Money orders are a widely accepted form of payment. They offer a level of security and reliability that many people appreciate in their financial transactions. But what if you want to use your credit card to pay for one? Who accepts credit cards for money orders, and how popular is this method? In this article, we will examine where you can utilize your credit card to purchase money orders and explore the pros and cons of using this payment method. Buckle up as we delve deep into this subject and break it down into simple, tangible concepts.
Who Accepts Credit Cards For Money Orders Table of Contents
Why Use a Credit Card to Purchase Money Orders?
Money orders are a popular form of payment because they offer several advantages:
- Safety – Money orders can be tracked, making them a more secure form of payment than cash.
- Privacy – The recipient's bank account information is not revealed, ensuring your financial details remain confidential.
- Universal acceptance – Many businesses and individuals are more likely to accept money orders over personal checks due to their relative security.
Nevertheless, purchasing money orders with a credit card might be useful in certain situations. For example, if you're trying to meet the minimum spending requirement on a new credit card to earn a sign-up bonus. In some cases, using your credit card can also allow you to accumulate rewards points or cashback on your purchase.
Who Accepts Credit Cards for Money Orders?
Unfortunately, the number of establishments that allow credit card payment for money orders is relatively limited. Here are some of the places where you might be able to purchase money orders using your credit card:
- U.S. Postal Service (USPS): While USPS permits you to buy money orders with a credit card, they might treat the transaction as a cash advance. This means you could be subject to a higher interest rate and fees.
- MoneyGram: This money transfer company may accept credit cards for money order purchases, but not at all locations. Furthermore, fees and cash advance charges can also apply.
- Western Union: Some Western Union locations might allow you to use a credit card for money order purchases, but this is not universal. Again, fees and possible cash advance charges are factors to consider.
It's essential to check with both your local branch and your credit card issuer before attempting to buy a money order with your credit card, as not all establishments share the same policies.
Disadvantages of Using a Credit Card for Money Orders
There are some significant drawbacks to consider before using a credit card to buy money orders:
- Cash advance fees: Purchasing money orders with a credit card is often considered a cash advance, which means you could be subject to fees and higher interest rates on the transaction.
- Interest charges: Unlike regular credit card purchases, cash advances usually don't come with an interest-free grace period. This means you could start accruing interest immediately after the transaction.
- Limited availability: As mentioned previously, very few establishments accept credit cards for money order purchases, which limits your options.
Who Accepts Credit Cards For Money Orders Example:
Imagine you need to send a payment of $1,000 by money order. You decide to use your credit card to make the purchase at a MoneyGram location that accepts credit cards. The fees for this service are 3% of the transaction amount, which comes to $30. Additionally, your credit card company charges you a cash advance fee of 5% ($50) and a higher cash advance interest rate of 18% APR. This means that your $1,000 money order cost you $80 in fees, plus the interest that starts accruing immediately after the transaction.
Using a credit card to purchase money orders can be a convenient way to meet minimum spending requirements on a card or earn rewards. However, the potential fees and interest charges can make it a less-than-ideal option for routine transactions. Make sure to weigh the pros and cons, and consider whether the convenience is worth the potential costs. Are you looking for more insights on personal finance, investing, and credit cards? Check out our other guides on Flik Eco and don't forget to share this post to help others navigate the world of money orders and credit card payments!