Sounds like a no brain deal, where you can convert $1000 to 12 months payment plan and receive $100 gift card by paying $19 one-off fee.
What's the catch on this?
Once i received my gift card, can i Pay $1000 off straight away?
Coles Credit Card is issued by Citigroup. See also: Citi Quick Cash: 12-Month Interest Free (Bonus $100 Gift Card with $1000+ Cash Advance), 1.90% Setup Fee @ Citi.
I’d rather avoid the credit score hit
Theres no credit check as an existing card holder so how would it affect your score?
Was worried about the credit score as well.
"fixed monthly instalments"
Coles cards are backed by Citibank. And they are notoriously bad for gouging you whenever they can, and will lock you into payments even if you no longer want them.
Also, when you have an active balance transfer on their card, any interest free periods are goneski. For instance you make a purchase on it (say a grocery shop of $400), and the way they apply payments I'll guarantee you'll pay something like 21% on that money.
I'd be very very cautious, and get any confirmation about how this offer works IN WRITING.
New credit card legislation introduced 2 years back resolved the issues with interest free periods. Now the rules are in benefit of the cardholder. I worked on some of these changes and they geniunely reduced the amount of interest banks were getting across the board.
I did a fpo last month. Dont you have wait until next statement cycle to qualify for another gift card?
Yes, I do wonder this as well.
Plus, it says "one gift card per account" and I am a bit mindful in the off chance if this would mean that you can only get one gift card no matter how much FPO offers you apply throughout the life of your card. I am pretty sure this is not the case (and I'm just imagining the worst), but I think the wording is as vague as lawyers would love to have it.
I read the pds. Don't you need to pay in forced x% instalments? Doesn't seem worth it
No, there's no interests on the FPO for 12 months. Only the once-off setup fee of 1.9%.
The instalment is basically the FPO amount divided by the number of months you select.
For example, if you setup an FPO of $1000 for 10 months, then you'll pay:
Month 1: $100 repayment + $19 setup fee.
Month 2 - Month 10: $100 repayment per month.
And by month 10 your FPO is completely paid off.
I asked this question with Coles when they called and offered me this. If I pay in plans and I bought an item in one shop say $500, when I make payments to my credit card, how will it know to pay this monthly payment and the rest to new transaction in the credit card. The girl asked her supervisor and said I need to call them and tell how the payment will be allocated. I didn't press further with my questions like will it all go to the monthly payment or all go to the credit card bill first as she seem to not know and was asking her supervisor. I think this is a grey area and not worth my time to chase up if there are issues. Maybe it is good if you have a small amount and this credit card is not your main card.
They're really trying to push this offer. I received a phone call, multiple emails, and texts with this offer. Made me unsubscribe.
I was offered 5.99% so it seems it's different offer for different cardholders.
I was a bit confused about this as well, but FROM MY UNDERSTANDING (please note that this is NOT a financial advice) the payment will be distributed in the following order:
1. The monthly repayment for your FPO,
2. The purchases for the statement period, and
3. The remaining balance of your FPO.
Scenario 1:
Let's say you set an FPO of $1000 with 10 month instalment (which means $100 monthly repayment). Then in the same period you make purchases of $481 — and with $19 FPO setup fee this adds up to $500.
The statement comes and you pay, let's say $650. The payment will be allocated as follows:
1. $100 off your FPO.
2. $500 off your purchases.
3. A further $50 off your FPO.
Which means the balance of your purchases is now $0 and the balance of your FPO is now $850.
Scenario 2:
Same setup above, but instead of paying $650, you only pay $500. The payment will be allocated as follows:
1. $100 off your FPO.
2. $400 off your purchases.
This means the balance of your purchases is $100 (which attracts interest) and the balance of your FPO is $900 (which does not attract interest).
I believe this is the warning that they are trying to warn us, because in this case, rather than allocating the whole $500 payment to the purchases (which attracts interests), it will be allocated to $100 off your FPO (which does not attract interest) and $400 on purchases, leaving you with a balance $100 purchases (which attracts interests).
Despite the comments above, I am not 100% sure that you are able to call them and tell how the payment should be distributed to, as this would be a massive workload for them and I don't think they would want that. Of course if their staff gave you the wrong information, you can always go through proper channels and request Citibank to give you compensation — but is it really worth the $100 gift card?
Note: as per the T&Cs, make sure your FPO is greater than $0 until at least you've received your gift card, or you won't be eligible for the gift card.
https://files.ozbargain.com.au/upload/137114/88342/colesoffe…
Please bear in mind that 1% of balance owing will need to be taken in to account as well apart from the $19 setup fee.
On a $1000 application, $19 fee + $25 if you keep the balance open for at least 3 months. Total of $44.
$44 is the total min cost involved in exchange for a $100 gift card.
yes