Whenever you open a new checking account, you need to fund it with an initial opening deposit. A lot of banks allow you to use a credit card for this and you can fund anywhere from $100 to $2,000 depending on the bank. This obviously isn’t a scale-able manufactured spending technique as you’ll need to make sure you complete certain requirements to avoid monthly fees and typically cannot close your account for a period of six months unless you pay an early account termination fee but it is a great way to meet minimum spend requirements on credit card offers.
This method first became popular when you could fund your Citibank checking account with an unlimited amount via credit card. It regained popularity when Oceanside Christopher Catholic Union allowed credit card funding of up to $10,000, which was quickly shut down. Due to the much smaller funding limits banks have now set this looks to be much more sustainable. Especially considering they sometimes give bank account signing bonuses of up to $600 which makes the credit card processing fees they need to pay look measly in comparison).
If you plan on using this method, you should ring your card issuer and request that they set your cash advance limit to $0. Most banks will not charge a cash advance fee for bank account funding (Citi almost always will), but it’s better to be safe than sorry. Most banks will do a chex systems inquiry when you open a bank account, which doesn’t affect your credit score. Some banks will do a hard credit pull, this is usually when they offer overdraft protection, this will affect your credit score.
Below we’ve listed 12 banks/credit unions that allow credit card funding for the initial deposit, totaling $8,300 in possible manufactured spend.
- BMO Harris^ up to $1,000
- Chase^ up to $500 , Chase credit cards not eligible
- First Niagara^ bank up to $1,000, Visa or Mastercard only
- Oceanside Christopher Catholic Union up to $100
- PNC^ up to $2,000, Visa or Mastercard only
- Satander^ up to $500
- Wells Fargo up to $500
State Specific Banks
- Bank of Maine^ [ME, MA & NH] up to $500
- Citizens bank [Enter zip to find out] up to $1,000
- First Citizens*^ [AZ, CA, CO, DC, FL, GA, KS, MD, MS, NM, NC, OK, OR, SC, TN, TX, VA, VA, WA, WV] bank up to $1,000
- KeyBank^ [AK, CO, ID, IN, ME, MI, NY, OH, OR, UT, VT, or WA] up to $100
- NorthWest savings bank^ [PA, NY, MD, OH] up to $100
* indicates that it’s a hard credit pull to open a checking account with this bank
^ indicates that this account currently has a sign up bonus on it, in these cases we’ve linked directly to the sign up bonus offer rather than the bank’s homepage.
This list will be updated whenever we receive new information on which bank accounts can be funded via credit card. If you know any, then share with us in the comments.
This guest post was contributed by William Charles who blogs at http://www.doctorofcredit.com. He regularly posts about bank account bonuses and other consumer credit topics such as credit scores & consumer credit laws (such as the new SECURE act which would allow consumers free access to their credit scores). On Friday he offered $25 to whoever guessed what this manufactured spending technique was first (commenter ‘aegt’ is the winner! Coincidentally, also the first post). He’ll be giving out $25 to somebody who tweets out or shares this blog post on Facebook at random.