Transferwise now accepts credit cards with 0.3% fees = Endless cycle of payment
Nov 2, 2015, 4:42 pm
#1
Original Poster
Join Date: Oct 2004
Posts: 732
Transferwise now accepts credit cards with 0.3% fees = Endless cycle of payment
Transferwise is an online p2p foreign currency conversion system where you can send money to accounts in different countries with hardly any fees, and using close to the mid-market rate. They are built by the same guys who created Skype.
Until recently they did not accept credit cards but now they do.
Fee table:
Now, this means you can theoretically do an endless cycle of payments and transfers, assuming you have a bank accounts in 2 countries which both allow sending. The lowest countries are UK, Denmark, Norway and Sweden with just 0.3% fee for using a card.
Ł10,000 GBP converts to 130,907.97 SEK
CC fee 0.3% = Ł30
13907.97 SEK converts to Ł9,912.84 GBP
0 Fee for using a bank transfer
Total cost = Ł117.16 for Ł10,030 of credit card spend.
Obviously you can lose out our even gain a bit if the daily exchange rate varies by the time you cycle the money back so it's not exactly risk free.
Note that only Visa/MC are accepted so far. This seems like a crazy good deal if you have an old BMI MC though.
One find caution though! Transferwise states:
So it's worth checking to see if this is treated as a cash advance by your specific provider.
Until recently they did not accept credit cards but now they do.
Fee table:
Now, this means you can theoretically do an endless cycle of payments and transfers, assuming you have a bank accounts in 2 countries which both allow sending. The lowest countries are UK, Denmark, Norway and Sweden with just 0.3% fee for using a card.
Ł10,000 GBP converts to 130,907.97 SEK
CC fee 0.3% = Ł30
13907.97 SEK converts to Ł9,912.84 GBP
0 Fee for using a bank transfer
Total cost = Ł117.16 for Ł10,030 of credit card spend.
Obviously you can lose out our even gain a bit if the daily exchange rate varies by the time you cycle the money back so it's not exactly risk free.
Note that only Visa/MC are accepted so far. This seems like a crazy good deal if you have an old BMI MC though.
One find caution though! Transferwise states:
In some cases your bank may treat the credit card payment as a cash withdrawal and charge a fee. It is not possible for us to check on our end whether this will happen, so please check with your card provider if you have any concerns before making the payment.
Last edited by tcook052; Nov 3, 2015 at 9:56 am Reason: remove referral link
Nov 3, 2015, 4:41 am
#6
Original Poster
Join Date: Oct 2004
Posts: 732
I checked how this works and their fees are dependent on the currency chosen. GBP and SEK, for example are 0.5% only. But, this does give you mid-market rates.
Meaning you would be looking at Ł130 for Ł10030 of spend. Note that if you have a card with zero foreign transaction fees, or a card in the second currency you are choosing, you can potentially make this more efficient.
As I said, for anyone with the old BMI MBNA MC that gets 2.5 miles per GBP, this could be amazing, if MBNA don't teat it as a cash advance. I'm sure there are many other possibilities with cards in different countries too.
Unfortunately this won't work for USD cards yet, but hey, finally something that gives Europeans a chance first
Meaning you would be looking at Ł130 for Ł10030 of spend. Note that if you have a card with zero foreign transaction fees, or a card in the second currency you are choosing, you can potentially make this more efficient.
As I said, for anyone with the old BMI MBNA MC that gets 2.5 miles per GBP, this could be amazing, if MBNA don't teat it as a cash advance. I'm sure there are many other possibilities with cards in different countries too.
Unfortunately this won't work for USD cards yet, but hey, finally something that gives Europeans a chance first
Dec 31, 2016, 5:59 am
#10
Join Date: Jan 2011
Posts: 368
Apparently MBNA in the UK classes Transferwise as a cash advance: http://forums.moneysavingexpert.com/....php?t=5282879
Anybody know about Creation?
Anybody know about Creation?
Apr 23, 2017, 2:14 pm
#13
Join Date: Feb 2015
Posts: 910
I recall reading on Reddit you'd get shut down relatively fast if you do repeat transactions from yourself to yourself. I think the person reporting this had US as well as a European based accounts and bills and used US cards to pay for the US-to-European country transfers.
May 3, 2017, 9:24 am
#14
Join Date: May 2014
Location: Great Britain
Programs: Air: QR Silver. BA Silver Emirates, Hotels: CC Gold, IHG Spire AMB, Hilton Diamond.
Posts: 1,487
I recall reading on Reddit you'd get shut down relatively fast if you do repeat transactions from yourself to yourself. I think the person reporting this had US as well as a European based accounts and bills and used US cards to pay for the US-to-European country transfers.
Only about 4 or 5 grand (Ł) to manufacture some spending.
I achieved my goal as it was a short-term fix to a problem and wasn't looking for a long-term opportunity.
