Pay Your Utilities With Plastic

(In today’s day and age, just about everything is paid for with a credit card or debit card; cash is becoming more and more obsolete these days. )

Many Americans do not only make everyday purchases with plastic, but many also pay regular monthly bills with their cards as well.

Not only is it more convenient for most people, but some companies and banks even have options where they can charge your card automatically every month for the outstanding bill.

But one thing that most homeowners and apartment renters have not been able to pay for with a card has been utilities.

Those days seem to be ending too.

Now, more and more utility companies are allowing their customers to pay their bills with their credit or debit cards instead of with cash or check. This is making things a lot easier for today’s society.

A December 7, 2006 article by Robin Sidel of The Wall Street Journal, “Paying utility bills is getting easier,” looks into the new payment options some companies are now offering.

“The payment-card industry is charging into one of the last bastions of consumer business that has been slow to accept plastic: utilities. In the past year, a number of large natural-gas and electric providers have begun allowing residential customers to pay their bills with credit and debit cards. Utilities are dropping their longstanding opposition to plastic as new competition looms in states that have deregulated the former monopolies. To help hang on to customers, the utility industry is searching for ways to make bill-paying faster and easier.”

Many big utility companies are catching on to this new trend, although with a few strings attached. Pacific Gas and Electric Company in California is allowing customers to pay their bill with Visa credit, debit and prepaid cards purchased with money already loaded on to them.

Many other companies have begun letting customers pay with regular credit and debit cards from their own wallets.

“The moves come at a time when consumers are paying more of their monthly bills with credit and debit cards. Nearly 40% of U.S. households have at least one recurring monthly payment that is automatically linked to a credit card, according to MasterCard Inc. research.”

One thing that customers who use credit cards need to realize is that if they do not pay their balance in full every month, they could end up paying interest on utilities, which is just another unneeded waste of money.

“Indeed, annual interest rates on unpaid credit-card balances can be more than 20%. One way to avoid that risk: Consumers can choose to pay by debit card, which draws money directly from a checking account.”

Part of the problem with getting utility companies to accept cards are because many do not think they are worthwhile.

“The card companies typically promote the use of plastic by telling merchants that consumers who use cards often spend more than cash-paying customers. That argument doesn't work for utilities, as people don't buy more power when they pay their bills with a credit card.”

“What's more, accepting payments by plastic can be expensive for merchants who must pay fees to the card-issuing financial institutions, buy new equipment and maintain strict security standards.”

But it seems as though utility companies will have to cave in completely as we become a society more and more dependent upon plastic.

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