Posted by Chuck on June 12, 2017
Manufactured Spending

Published on June 12th, 2017 | by Chuck

66

Visa Cards No Longer Work to Pay Mortgage with Plastiq

Life comes at you fast.

Last week we reported that Plastiq no longer codes at 3x with CSR for rent and mortgage payments. CIP had mixed data points, and even one data point today suggesting that CIP is fixed and coding at 3x again. We still don’t know about Capital One and Bank of America.

However, Visa just informed Plastiq that they can no longer process mortgage payments. Reportedly, rent payments are not affected by the change, only mortgage.

I’ll hazard a guess that mortgage payments sent out via check (e.g. small banks) will still work since the mortgage category is bundled together with rent and real estate, so there isn’t any way for Visa to see which one it is.

[Update: Reports in the comments indicate that rent and HOA can also be affected with this issue. And check-payees are also affected.]

If you can’t pay your mortgage or rent with a Visa, then the CIP question is moot since it’s a Visa card. (Same for the BofA TR question and the Cap1 Venture question since those are also both Visa cards, I believe.) Still matters for rent payments, however.

If you have a scheduled payment, it will reportedly continue processing on the Visa card so long as you don’t make any changes.

Hat tip to redbluefire on Reddit



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Max
Max

Can someone explain why this is happening? Why is this so complicated? Surely Plastiq’s business model is: accept a payment with a credit card, take that cash infusion (passing the interchange fees onto the customer and keeping a bit as profit) and then forwarding it in cash… to anything? Why does it matter whether it’s a person, business or mortgage?

Chris
Chris

If I read it right, it’s Visa making the change, not Plastiq, for what that’s worth. But I wouldn’t be surprised if the gigantic points bill Chase has incurred due to the 3X “travel” coding played a role.

Tom
Tom

And let’s be real here, for a minute… paying a mortgage or rent via Plastiq never SHOULD have coded as travel… it was certainly nice when it did, but no reasonable person can argue that it should be considered a legitimate travel expense. Plastiq was likely playing games with the merchant charge codes hoping to entice more people to use their service, knowing full well that there are tons of cards that earn 3x on travel, and Chase/VISA caught on VERY quickly. It’s funny how Shittybank never really caught on, but Chase caught on within a month or two… regardless of who is truly at “fault” here for fixing the incorrect merchant code, it definitely sucks and it shows how unreliable these bill payment services can be… I would’ve preferred they just left it alone at 1x so we could continue to use the service for legitimate minimum spend requirements…

Jim
Jim

Perhaps it’s not due to the coding issue at all, and rather people abusing the system with VGCs.

Tom
Tom

Perhaps, but honestly I don’t see how that’s considered “abuse” when plastiq is actual, legitimate spending, and you are paying a fixed percentage for the privilege of using their service. I haven’t had a need to unload VGC’s myself with plastiq so I’m not sure if they are currently coding at the 1% debit rate or the 2.5% VISA rate, but if VISA was losing too much money on this, I’m sure they could’ve somehow blocked these plastiq payments on the VGCs only and forced them to go through as credit transactions for higher interchange rates… Mastercard gift cards, for example, don’t work as debit in many “conventional” places, but seem to work fine as credit in many of those same places. I’d bet Chase had a major impact in this decision, considering how many rewards they likely paid out due to 3x plastiq in the past 2 months, since Chase and VISA are so tight.

TG
TG

Citi never had anything to catch on to. It never coded as travel for MC

Tom
Tom

Lol, not necessarily travel perhaps, but there definitely was something to “catch on to”.. but you know how stupid they are…

William Charles

I can see why it might code as lodging and why lodging would code as travel, don’t think it’s that crazy.

AjC
AjC

I pay my rent through a fairly common online portal used by apartments – last week there was the option to pay via Visa, MC or Discover, but the option to pay using a Visa card has disappeared this week. I find it hard to believe that these situations are unrelated, so it seems like Visa may be trying to cut out more than just transactions that might quote as lodging.

William Charles

I agree

chaseaholic
chaseaholic

Had a first ever decline using a VGC to pay rent via plastiq w/ msg stating to contact my card issuer because they were blocking it.

