Many businesses today are accepting a credit card as a valid form of credit. This can make paying your bills a lot easier because you don’t have to write checks, pay for stamps, and worry about the postal service losing your payment in the mail.
Although paying bills in this manner is fast and effective, there are also 5 things that you need to know right now that could affect how you are using your credit card to pay your bill.
#1. Rewards might need to have a POS transaction to qualify. If you are paying your power bill online, your rewards card might not pick up the transaction as a qualifying reward. That’s because some lenders have put in a stipulation that requires a point of sale transaction for a reward to be generated. This means you’d have to go down to your power company’s customer service department in person to get the cash back or rewards points you want.
#2. Not every bill payment website offers a secure site. It seems like common sense to look for the HTTPS symbol or the green color of security in a website browser, but with so many providers offering secure transactions, we forget to check the actual web address during a bill payment. Local providers especially don’t always have secure sites for payment processing. Always double-check, just to be safe, and make sure you’re on their official website as a second measure of security.
#3. It might take some time to process. Paying bills online with a credit card is a fast and easy way to get the job done, but it isn’t always an instant service. Some agencies may take 3-5 business days to process a transaction online, which means if your due date is tomorrow, your payment might not be processed on time. This could make you subject to late fees and other penalties, even though you scheduled the payment before the due date.
#4. Watch out for extensive processing fees. Even though you are paying a bill by credit card, some processors convert those credit card funds into secured funds before transmitting the payment. This is especially common when paying a car vehicle loan online with a credit card. The conversion to secured funds that are wired to the provider has a fee that begins at $10.95 and goes up from there. That’s a lot of cash for the convenience of fast cash, so you may not wish to pay every bill online.
#5. Banking institutions charge fees for bill paying too. Those convenient bill paying services your banking institution offers make paying bills faster with your credit or debit card, but that comes at a cost. Some give this service for a flat fee, while others charge consumers a small percentage of the bill that has been paid. If you are paying a dozen or more bills through this service, you could save upwards of $20 per month just by doing the work on your own.
Paying bills down with your credit card is a fast and effective way to meet your obligations, but it isn’t always a free service. By keeping tract of these 5 specific things you need to know, you’ll be able to maximize your bill paying experience every month.