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Can I pay bills on my credit card?

There are pros and cons to paying your bills on your credit card. Some people choose to pay them all on credit. Others will go out of their way to avoid doing so. And in the middle are those who might pay the odd bill on credit if they have to, but will usually stick to bank payments or Direct Debits.

The advantages of paying bills on credit

  • If you're the type of person who uses their credit card for everyday spending and pays it all off every month from your income, there’s little disadvantage financially to bundling your bills up with everything else. It all has to be paid anyway.
  • You can help to keep your credit score healthy by being an active and reliable borrower, and putting your bills on your credit card is one way of doing it.

The disadvantages

  • It's not unusual for utility companies and bodies like councils to charge a fee for bills being paid on credit card. It might only be a few pounds, but obviously this can mount up if you're paying multiple bills with your card over many months.
  • If you don't clear your entire credit card balance every month, you will be charged interest on your balance, which in a roundabout way is increasing the cost of your bills. While this might still work out cheaper than paying overdrafts, it’s still an expense that wouldn’t be there if you paid direct from your bank and remained in the black.

Should I do it?

The pros and cons listed here should help you make a decision about paying things like your gas, electricity, council tax and phone with your credit card. Bills are no different from any other expense, so paying on a credit card comes with the same risks and rewards, and it's a personal choice.

But one big difference is that utilities and taxes are absolute essentials in your financial life, unlike many purchases, and the consequences of not making these payments are much graver. If you can afford to pay off the balance every month or if you face serious problems from not paying your bills, it’s probably worth the expense. Otherwise – and for the majority of people – paying direct from your bank as normal is a perfectly good option.