Can I negotiate a 0% transaction fee with my credit card company?
"TL;DR summary: 0% balance transfer offers and ""free checks usable anywhere""   rarely are a good deal for the customer. 0% rate balance transfer offers (and the checks usable anywhere including payment of taxes) come with a transaction fee because the credit card company is paying off the balance on the other card (or the tax or the electric bill) in the full amount of $X as stated on the other card statement or on the tax/electric bill). This is in contrast to a purchase transaction where if you buy something for $X, you pay the card company $X but the card company pays the merchant something less than $X$. (Of course, the merchant has jacked up the sale price of the item to pass on the charge to you.) Can you get the credit card company to waive the transaction fee? You can try asking them but it is unlikely that you will succeed if your credit score is good! I have seen balance transfer offers with no transaction fees made to people who have don't have good credit scores and are used to carrying a balance  on their credit cards. I assume that the company making the offer knows that it will make up the transaction fee from future interest payments. A few other points to keep in mind with respect to using a 0% balance transfer offer to pay off a student loan (or anything else for that matter):" There is nothing called free lunch. The 2% fee indirectly covers the cost of funds and in effect would be a personal loan. Further the repayment period would typically be 3 months and roughly would translate into 7-9% loan depending of repayment schedule etc. There is no harm in trying to get the fee waived, however one thing can lead to another and they may even go and do an credit inquiry etc, so be cautious.
"When you buy something with your credit card, the store pays a fee to the credit card company, typically a base fee of 15 to 50 cents plus 2 to 3% of the purchase. At least, that's what it was a few years back when I had a tiny business and I wanted to accept credit cards. Big chain stores pay less because they are ""buying in bulk"" and have negotiating power. Just because you aren't paying interest doesn't mean the credit card company isn't making money off of you. In fact if you pay your monthly bill promptly, they're probably making MORE off of you, because they're collecting 2 or 3% for a month or less, instead of the 1 to 2% per month that they can charge in interest. The only situation I know where you can get money from a credit card company for free is when they offer ""convenience checks"" or a balance transfer with no up-front fee. I get such an offer every now and then. I presume the credit card company does that for the same reason that stores give out free samples: they hope that if you try the card, you'll continue using it. To them, it's a marketing cost, no different than the cost of putting an ad on television." "You are correct.  Credit card companies charge the merchant for every transaction.  But the merchant isn't necessarily going to give you discount for paying in cash.  The idea is that by providing more payment options, they increase sales, covering the cost of the transaction fee.  That said, some merchants require a minimum purchase for using a credit card, though this may be against the policies of some issuers in the U.S. (I have no idea about India.) Also correct.  They hope that you'll carry a balance so that they can charge you interest on it.  Some credit cards are setup to charge as many fees as they possibly can.  These are typically those low limit cards that are marketed as ""good"" ways to build up your credit.  Most are basically scams, in the fact that the fees are outrageous. Update regarding minimum purchases: Apparently, Visa is allowing minimum purchase requirements in the U.S. of $10 or less.  However, it seems that MasterCard still does not allow them, for the most part.  Moral of the story: research the credit card issuers' policies.  A further update regarding minimum purchases: In the US, merchants will be allowed to require a minimum purchase of up to $10 for credit card transactions.  (I am guessing that prompted the Visa rule change mentioned above.) More detail can be found here in this answer, along with a link to the text of the bill itself." I used to do this all the time but it's more difficult now.  Just a general warning that this probably isn't a good idea unless you're very responsible with your money because it's easy to get yourself in a bad position if you're not careful. You can get a new credit card that does balance transfers and request balance transfer checks from them.  Then just use one of those balance transfer checks to mail a payment to the loan you want to transfer.  Make sure your don't use the entire credit line as the credit card will have the balance transfer fee put on it as well.  You used to be able to find credit cards with 0% balance transfer fee but I haven't seen one of those in ages.  Chase Slate is the lowest I've seen recently at 2%.   Alternately, if you have a lot of expenses every month then it's easy to find a credit card where all purchases are 0% interest for a year or more and use that to pay every possible expense for a few months and use the money you'd normally use to pay for those expenses to pay off the original loan.  