Online payment systems are a great way for some people to get more use out of their credit cards. These services also allow card holders to take advantage of financial incentives like cash back and other bonuses. One popular online payment service I decided to try is Plastiq.
The way Plastiq works is that it pays most any merchant from your credit card — essentially letting you pay with credit card even if a particular merchant doesn’t accept plastic.
You can choose to pay Plastiq several ways, including via check or wire transfer. I recently signed up for the service to see if I could pay a bill that had been vexing me for some time. Here’s how my experience went and why I likely won’t be using Plastiq again:
Plastiq: Everything you need to know about the online payment service
When I signed up, the site immediately sent me a message saying that if I confirmed my email within the first 15 minutes, I could earn $50 in fee-free transactions on Plastiq. So that’s what I did. Moments later, I got an email saying I was “good for up to $50 in free payments.”
I saw another notification near the top of the screen: “Interested in faster payments? Confirm your identity to get access to electronic funding methods.” This feature enables ACH and wire transfer payments from your card. It takes just minutes to verify your account, so I did that as well.
Plastiq: 5 things to know about the online payment service
If you’re thinking about using Plastiq as a bill payment service, here are several things to be aware of:
1. What is the fee for using Plastiq?
The Plastiq fee if you’re using one of the major U.S. credit cards such as American Express, Diners, Discover, Visa, MasterCard will be 1% plus a percentage of the principal, typically around 2.5%. Using a card issued in another country? Expect to pay cross-border fees depending on which country.
2. How long do Plastiq payments take?
Once you input your payment information, Plastiq will show you a calendar. You can schedule your payment any day available on the calendar, usually about a week out.
If you put an address in the system that it doesn’t recognize, Plastiq will suggest one that it does. This way, if you’re sending a paper check, it is less likely to get lost in the mail.
3. Plastiq has a Delivery Guarantee
The good thing is that Plastiq has a Delivery Guarantee which states that your payment will arrive to the recipient within the projected timeframe you selected.
“If this guarantee is not fulfilled, you are eligible for reimbursement of any late fees associated to the Payment which may have accrued between the quoted delivery timeframe and actual delivery,” it says on Plastiq’s website.
If Plastiq’s guarantee fails, you can get reimbursed by emailing [email protected] with your payment ID, proof of due date and evidence of late fees charged or owed.
4. How to reach Plastiq customer service
The three ways to reach Plastiq’s customer service are by live chat at Plastiq.com, calling support at 844-752-7847 or contacting them via email at [email protected]. If you reach out via email, expect to hear back within one business day.
5. Plastiq review takeaway: Read the fine print
I was initially charged a $7 fee for a transaction that was a little under $300 — but remember, I had a $50 credit. Here’s the thing, when I pressed the button to “Apply my Fee Free Dollars,” I was thinking this would drop my total down to around $250, but it didn’t. What it did do was drop my fee down to $5 and some change.
“What just happened?” I thought to myself. I wanted to find out, so I launched Plastiq’s live chat.
So that you aren’t mistaken about the FFDs (Fee Free Dollars) as I initially was, here’s what “Tony” from the Plastiq live chat told me: “FFDs themselves are not monetary in use towards your payment principle. It only helps reduce the Plastiq fee (2.5% of the payment).”
Here’s what the customer service rep said further: “50FFDs sets aside the fee that would have been charged on that $50 of the payment, and only applied the Plastiq fees to the rest.”
That means that instead of getting $50 off my $300 bill, which I took the term “$50 in free payments” to mean, Plastiq took the 2.5% fee off $50 of my total.
I asked the rep if this information was easily explained somewhere on the site before people sign up. I was then directed to the Plastiq Help Center, which doesn’t expressly say what FFDs are, but … in my opinion, this incentive is not exactly bait and switch, but it’s akin to what I’d call (re)bate and switch.