Evo cars in parking lot

While I was playing Santa, CIBC was playing Scrooge

Over Christmas I bought my wife some Evo driving minutes. CIBC charged me a 45% bank charge and 20+% interest fee for the privilege of paying by Visa.

To dispute or not dispute? That is the question. I recently found an unexpected $5 transaction fee on my CIBC credit card labelled “cash adv” (cash advance) and an 18 cent interest charge. Strange, I thought, I never take cash out on my credit card and I pay off my credit card in full each month.

Checking more closely, I found it was for a payment I made to car share company Evo.

Evo had a Christmas promo, its “Stocking Stuffer”, where you could buy $10 worth of discounted miles and gift it to another member. After tax, the transaction was $11.20.

Interesting to note if Evo had been using a domestic, Canadian e-commerce company, this surcharge would have been $3.50. The $5 charge is applied by CIBC on transactions processed outside Canada.

This seemed a bit off. Something I hadn’t seen before.

So I emailed Evo.

Evo Member Services emailed back to say that neither Evo nor its e-commerce partner Shopify charge a cash advance fee and that I needed to contact my bank.

I wrote back saying that I’m a little confused as to why Visa would consider it a cash advance when I was just buying Evo miles. I didn’t receive any cash per se. I don’t remember Evo or Shopify warning me that the Stocking Stuffer transaction would be deemed a cash advance.

I asked: “Before I contact my credit card provider, it would be helpful to know if this is an isolated incident or have other Evo members also had similar charges?”

Evo Member Services replied that it was “an isolated issue that we’ve identified with payments made via CIBC Visa cards”, adding optimistically that my bank “should be able to remove that fee for you”.

The thought did cross my mind whether it was worth my time chasing such a small amount, but I was intrigued and wanted to avoid incurring similar, unexpected charges.

Normally, you can dispute a credit card transaction through online banking. There’s a button right beside each transaction when you log into your account.

But this being a bank charge rather than a transaction the “Dispute This Transaction” feature was inactive and underneath was written: “To report an issue with this transaction please call us for assistance.”

What it should have said is 1) this is “a charge” not “a transaction” and 2) “call and choose to speak to customer services”.

Instead, I called and navigated through the CIBC telephone banking menu to “dispute a transaction”.

After a 60-minute wait the CIBC agent told me abruptly “It’s not disputable. It’s not a disputable transaction. I would definitely help you. But I do not have the tools.”

Mercifully, the conversation was short and he put me immediately through to Customer Services.

I explained the situation. The new agent was sympathetic (or at least, as much as someone, who has heard this a hundred times before, can be sympathetic), but was at pains to point out that CIBC was not to blame. He said the merchant or its e-commerce partner had categorised the transaction as “a cash advance”.

He refunded this particular fee and interest as a goodwill gesture, but warned that future cashlike transactions like gift cards could still incur these fees if they were categorised by the merchant as a cash advance. No comment on why CIBC is apparently the only bank doing this.

My only experience of this charge so far has been buying Evo minutes, but many other CIBC customers have been venting about this same charge when buying gift cards from the likes of Starbucks, Skip the Dishes, Toys“R”Us, as you can see on this Reddit thread:

‘The amazing world of financial institutions has duped me too! I sent my wife a $5 Starbucks gift card in iMessenger via ApplePay, which is hooked up to my CIBC CostCo Mastercard, and was charged a $5 cash advance fee. On top of that, 1 week later I received $0.02 interest on said “cash advance”‘, says Spudology.

“Just called CIBC about 3 cash advance charges for 3 online Starbucks gift card purchases. $5 cash advance charge on each $10 gift card,” reports arland_ohara.

“Had the same experience with Skip the Dishes gift cards I purchased on my Simplii credit card for Christmas presents. $5 each cash advance fee plus interest. I called Simplii and they made some ludicrous claim that it was similar to buying lottery tickets and wouldn’t reverse the charges,” says silentMatt1.

Apparently CIBC introduced the new policy of treating gift cards as cash advances sometime last year, although I could find no mention of this on the CIBC website.

CIBC defines cash advances as such:

“CIBC Credit Card Services also treat Cash-Like Transactions as cash advances. Cash-Like Transactions are transactions involving the purchase of items directly convertible into cash. Examples include but are not limited to casino gaming chips (including virtual casinos and wagering websites), money orders, wire transfers and travellers’ cheques.”

The miles I bought from Evo were not redeemable for cash and they had a use-by date. But clearly were “mis-categorised”.

Presumably if I buy gift cards when buying my groceries, they would just be rung through together as a general goods purchase and so I wouldn’t incur any “cash advance” fee or interest.

Long story short is I won’t be buying online gift cards, tokens, minutes or miles on my CIBC credit card.