Tesco Bank starts to treat pre-paid cards as a cash advance – with a 4% fee

Since the law changed in January to ban credit card acceptance fees, there has been a interesting miles earning niche available.

Some of the pre-loaded travel money cards, such as Revolut (we reviewed Revolut here, our special offer saves you the £5 fee), have been treated by some credit card companies as a purchase.  This means that you earn miles or points when you load up your Revolut, Monzo etc debit card.

There is no list of which credit cards treat Revolut etc as a cash advance and which treat it as a purchase – you need to try out the various cards you own.

Tesco Bank has now decided to take action.

From 1st June, Tesco credit cards will increase their cash advance fee from 3.0% to 3.99%.  More importantly, it will now treat payments to prepaid or virtual cards, such as Revolut, as a cash advance.

For clarity, this does not impact Curve.  If you have linked Curve to your Tesco credit card you may have received this letter.  This is because, for two days earlier this year, Curve transactions were incorrectly coded by Mastercard.  If you used Curve during those two days then Tesco thinks – incorrectly – you were loading a prepaid card.

Tesco also has other targets in its sight.  Wire or international money transfers, repayments of loans or mortgages, purchases of foreign currency except in Tesco stores, investments, share trading and spread betting payments will be treated as cash advances.  (I seriously doubt that any mortgage lender was actually accepting a Tesco credit card as payment, but who knows?!)

I get a feeling that, by the end of the year, it will no longer be possible to use any UK credit for a fee-free top-up of a prepaid debit card.

PS. If you are not a regular Head for Points visitor, why not sign up for our FREE weekly or daily newsletters? They are full of the latest Avios, airline, hotel and credit card points news and will help you travel better. To join our 65,000 free subscribers, click the button below or visit this page of the site to find out more. Thank you.

Want to earn more points from credit cards? – May 2025 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

In 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

Barclaycard Avios Plus Mastercard

Get 25,000 Avios for signing up and an upgrade voucher at £10,000 Read our full review

Barclaycard Avios Mastercard

Get 5,000 Avios for signing up and an upgrade voucher at £20,000 Read our full review

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

SPECIAL OFFER: Until 27th May 2025, the sign-up bonus on the ‘free for a year’ American Express Preferred Rewards Gold card is increased from 20,000 Membership Rewards points to 30,000 points. Points convert 1:1 into Avios (30,000 Avios!) and many other programmes. Some people may see even higher personalised offers. Click here to apply.

SPECIAL OFFER: Until 27th May 2025, the sign-up bonus on American Express Platinum is increased from 50,000 Membership Rewards points to a huge 80,000 points. Points convert 1:1 into Avios (80,000 Avios!) and many other programmes. Some people may see even higher personalised offers. Click here to apply.

American Express Preferred Rewards Gold Credit Card

Your best beginner’s card – 30,000 points, FREE for a year & four airport lounge passes Read our full review

British Airways American Express Premium Plus Card

30,000 Avios and the famous annual Companion Voucher voucher Read our full review

The Platinum Card from American Express

80,000 bonus points and great travel benefits – for a large fee Read our full review

Virgin Atlantic Reward+ Mastercard

18,000 bonus points and 1.5 points for every £1 you spend Read our full review

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

The American Express Business Platinum Card

50,000 points when you sign-up and an annual £200 Amex Travel credit Read our full review

The American Express Business Gold Card

20,000 points sign-up bonus and FREE for a year Read our full review

Capital on Tap Pro Visa

10,500 points (=10,500 Avios) plus good benefits Read our full review

Capital on Tap Visa

NO annual fee, NO FX fees and points worth 1 Avios per £1 Read our full review

British Airways American Express Accelerating Business Card

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review