Utility Bill Payments through Credit Card
Credit cards have completely changed the way individual pay for goods and services. From withdrawing notes and paying for purchases through cash, individuals have now embraced paying for almost everything through plastic money. With the added feature of spending more money than one can afford due to credit, credit cards have revolutionized spending. Credit cards were first introduced in the 1950s and since then are being used throughout the world.
Utility Bill Payments and Credit Cards
Credit cards come with a plethora of benefits and features such as Rewards, Air-Miles, cashback offers, cash withdrawal, wide acceptance and so on. In addition to the above, the main reason individuals use credit cards to pay for their products is the convenience that comes with it. Cardholders can now use their credit cards to also pay all their utility bills. Most banks allow individuals to pay their utility bills through their credit cards, but the process and rates charged vary across each institution.
How to Pay Utility Bills through Credit Cards
Generally what happens is that individuals will have to create an account, login and then add the billers from the list that is provided by the bank. This list generally includes service providers for gas, telephone, electricity bill, insurance and so on. The limitation is that customers can pay their utility bills through their credit card only if the biller is in the bank's seller list. Certain major service providers are registered with all banks.
When it is time to make the payment, customers will have to select the seller, provide all required details and the amount that will have to be paid. Once all details are provided, in the payment option customers will have to choose credit card as their option and then pay their bills.
Additionally, cardholders also have the option to give a standing instruction to their bank and money will automatically get charged to their credit card.
Advantages of Paying Utility Bills through Credit Cards
There are advantages as well as disadvantages to this method of payment. The biggest benefit of availing this service is convenience. Individuals can pay their bills from the comfort of their homes without having to visit each merchant/utility provider. Additionally, if individuals have given a standing instruction to their bank to charge their utility bill payment to their card every month, they will not have to worry about forgetting their bill payment as well.
Certain banks also provide SMS/email alerts every time the amount is charged to their card which will help them track their payment.
Another advantage of paying bills through credit cards is that individuals can avail Reward Points and other offers such as cashback, each time they pay their bill. Charging a higher amount to their card will result in their availing more perks and benefits.
Disadvantages of Utility Bill Payment through Credit Cards
However, there are certain flipsides to this as well. Certain banks charge a transaction fee which is not very high. But overtime, these charges add up to quite a substantial amount. A fee is also charged to the utility service providers. Although individuals can rack up Reward Points and other benefits by using their card, these perks are not substantial. Additionally, a handling fee may also be charged and Reward Points and cashback offers may be applicable for a limited period of time.
Post implementation of GST, certain utility bills will be more expensive but contrary to certain rumours, GST will not be levied twice on payment of utility bills through credit cards.
Paying utility bills through credit cards comes with its own set of advantages and disadvantages. Customers should weigh the pros and cons of using this method of payment for their utility bills prior to using this method.
FAQs on Utility Bill Payments through Credit Cards
- What falls under credit card utility bill payments?
Payments for utilities are an important part of the monthly budget, which also includes payments for things like gas, electricity, water, mobile phone recharges, cable TV recharges, and many other things. Credit cards can be used to make a variety of purchases that earn different reward points, extra discounts, and cashback offers.
- Can I use my credit card to pay my electricity bill?
Yes, you can use credit cards from any card issuer to pay your power bill by visiting their official website or via a mobile application (if available).
- How can I make a payment for my utility bill with my credit card?
Use the official website of your card issuer to log into your account and pay your utility bills using your utility credit card. To complete the utility credit card bill payment process, choose the billers, enter the payment amount, and supply the card information.
- How many kinds of utility bills are there?
There are several utility bills that are calculated based on the rate of usage of the individual, including cable TV, internet, cell service, water, electricity, gas, and waste.
- Can a utility card be used at a POS machine overseas?
Yes, some utility credit cards can be used at Points of Sale (PoS) abroad. One such card is the GT Utility card, which can be used at a variety of gas stations both domestically and abroad.
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