If you're regular monthly expenses are high enough you can pay off the original loan quickly and then pay on the credit card with no interest as normal. The banks are looking to hook you so make sure you pay them off before the zero percent runs out or make sure you know what happens after it does.  Normally the rate sky rockets.  Also, don't use that card for anything else.  Credit card companies always put payments towards the lowest interest rate first so if you charge something that doesn't qualify for 0% then it will collect interest until you've paid off the entire 0% balance which will likely take a while and cost you a lot of money.   If you have to pay a balance transfer fee then figure out if it's less then you would have paid if you continued paying interest on the original loan.   Good luck.  I hope it works out for you. That transaction probably cost the merchant $0.50 + 3% or close to $5.  They should have refunded your credit card so they could have recouped some of the fees. (I imagine that's why big-box retailers like Home Depot always prefer to put it back on your card than give you store credit) Consider yourself lucky you made out with $0.15 this time.  (Had they refunded your card, the 1% of $150 credit would have gone against next month's reward) Once upon a time folks were buying money from the US Mint by the tens of thousands $ range and receiving credit card rewards, then depositing the money to pay it off.. They figured that out and put a stop to it. The implied intent is that balance transfers are for your balances, not someone else's.  However, I bet it would be not only allowed but also encouraged.  Why?  Because the goal of a teaser rate is to get you to borrow. Typically there is a balance transfer fee that allows the offering company to break even.  In the unlikely event that a person does pay off the balance in the specified time frame the account and is then closed, then nothing really lost. Its hard to find past articles I've read as all the search engines are trying to get me to enroll in a balance transfer.  However, about 75% of 0% balance xfers result in converting to a interest being accrued.  If you are familiar with the amount of household credit card debt we carry, as a nation, that figure is very believable. To answer your question, I would assume they would allow it.  However I would call and check and get their answer in writing.  Why?  Because if they change their mind or the representative tells you incorrectly, and they find out, they will convert your 0% credit card to an 18% or higher interest rate for violating the terms.  Same as if a payment was missed. From the credit card company's perspective they would be really smart to allow you to do this.  The likelihood that your family member will pay the bill beyond two months is close to zero.  The likelihood that a payment will be missed or late allowing them to convert to a higher rate is very high.  This then might lead to you being overextended which would mean just more interest rates and fees.  Credit card company wins!  I would not be surprised if they beg you to follow through on your plan. From your perspective it would be a really dumb idea, but as you said you knew that. Faced with the same situation I would just pay off one or more of the debts for the family member if I thought it would actually help them.  I would also require them to have some financial accountability.   Its funny that once you require financial accountability for handouts, most of those seeking a donation go elsewhere. Intellectually and logically, it shouldn't bother me for a second to charge something for a buck.  It's a losing proposition for the merchant, but their immediate business costs should be of little concern to me.  (They're making a choice to sell that item to me at that price and by accepting that means of payment, right?)  but the more I charge as opposed to paying cash, the more cash back I get. In my old-ish age, I've gotten a little softer and will pay cash more often for smaller amounts because I understand the business costs, but it's not a matter of caring what other people think. Accepting credit cards, or not, is a business decision.  It's usually a good one.  But with that decision come the rules, which up until about a year ago, meant that merchants couldn't set a minimum charge amount.  Now that's not the case; merchant account providers can no longer demand that their merchant clients accept all charges, though they are allowed to set a minimum amount that is no lower than $10.00. In the end, it's a matter of how much you're willing to pay in order to influence people's thinking of you, because the business/financial benefits of doing one or the other are pretty clear. Zero percent interest may sound great, but those deals often have extra margin built into the price to make up for it. If you see 0%, find it cheaper somewhere else and avoid the cloud over your head. Yes, they're referring to the credit card dispute (chargeback) process. In the case of dispute, credit card company will refund/freeze your charge so you don't have to pay until the dispute is resolved (or at all, if resolved in your favor). If the dispute is resolved in your favor, your credit card company will charge back the merchant's service provider which in turn will charge back (if it can) the merchant itself. So the one taking the most risk in this scenario is the merchant provider, this is why merchants that are high risk pay significantly higher fees or get dropped. Please don't waste any more time feeling bad for merchants for the charges they incur. I don't know who supported the lobby for this rule, but issuers no longer can demand that merchants accept all transactions (even the unprofitable ones).  