Years ago it used to be possible to open Citibank checking accounts and fund the initial deposit via credit card. The charge would post as a purchase and not a cash advance (as long as you didn’t use a Citibank credit card, ha!). And there was no limit to the deposit other than your credit limit.

At the same I funded a new Citibank account with my United Visa with an initial deposit of $80,000. Three times. Then they told me they didn’t want me doing that anymore. 🙂

Lots of smaller banks still let you make the initial funding of a bank account that you open online using a credit card. And much of the time those charges will post as purchases, meaning they earn miles, rather than cash advances (which not only don’t earn miles but cost interest — credit card deposits with Suntrust code as cash advances).

Most banks will limit these deposits to fairly small amounts, like $500 or $1000, and may not be worth doing. I don’t blame them because they’re paying credit card interchange fees to do this.

But some have higher limits, and some let you open more than one account this way.

I believe in sharing deals. But I don’t generally write about small credit unions that allow funding via credit card because those small banks will notice the increased volume, it’s a real cost to them, and I genuinely expect exposure of the opportunity to lead to a change in policy pretty quickly.

Deals that are going to die anyway quickly though I’m happy to pass along to folks who want to get in right away. And here’s one such instance.

There’s a thread exploding now on Flyertalk about the Catholic Credit Union which allows you to open an account online and fund it up to $10,000 via credit card. The transactions post as a purchase. You do have to accept the statement that you’re a Catholic to open the account.

So $10,000 is charged to your card, you can use this to meet minimum spend requirements for a bonus this way or just earn 10,000 miles for the transaction, and the funds are then in your bank account.. and thus should be available to pay off the credit.

With the huge attention this bank is getting on Flyertalk and on other deal sites I do not expect the opportunity to last for long.

Chase is good about posting charges as purchases rather than cash advances. There are reports that Barclays handles things the same way. Avoid Citibank cards, though, they’re notorious for treating these charges as cash advances so their products are to be avoided in funding bank accounts.