How to use BPAY with a credit card

By   |   Verified by David Boyd   |   Updated 24th January 2022

How to use BPAY with a credit card

​​If you are looking for a convenient method to pay all your bills online from the security of your banking environment, BPAY could be an option worth considering. You can use your credit card to make payments through BPAY. However, not all BPAY billers accept credit card payments.

So, how can you get around this inconvenience? Read on for our guide on everything you should know about using your credit card with BPAY.

What is BPAY?

​​BPAY is one of Australia’s most widely used bill payment services that lets you transfer funds electronically from your bank account to billers in a fast and convenient manner. More than 150 banks, credit unions, neo banks and building societies offer BPAY as a payment channel through their phone and internet banking services.

In the past few years, the surge in electronic bill payments, especially during the pandemic, has seen a growing number of payments being processed through the platform. According to BPAY’s website, more than 1.6 million payments are made every business day using BPAY.

Presently, more than 60,000 businesses offer BPAY as a payment mode to customers, enabling them to pay bills securely while also making it seamless for themselves to manage their accounts receivable. The website also lists the steps for paying a bill using BPAY, which are quite straightforward and convenient:

  • Search for the BPAY logo in the corner of your email and paper bill. Also, note the BPAY code for the merchant and your customer reference number (CRN) listed next to the BPAY logo on your bill.
  • Now log on to your internet or mobile banking account.
  • Enter the required information, such as the biller code, your CRN, and payment amount.
  • Choose the account you wish to pay from and the date you want the bill to be paid (but make sure it is before the due date).
  • Pay your bill and record the reference number.

If you don’t want to use your savings to pay for a bill, you also have the option of paying through your credit card account on BPAY. However, not all merchants may allow this, or there may be a small charge for processing the transaction in some cases. Note that BPAY payments can only be made from Australian bank accounts.

Does every business or biller accept BPAY?

To find out whether the biller you are paying accepts BPAY or not, check for the BPAY logo on the particular bill you wish to pay. If you don’t see the BPAY logo, it may mean you cannot use BPAY for paying that bill. You can also check whether a biller accepts payments through BPAY by searching for them on the BPAY website.

BPAY vs bank transfer

Whether you choose to make your payments using BPAY or prefer to pay the money into a seller’s account directly is more of a personal choice. It’s difficult to say whether one is better than the other, but a large percentage of Australians prefer to use BPAY to pay their bills. They find it a more secure and convenient method of paying as there’s no need to share your banking details or personal information on a third-party site when using BPAY to pay your bills.

Payments made through BPAY generally take one business day to appear in the biller’s account. If you used a credit card to pay through BPAY, it could take up to three business days for the payment to settle. A direct deposit from your Australian bank account to another Australian financial institution may reflect within a few seconds when you use a PayID. However, transfers made using a BSB and account number will take one to two business days.

Compare what credit card you currently use against current credit card offers. You might be able to find a better deal.

Can I use my credit card with BPAY?

If you try to make a BPAY payment using your credit card to a biller that doesn’t allow it, your payment will simply not go through.

Even if a biller accepts credit card payments through BPAY, it doesn't necessarily mean that you’ll be able to use your credit card, unless your credit card provider allows it. You can call your credit card provider or bank to find out whether you can use your card to make BPAY payments.

It’s also worth checking whether your credit card provider considers BPAY payments to be the same as a regular purchase or a cash advance. You’ll generally want to avoid a cash advance transaction because it attracts a cash advance fee and cash advance interest charges (generally at an interest rate that is higher than your ongoing credit card interest rate).

Most banks also don’t allow any interest-free periods on cash advances, which means you’ll start paying interest as soon as the payment goes through.

How to make credit card BPAY payments

If a biller accepts credit card payments through BPAY, you just need to select your credit card account while making the payment to process it. But did you know some banks may allow you to use BPAY with your card even if the biller doesn’t accept credit card payments?

While this sounds convenient, the transaction is treated as a cash advance, leading to additional charges you may want to avoid. One way to get around this challenge is using a service like B2Bpay or Rental Rewards to use your credit card for paying your BPAY invoices.

B2Bpay will forward your payment to your biller through BPAY. However, when you use B2Bpay, your credit card issuer will identify the payment as a general transaction instead of a cash advance. Therefore, you won’t pay any extra charges, and you’ll also earn full credit card reward points, just like a standard transaction.

Sniip, a free mobile app, also provides you with a way to make payments from your credit card to any BPAY biller. Sniip has its own payment platform to process the payments. As Sniip is an authorised BPAY payer institution member, your payments are processed as purchases, and you can earn points for them. However, you may be charged a fee by Sniip for using your credit card to pay BPAY invoices.

Paying with your credit card using BPAY? Make sure the transaction is not being treated as a cash advance to avoid additional charges.

Can I earn credit card reward points with BPAY?

Using your credit card for making online payments can help you accumulate reward points and exchange them for various goods and services. But do you still earn points if you use your credit card to pay BPAY invoices?

The answer is tricky.

While you do earn points for transactions that are considered purchases, if the transaction is a cash advance, you will earn no points on it. Instead, you will end up paying a fee for the transaction.

Using a service like B2Bpay could help you maximise your reward points if that’s your aim behind using a credit card with BPAY. All payments made using B2Bpay are treated as regular purchases by credit providers, earning you full reward points as per the terms and conditions of your rewards program.

However, there may be a fee for using your credit card on B2Bpay and it’s worth considering whether the reward points you earn are worth the money you are paying to process the transaction.

FAQs

Can I use one credit card to pay off another through BPAY?

Paying off a credit card using another isn’t advisable, as you are only kicking your debt further down the road. However, it may be possible depending on how your cards are set up.

If you want to use BPAY, you’ll need to ensure that the card you are using for making the payments allows you to make BPAY payments. It’s also worth checking whether your card provider will treat the transaction as a purchase or a cash advance, to figure out how much it’s going to cost you. You’ll also need to be sure that the card you want to pay off accepts payments through BPAY to have the transaction go through successfully.

However, it’s not ideal to use one credit card to pay off another. If you are struggling to pay your bills or unable to afford the essentials, it’s better to seek help from a financial counsellor to find a long-term solution.

An interest-free balance transfer may be a better alternative worth considering.

Is it always free to use BPAY?

No, using BPAY isn’t always free. Many financial institutions allow a set number of free BPAY transactions in a month.

Once you cross the threshold, you could be charged up to 60 cents per transaction, depending on your bank or financial institution. If you use your credit card with BPAY, you may even have to pay a cash advance fee on the transaction.