Plastiq enables paying vendors who don't accept credit cards through a card payment system, which then converts it to the vendor's preferred payment method (ACH, wire transfer, or check). The service charges a 2.9% processing fee for both credit and debit cards as of October 2023.

The service supports major card networks including Visa, Mastercard, American Express, Discover, and Diners Club. However, certain restrictions apply - for example, Visa cards cannot be used for mortgage payments through Plastiq.

How Plastiq Works:

1. Create a free account and add your payment cards
2. Add recipient information and payment details
3. Select payment method (ACH, wire, or check)
4. Choose one-time or recurring payments
5. Allow adequate processing time (especially for check payments which take about 8 days)

Best Uses for Plastiq:

• Meeting credit card sign-up bonus spending requirements
• Short-term cash flow management
• Paying vendors who only accept checks
• Converting card payments to vendor-preferred methods

Important Considerations:

• The 2.9% fee can be significant on large payments
• Credit card rewards typically won't offset the processing fee
• Check your card's terms to avoid cash advance fees
• Grace periods may apply unlike with cash advances
• Not sustainable for regular bill payments you can't afford

For a $2,000 rent payment, the Plastiq fee would add $58 to your total. While this exceeds typical credit card rewards rates (1-2%), it may be cheaper than alternatives like cash advances or payday loans if you can pay the balance quickly.

Some credit cards now offer built-in rent/mortgage payment features without fees, such as the Bilt World Elite Mastercard® and Mesa Homeowners Card, which may be better alternatives for regular housing payments.

The service is best used strategically for specific purposes rather than as a regular payment method, as the fees can add up quickly and carrying balances will incur additional credit card interest charges.

Related Articles

Previous Articles