Plastiq Review: Pay Vendors at Your Convenience

GOBankingRates Score

4.6
Quick Take: Payment platform Plastiq allows users to take care of any bill with a debit or credit card whether the vendor accepts it or not. This lets users take care of monthly expenses like rent, mortgage or auto insurance payments, daycare or utilities using any credit or debit card they want. Unlike a secured or traditional credit card, Plastiq isn't limited to a specific issuer or vendor restrictions. Instead, the platform takes care of any bill on the user's behalf using a payment method the vendor accepts. While most bills can be paid with Plastiq, some credit cards place restrictions on the use of this service.
  • Cost
    3.9
  • Sign-up Process
    4.8
  • Bill Payment Process
    4.9
  • Payment Methods
    4.9
How did we calculate this?

Pros

  • Earn points with payments
  • Easy sign-up process
  • Streamlined vendor payment process

Cons

  • Transaction fee with every transaction
  • No instant international wire transfers
  • All major credit cards accepted

What Are Secured Credit Cards and How Do They Work?

A secured credit card requires individuals to make a security deposit before opening an account. These cards work like traditional credit cards and run on American Express, Discover, Mastercard and Visa networks.

The security deposit is held by the credit card issuer and the credit line is equal to the deposit amount. For example, individuals can spend $750 if they make a $750 deposit. 

While Plastiq is not considered a secured credit card, it isn’t a traditional credit card either. Instead, Plastiq allows users to pay rent, tuition or other bills with their preferred payment method.

For a small convenience fee, individuals can pay Plastiq with a credit card, debit card, wire transfer or ACH transfer, and Plastiq will pay the vendor using a method they accept.

Key Features

Here’s a look at some of Plastiq’s key features.

Cost

There are costs associated with using Plastiq. A domestic wire transfer costs $5, and an international wire transfer costs $39.

The company charges a 2.85% fee for debit cards, which is currently reduced to a 1% fee for all debit cards issued in the U.S. besides unregulated debit cards, international debit cards and online-only banks. It also charges a 2.85% fee for credit cards.

There are few advantages to paying Plastiq with a debit card. Unless the vendor does not accept debit cards, it is typically less expensive for users to pay the vendor themselves.

There are advantages to using a credit card, as it lets users pay a bill before they actually have the cash. Paying a vendor that doesn’t usually accept credit cards with Plastiq will give users a few extra weeks to come up with the cash without missing a payment. Using a credit card may be less expensive for users than taking out a payday loan or using a cash advance service.

It is possible for users to save money when paying a vendor that does not accept debit cards or credit cards. Plastiq sends a check on the user’s behalf, so the account holder does not have to use their own personal checks or stamps to send the payment.

Sign-up Process

Creating a free account on Plastiq’s website and providing basic demographic information is the first step to start using the service. All users must provide a payment method such as a credit or debit card or an electronic bank transfer. Plastiq allows users to have multiple payment methods on their accounts.

Bill Payment Process

When it’s time to pay a bill, a user needs to add specific details to the platform, including the amount owed, the vendor name and the location. Users can add multiple vendors to an account and save them for future use. This allows them to make a one-time payment or set up recurring payments.

To initiate a payment through Plastiq, users need to provide:

  • The recipient’s name
  • The amount owed
  • The vendor’s preferred payment method
  • The payment date (the day the user wants the money to arrive)
  • Any details on the bill, such as loan number

Electronic payments are made on the next business day. Users should factor in enough time for the payment to clear.

Each payment has a memo section where users can add specifics such as what the payment is for and any other information required by the vendor.

Payment Methods

When a user opens a Plastiq account, they can fund it with a credit card, debit card, ACH transfer or wire transfer. After the account is set up, they can submit the details of the bill they want Plastiq to pay on their behalf. Plastiq reviews the payment methods accepted by the vendor and pays the bill for the user.

Plastiq can pay a vendor through:

  • Bank or ACH transfers
  • Credit cards
  • Wire transfers

While there is a small processing fee for credit or debit cards, the service is compatible with Visa, American Express, Discover or Mastercard. Also, a vendor can accept payments without a Plastiq account.

