Weekend Rewind: Using Amazon Payments To Complete Minimum Spend Requirements

Weekend Rewind

Since there are so many new Readers to Frequent Flyer University, instead of writing new content every weekend, I have started to republish old articles from the FFU archive that according to Readers feedback, they have found especially useful.

For the Readers that are new, hopefully you will learn some new tips and tricks from these old articles.

For Readers that may have previously seen the content, consider this a helpful reminder in case you planned on taking advantage of the post but forgot about it.

The reason I choose this particular topic for today’s Weekend Rewind is due to the fact that so many of you got in on the British Airways 100,000 Avios Points offer.

While you get 50,000 Avios after your 1st purchase, to get the other 50,000 Avios, you have to spend $20,000 over 1 year.

If you are a family of 4, that shouldn’t be terribly difficult, but for someone that is my age or doesn’t have any kids / major everyday expenses, that kind of minimum spend can be a stretch.

As you will see below, using Amazon Payments over the span of 1 year, you should be able to spend $12,000 on your British Airways Credit Card at zero cost to you.

Utilizing this strategy, you should be able to cut the actual minimum spend requirement from $20,000 to only $8,000.

How To Meet Minimum Spend Requirements

Minimum spend requirements are the stipulations or “strings attached” that are added on to Credit Cards sign on bonuses.

Typically they sound something like this:

“Spend $X,XXX in X Months, and receive XX,XXX amount of miles”

As long as your complete the required minimum spend on the Credit Card in the amount of time the issuer gives you, you will get the miles.

If you don’t complete the minimum spend requirements, you will not get any miles.

While most minimum spend requirements are in the low thousands ($3,000 or so), this British Airway Card has an extremely high minimum spend due to the fact that they are giving you 100,000 Avios points.

Typically to hit minimum spend requirements you can use the strategy of pre-paying for future expenses such as next year’s insurance or buying grocery and gas gift cards to use later in the year, etc.

While this is effective, $20,000 worth of gift cards and insurance may not suit everyone.

Daraius of Million Miles Secrets has a great list of 40 potential other ways to rack up minimum spend which can be found here.

Ultimately you want to meet the minimum spend requirements by buying things you ACTUALLY need, as opposed to buying junk that you will regret in a few months!

Ideally you want to buy items on your Credit Card and then somehow get the same value back in cash! This can be achieved by buying a friend’s airline ticket on you Card, paying for Dinner, etc and then having your friends pay you back in cash, etc.

Frequent Miler has also recently become the authority on buying items (mostly gift cards) and then figuring out ways to extract the cash value out of them at a minimum cost. I’d highly suggest checking out his blog too because he has some great tips and tricks on how to do this.

Back in the good ole U.S Mint days, you could order thousands of dollars of $1 coins on your Credit Card at cost, they would be delivered to your door for free, and you could just deposit them in your bank.

This was great because you could meet your $3,000 or $5,000 minimum spend without having to really spend any money out of pocket!

You could spend $3,000 and get $3,000 back in $1 coins. To be fair though, it was a pain in the butt to haul $3,000 in coins to the bank every week!

Unfortunately those days are long gone, so now we have to get creative!

Amazon Payments

Currently the most effective tool out there to meet minimum spend requirements is Amazon Payments.

Amazon Payments is essentially a PayPal competitor which allows you to send money between two parties for free.

As of right now, this also includes Credit Cards!

If you are familiar with Credit Cards, you know Visa and MasterCard charge a 3% or so fee to process Credit Card payments. This means Amazon is currently eating these processing costs to build market share, although because Amazon is so large, they might pay a substantially lower fee to process Credit Cards.

I only expect Amazon’s generosity to last for a couple of more months, as for every $1,000 someone transfers, it costs Amazon $30 or so in processing fees.

Not really a good long term business model!

It is for this reason I recommend not going nuts and trying to transfer $5,000 in one month.

YOU WILL GET FLAGGED AND BANNED!

However if you transfer less than $1,000 (which is the monthly Credit Card limit), as I have been doing to pay my Rent since January 2012, you should be fine.

To sign up for Amazon Payments, simply go AmazonPayments.com. If you have an Amazon.com account log in, if you don’t, go ahead and create one.

Once you are logged in or signed-up, it will ask for your Social Security Number, Credit Card, Bank Account, etc so Amazon can make sure you aren’t money laundering.

