Tesco Bank starts to treat pre-paid cards as a cash advance – with a 4% fee
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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.
Want to earn more points from credit cards? – April 2024 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 February 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
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.
British Airways American Express Premium Plus
25,000 Avios and the famous annual 2-4-1 voucher Read our full review
American Express Preferred Rewards Gold
Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review
The Platinum Card from American Express
40,000 bonus points and a huge range of valuable benefits – for a fee Read our full review
Virgin Atlantic Reward+ Mastercard
15,000 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:
SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.
British Airways Accelerating Business American Express
30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review
American Express Business Platinum
40,000 points sign-up bonus and an annual £200 Amex Travel credit Read our full review
American Express Business Gold
20,000 points sign-up bonus and FREE for a year Read our full review
Capital on Tap Business Rewards Visa
Huge 30,000 points bonus until 12th May 2024 Read our full review
For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.
Barclaycard Select Cashback Business Credit Card
1% cashback uncapped* on all your business spending (T&C apply) Read our full review