What Are the Benefits of Using Plastiq?

Plastiq has several benefits, which is why the payment platform has become popular. These benefits include:

  • Enabling users to pay bills and expenses however they want, whether it’s through a ACH transfer, wire transfer, credit card or debit card. Once a request to take care of a bill is made, Plastiq takes care of it using a payment method the vendor accepts.
  • Extending bill due dates by using a credit card to pay rent, utilities or loans.
  • Automating bill payments with a Plastiq recurring payment.
  • Streamlining work processes by setting up payment approval permissions.

Because there is a 2.85% fee involved, it is often best for users to avoid Plastiq if they consistently use their credit cards to fund the bill payments through the platform.

Plastiq vs. the Competition

Several alternative payment methods are available to make it easier to pay vendors and shop online. Here’s how Plastiq compares to some of its competitors.

Plastiq vs. Amazon Pay

Amazon Pay is a service that allows individuals worldwide to pay for things online using information in their Amazon accounts. The fees for using Amazon Pay are 2.9% plus a 30-cent authorization fee for web and mobile payments. By comparison, Plastiq’s fees are 1% for U.S.-issued debit cards and 2.85% for credit cards.

Plastiq vs. Stripe Business

Stripe is a business payment service that lets people send money to vendors or employees using a variety of methods. The fees for Stripe are 2.9% plus 30 cents for each card charge. Plastiq is a more economic option because it doesn’t charge an extra fee on top of the percentage.

Final Take

Plastiq is a payment service that makes it easy to pay vendors that do not accept a user’s preferred payment method. By signing up for a free account with Plastiq, users can add a credit or debit card to their account. Plastiq will then pay the vendor on the user’s behalf using the biller’s preferred payment method. 

Plastiq FAQ

Here are some of the most common questions many often ask about Plastiq.
  • How does a $200 secured credit card work?
    • Individuals who do not have good credit often have problems getting approved for a credit card. Traditional credit card companies check an applicant's credit file and decide whether or not to grant them credit based on factors in their history. Lenders who are reluctant to issue a credit card because of an applicant's low credit score may instead offer a secured credit cardSecured cards require a deposit equal to the credit limit before the card is issued. A deposit works similar to insurance and is used to pay for purchases if the account holder does not make on-time paymentsEach card issuer sets its own limits on secured cards, ranging from a few thousand dollars to only a few hundred dollars. Companies often require an opening deposit equal to the credit limit However, certain companies may increase a user's credit limit without a further deposit after a history of on-time payments. Some companies may convert a secured card to a traditional credit card and return the security deposit after a substantial period of on-time payments.
  • How exactly does a secured credit card work?
    • A secured credit card works similarly to traditional credit cards, but they require a cash deposit equal to the credit line. The deposit is a guarantee on the account, providing the card issuer with collateral in case the account holder does not make on-time payments.
  • Do secured credit cards help build credit?
    • Making timely monthly payments is one of the biggest factors influencing credit scores, making up 35% of the score. A history of on-time payments is imperative to establishing a good credit score. Those who have a history of late payments often do not qualify for credit cards, at least not ones with good interest rates. The best secured cards report on-time monthly payments to Equifax, Experian and TransUnion. A history of on-time payments with a secured card can help to improve or establish credit.
  • What are two downsides of getting a secured credit card?
      • High fees and low spending limits are two downsides to getting a secured credit card. While secured credit cards are a good way to establish a positive credit history, of dollars to establish a large credit line upfront.

    Cameron Cole contributed to the reporting for this article.

    Information is accurate as of May 31, 2022.

    Editorial Note: This content is not provided by Plastiq. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by Plastiq.

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    About the Author

    Allison Johnson has 5+ years of copywriting experience and has produced content for numerous public and private sector clients, including the U.S. Department of Homeland Security and the National Cancer Institute. She has a Master of Public and International Affairs from Virginia Tech and a Bachelor of Science in Journalism from the University of Utah. Her work has been featured in Utah Business Magazine, the Salt Lake Tribune, and the Deseret News.
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