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Having 2 credit cards, one of which is pre-paid, can someone keep topping up the pre-paid card with the other on a monthly basis therefore earning points?

I am asking because in this way you can theoretically always borrow money with basically negative interest (earned in points) while normally, credit card companies would charge you interest for a similar goal.

The issuing country of the cards is Germany.

Added information from comments:

In the example related to the question there is a 0.5% fee to charge and a 0.5% cashback...although I am not sure (In that way yes you would not "earn" but you would have baiscally 0% interest). I had a card in the past which would treat a top-up transaction like a purchase therefore you would not have any fees (you would instead gain cashback points)....The main point here is to determine if this is legal / permitted. Even if you have fees, in some cases they would be less expensive than normal credit p.a. interest rates (It is common in Germany to see from 10 to 20% per year interest).

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    Is there not a transfer fee to move money from the credit card to the prepaid card? In the US that's considered a cash advance or balance transfer and typically has minimum fees.
    – D Stanley
    Jun 9 '20 at 13:55
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    Read your credit card agreement carefully. Usually, cash advances earn no points (points are awarded for purchases only) and are charged interest from the day of the advance, that is, there is no "grace period" where interest is charged only if the statement balance is not paid in full by the due date. Jun 9 '20 at 14:19
  • In the example related to the question there is a 0.5% fee to charge and a 0.5% cashback...although I am not sure (In that way yes you would not "earn" but you would have baiscally 0% interest). I had a card in the past which would treat a top-up transaction like a purchase therefore you would not have any fees (you would instead gain cashback points)....The main point here is to determine if this is legal / permitted. Even if you have fees, in some cases they would be less expensive than normal credit p.a. interest rates (It is common in Germany to see from 10 to 20% per year interest).
    – MintChi
    Jun 9 '20 at 14:24
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    Your question about "legality" is perhaps muddling the issue and making it off-topic. In many western countries (I'm assuming Germany is one of them) everything is "legal" unless there's a law (or legal precedence) explicitly making it illegal. I would hope if something like this were illegal you'd get warnings from one or both companies, but I don't see why it would be illegal if you're using both cards appropriately according to the cardholder agreement. The question of whether it's financially viable is still open in my mind.
    – D Stanley
    Jun 9 '20 at 15:33
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    Before asking whether it's legal (which is going to depend on where you live), I'd ask whether it's even possible, and if possible, whether it doesn't incur a balance transfer fee.
    – jamesqf
    Jun 10 '20 at 4:24
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  • I don't see any illegal

  • It may or may not work.

    • If it works, that may be intended behaviour by the bank: I have a "prepaid-ish" credit card, i.e. the card has a credit line, but I can also put money onto that card (leading to more money being available than the credit line). For any such positive money on the card I used to get interest at a somewhat higher rate than the interest I got on the corresponding checking account (Girokonto). (Of course, now all those interest rates are zero)

      I'm sure the bank did their homework and found that they earn more from people that have more money on their credit card, and the same applies for cashback programs.

    • If I understand the proposal correctly, you'd transfer the full credit line of card A to pre-paid card B at the first of A's month, have it earn points or interest there, and transfer it back to A before the end of the month, so you don't run into paying interest there.

      The first thing to notice is that this way, you have an intermittent credit only.

      Secondly, cashback and similar I've encountered so far would have the fees subtracted immediately while cashback or fee reimbursement happend much later.
      You'd thus need a bit of additional money that covers the fees for this delay, otherwise, the high interest rates for the credit interest kick in and will negate any of your point earning work within short time. The bank may just be waiting for this to happen...

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