Use Paypal to earn miles ?
 

I just thought about the following:

You open one regular paypal account
http://www.paypal.com/cgi-bin/webscr...n/fees-outside

and one merchant account, then you sign up for the preferred program with the debit card that you can use to withdraw funds using ATMs.

fees seem to be moderate:
http://www.paypal.com/cgi-bin/webscr...en/ppp-outside

If you then transfer USD 100000 using e.g. your Mileage Plus Visa card to your merchant account, you get the miles, pay the o.7% fee for receiving the funds, and withdraw the money from your merchant account (is there an additional fee ?).
Now you immediately pay it back into the account that will be charged the 100K$ Visa bill!

100K miles for 700 USD, not bad.
Is this feasible, has anyone tried it ?
Of course, if you make the payment with your AA affinity credit card, you can get lifetime Gold and Plat status really quick.

Probably one cannot charge 100K on a Mileage Plus Visa card because of the credit limit but you can use an Amex Centurion card for sure and then you transfer the 100 K MR points to a program of your choice.

Opinions are welcome as usual.
Thank you!

No, it's not feasible.

Even setting aside that PayPal is not going to let you transfer money between two accounts you own like that, first you have to get a true PayPal merchant account with 2.2% fees. Assuming you can do that, in order to be only charged fees of .7% (It's actually .733% because the 1.5% rebate is applied after the 2.2% fee) you need to use all of the money by charging it to your PayPal Debit card.

Somewhere it says you can withdraw money from ATMs using your Paypal debit card, but for sure not 100K at once. One could have a paypal account and transfer the money to a merchant account belonging to a friend whom you would pay the fee back plus a munificient tip!

http://www.flyertalk.com/forum/frown.gif
- it was not more than a quickly vanishing idea

You can, but you don't get a 1.5% rebate on ATM withdrawls. There's also additional fees for ATM withdrawls you'd need to figure.

Finally, I wouldn't mess around with large sums of money like that ... although it should be perfectly legal, it could draw the wrong kind of attention.

I second that, paypal is known to lock accounts with suspicious activity and it could be very hard to get any of your money back at all... that would really suck.

I have a Paypal merchant account with their debit card and trust me - I would have earneed miles a long time ago if it worked like that.

As has already been mentioned - your fees are actually about 2.2% - only you get 1.5% back for every non-pin charge to your paypal card. So if you are willing to risk getting your account locked yes you could earn lots of miles - but at a much higher cost than you mentioned above.

The Paypal card does work very well as a caskback card though - you can transfer money into your paypal account from your banks and spend everything on your paypal card - getting 1.5% back on everything. The biggest disadvantage is the lower level of protection offered by debit cards verses credit cards.

I also have experienced how easy it is to get your paypal account locked - however I must say their CS has improved dramatically. It recently took them a few hours to get my account unlocked once I had faxed all the requested documents - and this was on a Saturday. A couple years ago I spent more than a week and many hours of waiting on hold to accomplish the same. Hold time has decreased also.

Anyhow - Paypal is not the least expensive way to get miles!

And that 2.2 percent actually goes up to 2.9 percent or so if you are running less than $1000/month into your account.

At that price, as others have mentioned it is just as worthwhile to buy the miles from the airline directly.

Mike

Okay, so it may have some risks, but I applaud flamboyant 1 for getting a little creative.

Since Ebay bought Paypal I think they have to give better service. I don't think Ebay will stand for Paypal making them look bad.

The folks who created the http://www.paypalsucks.com website might beg to differ. The new 26,000-word user agreement seems to be one of their bigger complaints.

I know there are lots of "horror" stories, but I have used Paypal to send around 100 payments and have never had an issue.

I would like to see the stats on how many transactions they process a day vs. the number of complaints. I don't believe paypal was started by some huge corporation that had a ton of experience dealing with customer issues. I also don't believe the founders ever imagined it would grow as fast as it did.

But I think I digress.

lintemut,

I agree with you, also never had a problem but hey, I always paid and never received a payment. Mileage Runs are a better deal - I know there is an InsideFlyer promo here and there...

http://www.flyertalk.com/forum/frown.gif I just thought for a brief moment to get 100K miles really fast for 700 or even 2200 USD. http://www.flyertalk.com/forum/frown.gif

Anyway thanks for your opinions!

I've complained over and over to Paypal about how deceptive the language regarding their fees for accepting credit cards. For lwo-volume customers, it's 2.9%. They quote lower rates assuming you're going to make an EQUAL amount of purchases as you do sales, and charge all your purchases on their Mastercard check card to glean the rebate.

It's like saying come eat at our restaurant for 5% of the menu price, not mentioning that you have to work a part-time job in the kitchen to pay for the savings.

Having said that, there are times when you absolutely HAVE to have a few extra miles for elite status or whatever and might be willing to pay 3%. It's just there are other ways to buy miles a lot cheaper.

Traveler

[This message has been edited by Travelergcp (edited 09-18-2003).]

I have recieved hundreds of payments (including large ones) and have never really had a problem - my account was locked twice because they were unable to contact me when they tried to. I forgot to update my address the first time...and was travelling internationally the second time. I find it reasonable they expect sellers to keep their contact information up to date. As I mentioned above - the first time my account was locked they had horrible customer service but judging from my more recent experience their customer service has gotten far better since ebay bought them.

When I mentioned "attracting the wrong kind of attention", I actually meant from various government authorities. Transferring $100,000 by PayPal to a different account then getting the money back sure sounds a lot like money laundering ... even if that's not why you're doing it, I wouldn't want to be explaining it to someone in an interrogation room.

The risk of PayPal locking your account is certainly another very real risk.

Seems like paypal is not a laundromat yielding miles http://www.flyertalk.com/forum/mad.gif