I discussed this at length on my blog. Merchants accept credit cards for one reason, and one reason only: it brings them more business.  More people will buy, and on average they'll buy more.  They used to take the occasional hit for someone buying a pack of gum with a credit card, but they don't have to anymore.  The new law restricts issuers from imposing minimum transactions that are less than $10. I use a rewards card wherever possible.  I get a cheaper price.  In most cases I don't care what the merchant has to pay.  They've already factored it into their prices. But if you are concerned, then as fennec points out in his comment, cash is the way to go. "Other answers didn't seem to cover it, but most ""0%"" bank loans (often offered to credit card holders in the form of balance transfer checks), aside from less-obvious fees like already-mentioned late fees, also charge an actual loan fee, typically 2-3% (or a minimum floor amount) - that was the deal with every single transfer 0% offer I ever saw from a bank. So, effectively, even if you pay off the loan perfectly, on time, and within 0% period, you STILL got a 3% loan and not 0% (assuming 0% period lasts 12 months which is often the case)." Remember that balance transfers are rarely fee free. As you state, there is a fee associated with the balance transfer. If your 0% rate is for 18 months and the fee is 3%, you are really paying 2% per year on the amount you transferred. The advantage is that you can redirect the debt you transferred is interest free and you can attack other debt with high interest on it. This can save you in interest fees and allow you to direct more of your money towards debt. The disadvantage is that your 0% interest will expire and become a much higher interest rate. Unless you pay off the transfer before the expiration, you will have to pay off the debt at the higher interest. How you decide to attack your debt reduction may need to factor in how long you expect to have debt and what other debt you have. Often times though, the savings in interest is less important than simplifying the number of debt accounts you have. The inspiration you receive from reducing your debt accounts is much more powerful. You realize reducing debt accounts allows you to actually see an end in sight and provides the recurring positive feedback that you are making progressing. This is why the advice to pay off your lowest balance credit cards first. If a shop offers 0% interest for purchase, someone is paying for it. e.g., If you buy a $X item at 0% interest for 12 months, you should be able to negotiate a lower cash price for that purchase. If the store is paying 3% to the lender, then techincally, you should be able to bring the price down by at least 2% to 3% if you pay cash upfront. I'm not sure how it works in other countries or other purchases, but I negotiated my car purchase for the dealer's low interest rate deal, and then re-negotiated with my preapproved loan. Saved a good chunk on that final price! You know those perks/benefits that you don't want to give up? Those are funded by the fees you are trying to eliminate by paying cash. The credit card company makes money by interest, merchant fees, and other fees such a annual fees. They give you perks to generate more transactions, thus bringing in more merchant fees. For a small business they need to balance the fee of the credit card transaction with the knowledge that it is convenient for many customers. Some small businesses will set a minimum card transaction level. They do this because the small transaction on a credit card will be more expensive because the credit card company will charge 2% or 50 cents whichever is larger.   Yes a business does figure the cost of the cards into their prices, but they can get ahead a little bit if some customers voluntarily forgo using the credit card. "Yes, merchants are charged. Visa/Mastercards charge 1 to 2%, of which some part goes to the Visa/MC and the rest to the issuing bank (if you have an HDFC Bank Visa card, HDFC bank is the issuing bank. And yes, you can get a discount from the merchant - while it probably isn't allowed by Visa/MC, some merchants still provide discounts for cash. But you won't get it at places like supermarkets or large brand retail. Late fees + charges can be huge. In multiple ways - first, they all seem to charge a late fee of Rs. 300-500 nowadays, plus service tax of 10%. Then, you will pay interest from the bill date to the eventual payment date. And further, any new purchases you make will attract interest from the day they are made (no ""interest-free"" period). Interest rates in India on CCs are over 3% a month, so you really must get rid of any open balances. I've written a longish piece on this at http://in.finance.yahoo.com/news/The-good-bad-ugly-credit-yahoofinancein-2903990423.html" I think either one would allow for lower pricing tiers as a merchant. I am at 2.5 on my main account.   $0 to $3,000 2.9% + $0.30 $3.20 fee on a $100 sale  $3,000+ to $10,000 2.5% + $0.30 $2.80 fee on a $100 sale $10,000+ 2.2% + $0.30 $2.50 fee on a $100 sale $100,000+ Call 1-888-818-3928