Using Statement Credit to buy Gift Cards?

[LosAngelesTraveler]

Hey everyone!

I have a couple of "cash back" credit cards that only offer redemption through statement credit. I don't use these cards anymore so I wanted to just buy an Amazon gift card with the statement credit. That way it's also easier to redeem odd amounts ($127.84 in my case) as if I make a purchase above the amount I would still generate more cash back - but I want to bring that rewards balance to zero.

Any data points? Can I get my accounts shut down for doing this?

The cards are:

- American Express Blue Cash Preferred

- HSBC Advance Mastercard (this one offers direct deposit for redemption but offers less points)

But I would love to hear data points on any other banks as I hold cashback cards with multiple issuers.

Thank you all!

[TSlop]

I haven't had any issues reloading my gift card balance (yet). I recently reloaded $50 to my balance using my Amex HH card when there was an Amex Offer for Amazon. I also load $1 every few months to keep my PNC card active. The only thing I haven't tried is loading up $1,500 to satisfy a 5% rotator when the category is Amazon, but I have no need to with the Amazon card.

[pinkandgrey]

I'm not sure what makes you think you'd get in trouble for doing this....

Buying a gift card and then redeeming your cash back sounds like a perfectly normal and expected behavior to me! 

[LosAngelesTraveler]

Well there's this thing called Manufactured Spending - people will buy giftcards to churn signup bonuses - and Amex has been known for shutting down accounts and taking signup bonuses back for that. This is not a signup bonus yet my fear would be if it's seen by Amex (or HSBC) as a rewards system abuse.

[Remedios]

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@LosAngelesTraveler wrote:

Well there's this thing called Manufactured Spending - people will buy giftcards to churn signup bonuses - and Amex has been known for shutting down accounts and taking signup bonuses back for that. This is not a signup bonus yet my fear would be if it's seen by Amex (or HSBC) as a rewards system abuse.

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MS is a bit more complicated than what you're describing, and what you're planning on doing with your cashback isn't MS. 

With that said, let's leave MS out of the conversation, especially when it's not applicable. 

[Anonymous]

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@LosAngelesTraveler wrote:

Hey everyone!

I have a couple of "cash back" credit cards that only offer redemption through statement credit. I don't use these cards anymore so I wanted to just buy an Amazon gift card with the statement credit. That way it's also easier to redeem odd amounts ($127.84 in my case) as if I make a purchase above the amount I would still generate more cash back - but I want to bring that rewards balance to zero.

Any data points? Can I get my accounts shut down for doing this?

The cards are:

- American Express Blue Cash Preferred

- HSBC Advance Mastercard (this one offers direct deposit for redemption but offers less points)

But I would love to hear data points on any other banks as I hold cashback cards with multiple issuers.

Thank you all!

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Ignoring the main question (and I agree with @Remedios on that), if it's statement credit and you buy $127.84 gift card, that is still going to generate a little extra reward (a minimum of $1.27 depending where you buy it!).   If you can redeem DIRECTLY for gift cards, that's different, but a purchase with statement credit is still a purchase.

[NRB525]

Is the $127.xx on one card, or there's more specific amounts to each card. 

If it were me I guess I'd just buy regular groceries with each card, watch that the minimum payment is made ( the minimum payment seems to be required in the comments from others who tried to redeem all cash back as statement credit) , and enjoy the redemption. It doesn't seem like a large amount to try to shift it to another gift card and have to take more specific steps to redeem. 

Yes, it's not ideal for earnings redemption, but you're talking about something less than $5 delta of any possible earnings as you try to close out two cards completely.  Value of your time and all that. 

[Otto77]

For the Amex at least, you can easily request a check for the negative balance on your card after using the statement credit. You can request it online through the "dispute" process (I wouldn't call it a "dispute" but this is what Amex says to do).

Account Services > Disputes > Open a Payment Dispute > I have a credit balance on my account

[Anonymous]

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@Otto77 wrote:

For the Amex at least, you can easily request a check for the negative balance on your card after using the statement credit. You can request it online through the "dispute" process (I wouldn't call it a "dispute" but this is what Amex says to do).

Account Services > Disputes > Open a Payment Dispute > I have a credit balance on my account

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Good point!   And with most/all cards, after a period of time (maybe max of 60 days) they will return a credit balance to you without asking