How to Pay Your Utility Bills with a Credit Card

If you have a rewards credit card, you may be looking for more bills you can pay using that card. I’m a big fan of maximizing credit card rewards, since I earn cash and discounts just for my normal spending.

However, paying utility bills with a credit card isn’t always a great idea. You need to check on your utility provider’s fee structure, since many companies charge fees for credit and debit card payments, which can negate the benefits from the credit card issuer.

So even though it sounds tempting to try to earn cashback rewards or other perks by putting these routine bills on a credit card, it’s important to weigh the pros and cons before doing so.

Can you pay utility bills with a credit card?

Most utility companies, including electric, water, cell phone, and internet providers, will allow you to use a credit card to pay your bill. However, some may charge a fee for the convenience of using a credit card. According to the National Association of State Utility Consumer Advocates, those fees can range from $1.50 to $5.85 per transaction.

If your electric company charged you $5.85 per transaction to pay your monthly bill with a credit card, you’d pay $70.20 per year just in fees. And remember, not all of your utilities are usually with the same provider, so you might need to multiply fees by each individual utility company.

Some utility companies don’t accept credit card payments, but you can get around this problem by using a third-party service like Plastiq. You pay these servicers with a credit card, and they’ll then pay your utility bill using a check or money transfer.

However, you should keep in mind that these services charge extra fees. For example, Plastiq charges a 2.9% fee on every transaction (similar to the fee many utility providers charge for credit card payments).

Are credit card rewards worth the fees?

As with any financial decision, you need to consider the cost against the benefits. In other words, are credit card rewards worth more than any fees you’d pay for using credit cards? If not, you may be better off finding another mode of payment.

Imagine your credit card pays you back a flat 1.5% on purchases. If your average monthly electric bill is $140 and your annual total is $1,680, that nets you $25.20 per year in rewards. But if the utility company’s fee to use a credit card is $2.50 per month, you’re paying $30 per year for that privilege, which is more than your rewards are worth.

Although not many rewards credit cards offer bonuses on utility bills like electricity, a few offer benefits in that area. The Blue Cash Preferred® Card from American Express pays 6% on select U.S. streaming subscriptions (which some might consider a utility bill category).

To earn the most, pick a rewards card that offers enough to make up for fees, or use your card for utilities that don’t charge a fee at all. Luckily, that’s becoming more common: According to Power Grid International, over 30 utility companies offer fee-free credit and debit card processing (as of 2017, so that figure may have increased or decreased).

Is it a good idea to pay utility bills with a credit card?

Using your credit card to pay for utilities may sound like a no-brainer to earn rewards, but there are distinct benefits and drawbacks you should consider.

4 reasons to pay utility bills with a credit card

• You want to automate payments: If you link your utility accounts to a credit card, you can usually sign up for automatic payments. Autopay will ensure you never miss a payment, giving you one less thing to worry about.
• You want to track your spending: You may find it helpful to sync your credit cards with a budgeting app, helping you track your spending and manage your money.
• You don’t want to write a check: If you’re like me and your checkbook rarely sees the light of day, paying for utilities with a credit card is much more convenient. You don’t need to remember to write and mail a check (avoiding the hassle and cost of stamps, too).
• Card rewards outweigh extra fees: Your credit card rewards points or cash back can add up if you use your card to pay for utilities. If you had $4,000 per year in utility bills and used a card that offered 1.5% cash back on every purchase, you’d get $60 in cash back annually. But watch out for card fees.

4 reasons to pay utility bills with a different mode of payment

• The utility company charges high fees: Many utility companies charge a processing or convenience fee for credit card payments, so you should ensure the credit card points you can earn will offset the fees you pay.
• You have to use a third-party service: Some companies won’t even allow you to pay by credit card. In that case, you’ll instead have to use a third-party service if you’re set on using a credit card, incurring extra fees.
• You’re worried about your credit score: It’s possible that using your cards to pay for utilities could damage your credit score. Check your credit utilization — how much of your available credit you use. This accounts for 30% of your FICO credit score. With more charges on your card, you’ll use more of your credit line, potentially increasing your credit utilization and reducing your credit score.
• If you don’t pay your balance in full: If you’re looking for credit card rewards, use your cards wisely. If you’re worried you might let your credit card balance grow instead of paying it off in full each month, it’s better to pay by check or ACH.

FAQs

Credit cards we recommend for paying your utility bills

If you decide to use a credit card to make utility bill payments, consider a general card that offers a flat rewards structure on every purchase.

For example, the Chase Freedom Unlimited^® allows you to earn 6.5% cash back on travel purchased through Chase Travel℠, 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service and 3% cash back on all other purchases (on up to $20,000 spent in the first year). After your first year or $20,000 spent, earn 5% cash back on travel purchased through Chase Travel℠, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service and unlimited 1.5% cash back on all other purchases. So you could earn $60 worth of rewards at a 1.5% rate after spending $4,000.

Or the Capital One Venture Rewards Credit Card gives you 2 miles per dollar on every purchase, every day, 5 miles per dollar on hotels, vacation rentals and rental cars booked through Capital One Travel and 5 miles per dollar on Capital One Entertainment purchases through 12/31/25. With $4,000 worth of utilities, you could get 8,000 miles — an $80 value you can redeem toward travel.

By shopping around for the best credit cards, you can find a card that fits your spending habits and lifestyle.

Want to pay for more household expenses with your credit card? See how you could cover your rent, mortgage, or even student loan bills with your card.

One important thing to keep in mind about credit cards is that you never want to increase your spending solely for the purpose of earning more rewards. While cash back, travel perks, and other benefits are terrific, you should never go into debt or make unnecessary purchases in the name of rewards.

Unlimited Cash Back

Chase Freedom Unlimited^®

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Chase Freedom Unlimited^®

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Current Offer

Earn an extra 1.5% on everything you buy (on up to $20,000 spent in the first year) — worth up to $300 cash back. That's 6.5% on travel purchased through Chase Travel℠, 4.5% on dining and drugstores, and 3% on all other purchases.

Annual Fee

$0

Rewards Rate

6.5% cash back on travel purchased through Chase Travel℠, 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service and 3% cash back on all other purchases (on up to $20,000 spent in the first year). After your first year or $20,000 spent, earn 5% cash back on travel purchased through Chase Travel℠, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service and unlimited 1.5% cash back on all other purchases

Benefits and Drawbacks

Benefits

• High base rewards rate of 1.5%
• $0 annual fee
• Valuable welcome bonus for new cardholders
• Intro APR offers for purchases and balance transfers

Drawbacks

• Has a foreign transaction fee of 3% of each transaction in U.S. dollars
• No bonus categories for gas or groceries

Card Details

• INTRO OFFER: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!
• Enjoy 6.5% cash back on travel purchased through Chase Travel℠, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 3% on all other purchases (on up to $20,000 spent in the first year).
• After your first year or $20,000 spent, enjoy 5% cash back on travel purchased through Chase Travel℠, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases.
• No minimum to redeem for cash back. You can choose to receive a statement credit or direct deposit into most U.S. checking and savings accounts. Cash Back rewards do not expire as long as your account is open!
• Enjoy 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 19.74% - 28.49%.
• No annual fee – You won't have to pay an annual fee for all the great features that come with your Freedom Unlimited® card
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