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You may be interested in finding out which bills you can pay with a credit card if you have one – since this payment method has several benefits.
The idea of using credit to pay important bills might not appeal. But there are some useful and even financially savvy reasons for using this method of payment.
In fact, most of the organisations which supply essential services accept the major credit cards including Visa and Mastercard.
Reasons for paying bills using a credit card
You could take advantage of the interest-free period between the time of payment and the payment due date. This is useful if you do not receive a regular salary, which can often result in late payments.
This payment method is also a useful for improving a poor credit score. However, you must make the minimum payment by the due date. If you have a poor credit score, it is probably worth paying off your credit card bill in full every month.
Alternatively, if you have a reward credit card which offers bonus points, air miles or vouchers for everyday spending, then it’s worth investigating which bills you can pay with a credit card.
Bills you can pay with a credit card
Four bills you can pay with a credit card include:
1. Council Tax
You can make a lump sum payment using a credit card. Local authorities are not allowed to issue surcharges on credit card transactions, so there are no additional charges.
The main problem is that the annual bill is large, even with a discount. If you are struggling financially, then a large credit card bill could be a problem. It is probably better to contact your local authority for guidance, since you might be eligible for additional benefits.
Most energy suppliers issue bills you can pay with a credit card. In most cases, payments are made by way of a smartphone app or the company website.
Direct debits are often cheaper, so you will need to work out the additional charges to determine the true cost of paying your energy bills with a credit card.
As with energy suppliers, most water suppliers will issue you with bills you can pay with a credit card. You will need a smartphone or internet access to do this.
Again, direct debits can often be cheaper so bear this in mind because you might be charged more.
Direct debit payments offer big discounts, so check with your supplier. Some companies allow you to pay the line rental as a one-off payment one year in advance for a discount.
You can use a credit card, but you will need to set up a direct debit for broadband charges.
Making regular payments using a credit card
Making regular payments is possible if you set up what is known as continuous payment authority (CPA). To do this you must give the organisation permission to take sums of money from your account when they think they are owed.
A CPA is different from a direct debit or a standing order. The most important difference is that you have less control over the amount taken from your account and when you want to permanently stop the payments.
So it’s probably not advisable to set up a CPA if you live in a house share. You would have sole legal responsibility for the whole bill – which could leave you relying on the honesty of your housemates.
This method of payment is not that common, so it’s a good idea to contact any company you want to pay using a CPA beforehand. They may not accept this type of recurring transaction and even if they do, there might be additional charges.
Paying another credit card bill
You cannot directly pay a credit card bill with another credit card, but you can pay it indirectly. There are two main methods: by balance transfer or by money transfer. Both methods incur a fee.
A balance transfer card allows you to transfer over outstanding balances from other credit cards. A money transfer card will allow you to transfer money from the card to your bank account.
This should be a short-term solution only. If you have outstanding credit card debt, you will need a long–term strategy to reduce the balance.
Do your research. Make sure you are benefiting from using this payment method before you commit.
You will also need to get organised. Unlike a direct debit, when you’re issued with bills you can pay with a credit card, the onus is on you to pay them on time.
Speak to your local authority and utility suppliers and find out about any additional charges. Remember that you will incur additional interest charges if you don’tt pay your credit card balance in full every month.
Looking for a new credit card?
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