Possibly related?

literally made similar payment ~ 2 weeks ago, same amount, same store/vgc.

Jimmy Deals
Jimmy Deals

I had the same issue. Metabank VGC to pay HOA declined with same message to contact card issuer. Don’t waste your time calling # on back of VGC as I couldn’t get anywhere after 45 min.

Tom
Tom

So many shenanigans with Plastiq lately, it used to be so reliable… I hope we don’t have another Radpad-esque incident. Considering switching back to auto-draft payments by my bank until the dust settles, not worth missing a mortgage payment over a few points. Thanks for the heads up Doc.

Frito Pendejo
Frito Pendejo

This seems like it would be a huge blow to plastiq’s business.

Tom
Tom

That’s what happens when you play games with merchant charge codes…. don’t fuck with Chase.

Ferris
Ferris

No big deal, just buy Mastercard or AMEX GCs instead. Went to my grocery store are there are 10 racks of $20-500 MC, Visa, AMEX split evenly.

Only bad thing is meeting spend for Visa cards. I may just send checks addressed to my credit union.

Tom
Tom

Be EXTRA careful with the Mastercards though, they are known to be subject to fraud much more frequently… unload them as soon as you activate.

artgriego
artgriego

Which grocery store’s/bank’s MGC are you referring to? There was a problem with Ralph’s VGC a year ago but I haven’t heard anything about other specific flavors being especially subject to fraud.

mangina
mangina

Don’t those MCGC and AGC code as credit on Plastiq though? So you’d be paying a pretty high fee to plastiq, in addition to the activation fees just to put some spend on a Visa CC.

Jay
Jay

“I’ll hazard a guess that mortgage payments sent out via check (e.g. small banks) will still work since the mortgage category is bundled together with rent and real estate, so there isn’t any way for Visa to see which one it is.”

Would just like to point out that many payments to big banks are also deliverable via check only as well, and that snail-mail check delivery does not mean that Visa will be accepted.

For example, I tested it out with my Wells Fargo mortgage recipient, which can only be paid via check, and the same error message appeared (which also removed the ability to click the “Submit Payment” button).

Ven
Ven

so any other options to pay mortgage other than plastiq.

appreciate any help on this. I just got CSP and was planning to use plastiq.

Bill
Bill

There are lots of uses for the CSP/CSR/CIP other than Plastiq. The cards are very useful for their Primary CDW when you rent a car, and no FTF if you travel to Canada or other international destinations.

If you obtained the cards solely for Plastiq, this is a major bummer.

John
John

What about Tio (formerly ChargeSmart)? I’ve never used it before, but thinking I may need to now.

Ven
Ven

Thanks John. I will give a try with Tio on my mortgage and I know fee is little higher but I could use for a month or so.

Zack
Zack

So if there’s a DP saying it’s back to 3x for CIP but no more Visa for mortgage payments, but if you have auto payment set up within plastiq it will still work. Does that mean if you still have auto payments on CIP and leave it untouched, those will be 3x? 😛

dawoodman1
dawoodman1

+1 to this

Nun
Nun

What about Ink Bold Mastercard? Did any MC ever code as travel?

Jay
Jay

What about CSR for rent? Is that back to coding 3x?

Eddie
Eddie

I am guessing it is related to fraud with large transaction amount. I discovered I could not pay mortgage with visa card on Saturday and I was hoping it is due to Plastiq fixing the coding issue. Feeling so bad that now the option paying with Visa is gone.

Tom
Tom

Not fraud, just shenanigans by Plastiq most likely.

Miles
Miles

I have been using plastiq to pay mortgage with AMEX or MC. They were never coded as travel. Visa issuers got fed up with paying extra points for non-travel purchase!

Ian
Ian

I don’t understand why the CSR would no longer code as 3x but it would for the CIP. They are both Visa cards so they should use the same MCC system. Is Plastiq is coding as something like internet services that would get 3x on the CIP but not the CSR?

bY
bY

Just received an email from Citi that starting 7/22/17 my ATT Access more card will no longer receive 3x on rental and real estate payments and also gift cards.

Perhaps related to Plastiq?

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