Chase coding Amex gift card purchases as cash advances

This is one of my rare anti-deals…

Many readers have been reporting that when they’ve recently bought Amex gift cards online from American Express, Chase has coded these purchases as cash advances.  So, unless or until things change, I strongly advise you not to use a Chase card to buy Amex gift cards from American Express online.  There should be no such problem with buying Amex gift cards (or any other gift cards) in stores.  The same has been true (for a long time) with Citibank credit cards, but this is new to Chase.

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Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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Comments

  1. I bought a 3,000.00 Amex gift card with my Chase Sapphire Preferred card. It was coded as a cash advance and I was also charged a 150.00 transaction fee. The Chase customer service rep said that it was Amex that coded it as a cash advance. I will call Amex to confirm.

    • Talked to Chase again today. They said they code it the way Amex tells them to. So we did a conference call with Amex. The Amex guy is still saying that it should have gone through as a purchase and not a cash advance. He said that their systems were down for at least an hour so he could not look into any further. He said he would get back to me in 3 to 5 business days.

    • Had another conference call with chase and amex today. Amex is now saying that they have gotten hundreds of calls and that there is a coding issue. They are currently working on a resolution but would not give me a timeline. Amex said that they do want it to be coded as a purchase not a cash advance.

    • Chase called last night and they are going to reverse the transaction fee because they said I was a good customer. That was nice of them but not really the answer I wanted to hear. I am still waiting to hear back from Amex to verify that future transactions will be coded as purchases not cash advances.

  2. A further datapoint for your earlier post: I purchased $5k in one transaction (one $3k card, one $2k card) with a Starwood Business Amex card on Thursday (10/17). I got an email shortly thereafter indicating that the order was approved, as well as an email from BigCrumbs that the cash back had been awarded. The transaction still shows as “processing” on the AMEX website, but the authorization charge is no longer showing up on the Amex account. I fear they’ve cancelled the order and just haven’t notified me yet. Oh well – I’d rather have my order cancelled than be charged a cash advance fee if AMEX cards experience a similar issue to Chase’s treatment of these transaction.

    • I received the cards in the mail yesterday. AMEX website still shows the order as processing and the charge has disappeared from pending and posted transactions. Credit limit still correctly shows the lesser amount that should be available based on my $5k purchase. Hmm.

  3. What’s strange about this is that Chase themselves offered free gift cards earlier in the year, and coded them as regular transactions, but now they’re coding Amex gift card purchases as a cash advances. A possible solution: would it be possible to call Chase and ask them to set the cash advance limit to 0? Maybe buying Amex gift cards would work then.

  4. My charge hasn’t posted yet but on my SPG card the temporary authorization shows “AMEX GIFTING PRODUCTS” which is different than before. Perhaps that has something to do with it, although I suspect Chase is doing something on their end.

  5. I’ll tell you what’s weird, I bought a $1.5k card on Wednesday, got the approved email Wednesday, BigCrumbs posted the cash back Thurs/Fri, got the card today. Saw all this and checked my Chase account…nothing. No charge for $1.5k, no charge for fees, no cash advance fee. Nothing.

  6. I’m glad my transaction didn’t go through because of writing the address not exactly as the statement, and I was banned for 14 days
    I was planning to use my SPG and Amex gold Biz after the14 day ban. Any report on successful or unsuccessful purchase using Amex CC?

  7. I used a Chase UAL Club card for $3000 and just saw a $90 transaction fee on my account. I have been a loyal Chase customer for years and run thousands in legitimate transactions as well as thousand in Mfg spend (though pretty well hidden and spread out). Has anyone had any success disputing the charge on the basis that no rational consumer would make a purchase like this if they knew this new policy to be in place (e.g. chase didn’t charge a fee on their own GC product).

  8. Similar to above, I was hit with $570 fees for CA. Called and was told all gift cards are treated as CA. Looked at prior statements where GC were not treated as CA. Called back and was told Amex changed and coded it as CA. Called Amex and they denied. Called Chase again and was told it was Amex and they couldn’t do anything about it.

  9. An Amex supervisor claimed to me that they do not control how Chase views the gift card purchase, nor how the purchase is coded. Regardless of whether this is true or not (and I told him it wasn’t), he wasn’t budging on the issue.

  10. same situation with mine today.
    First time last September is fine when I purchase Amex gift card with chase credit card.
    But today, it was corded as cash advanced.
    it is very hard to purchase the Amex card with anther credit card.
    Amex have declined many time any some reason with non amex credit customer.The representatives in customer service they also don’t know why and can’t explain.
    Amex cards is terrible.There is no gift card company I can purchase like Amex gift card?

  11. I got the same thing… “cash advance” stupidity from amex and their support was equally bad. Chase gave up as well. Final resolution: there is a possibility to cancel the gift card altogether by calling american express… however, that can be done only if following is done:
    1. gift card cannot be used for any amount.
    2. you have to swipe the card at any terminal for $0.. i was told that it will make the funds available on the card failing which amex reps cannot cancel the card. I plan to go to local safeway in self checkout and cancel the transaction after swiping the card.

    This is complete stupidity on part of amex and their phone service which has been outsourced doesn’t help much either.

  12. Attempted purchase of Amex GCs on November 12 and 14 declined by US Bank (Club Carlson Business card), as I have my cash advance limit set to zero at US Bank. Customer service confirms that “Amex Gifting Products” was coding these attempted purchases as “cash advances”. Amex sucks.

  13. Just received the new Chase BA Visa. Tried small test with both Amex Gift Card and Visa Gift Card for $25 each. They were processed as purchases (not cash advances). This suggests that Amex is not coding these as CA but Chase may be reviewing large Amex GC purchases and recoding. Will try another test for larger amount after setting CA limit to zero.

  14. I’ve noticed that in the past week or so, Amex gc purchases are showing up differently even within my Amex statements so my guess is that Amex has changed the way they code these and probably won’t incur cash advance fees anymore. Can anyone else confirm?

  15. For me it was with discover . Attempted purchase of Amex GC for $1000, the transaction was declined and did one for $700 it went thru…but wait it went thru as CA in discover ;
    Called Discover they said AMEX coded it as CA…,Called AMEX they say they can’t do much about it other than refunding the transaction

    is Dispute transaction an option ???

  16. I recently ordered $1500 of Amex gift cards (one for $1000, another for $500) using a Chase Southwest card, and the purchase went through as a cash advance. I did end up disputing the charge, which caused Chase to issue a temporary credit and refund the cash advance fee. Amex ended up cancelling the cards and of couse I did not earn points on the purchase, but this appeared to be the only option as Amex would not refund the cards otherwise or change the way the transaction was coded.

  17. I just made a test purchase of $150 in AmEx gift cards with my Discover Card. I called Discover right away and was told the purchase was coded as a Cash Advance and subject to the CA fee as well as the higher APR.

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