After you register your Credit Card and Bank Account, you should be ready to send the money.

For the person you are going to send the money to, they will also have to sign up, including adding their Social Security Number, Bank Account, and Credit Card info.

It is for this reason, it is best if the person you are sending the money to is a spouse or trusted friend.

After your account is fully set up, simply go to the Send Money tab, and fill in the following fields.

I actually do use Amazon Payments to pay my Rent, so I put Rent in the box. You can put whatever you want, but I figure Rent is one of the only consistent reasons why you would transfer $1,000 a month, so it makes sense on that level to.

Note: That there is a $1,000 per a month limit on Credit Cards.

Also from my experience, it is better to have your other Person’s account set up and verified before sending the your money, or the payment might not go through.

After you hit continue, it will ask you how to want to fund the transfer.

Once you hit continue, it will take you to the Confirmation Page.

After you hit send on the Confirmation Page, the person you are sending the money to will get an email.

The first time I tried to pay my landlord via this method, the payment got flagged by Chase so I had to call Chase and tell them to manually override it and then I had to re-run the payment. However, once Chase knew about it, they never flagged it again and I haven’t had any issues.

Once your other Person logs into their Amazon Payments account, they can go collect the money and transfer it to their bank account. Once it is in their bank account, they can either write you a check or give you cash, or you can electronically transfer it.

Although I hate Chase Bank (not Chase Credit Cards though) for their ridiculous checking fees, their new person to person Quick Pay technology is exceptionally useful for transferring money between 2 people’s Chase checking accounts.

If your friend has Chase, they can transfer the Amazon Payment funds into their Chase checking account, and then do an electronic Quick Pay transfer to your account.

All in all, I have been paying my $750 rent to my landlord for the last 4 months, and a friend has been transferring me $1,000 a month to meet his minimum spend requirement and we have not had any problems.

When my friend transfers the money to me via Amazon Payments, I simply move that money to Chase, and then transfer it from Chase back to his Chase checking account.

Transfer Strategies

If you alone have to meet the spending requirement on the British Airways Card, and you are solely transferring to your friend or spouse, then you should not have any issues.

However if you and your friend or spouse both have the British Airway Card and both need to meet the spending requirements, then you might run into issues if you try to transfer money back and forth to one another.

The vital thing in the equation that I talked about above is that we ARE NOT transferring money back and forth between each other on Amazon Payments!

I am paying my Landlord, and then my Friend is paying me. The 2 People and accounts are not connected in anyway.

If I were to instead send my Friend $1,000 for “rent” (via Amazon Payments) and then he sent me $1,000 for “rent” (via Amazon Payments) every month, we would be asking to get flagged because Amazon would figure out that we are just doing this to get miles and not legitimately using the service for its intended use.

If you get flagged by Amazon, you are pretty much out of the game for good because your Amazon Payments account is tied to your Social Security Number. So unless you have another Social Security Number, it is best to not get greedy and avoid getting flagged at all costs.

Therefore do not try any circle strategies in which Person A transfers to Person B, and then Person B transfers back to Person A.

Additionally, I’d even stay away from doing any triangle strategies in which Person A transfers to Person B, Person B transfers to Person C, and Person C transfers back to Person A.

I’m sure Amazon has sophisticated fraud and anti-money laundering systems and will connect the dots if you do the same transfer pattern every month!

Therefore the best bet is the straight line strategy in which Person A transfers to Person B via Amazon Payments, and then Person B uses Chase or any bank to route the money back to Person A.

Yes Person B won’t get any miles for transferring the money back to Person A via Chase, Check or Cash, but you also won’t get flagged!

Hopefully all of that makes sense!

If you have any questions or have any better ideas on how to meet minimum spend requirements, feel free to email me at FrequentFlyerUniveristy@gmail.com or leave a comment.

Ethics

Before anyone comments about how this is unethical, I will point out that when I actually do pay my monthly rent via Amazon Payments, that Amazon is still loosing money even though it is a legitimate transaction.

Amazon could easily charge people to use Credit Cards, but they are purposely eating the transaction fee in an attempt to cut into Paypal’s market share.

Their strategy is obviously working since this post prominently promotes Amazon Payments and not Paypal!

Once Amazon Payments becomes unprofitable for them, they will stop allowing people to use Credit Cards. Plain and simple.

Until then we might as well utilize Amazon’s generosity and help them build their service!

-Parag