about here? It matters because you need to know what kind of behaivor caused it to get your account closed. As they're may be other people in similar situations.
Also, unless it's a (very) rare occurence you're probably not going to find any banks that will let you do this.
Either banks offer the service or they do not.
OMG its..... the Gov. of NY!
Huh?
Smaty Pig does, but you have to pay the 2.9% fee and I think they only have savings accounts.
http://www.smartypig.com/
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