As part of a promotion to drive more cardholders to use credit cards to pay routine bills, customers of bill payment firm ChargeSmart Inc. will waive its service fees for customers who pay their utility bills using a Discover card, the companies recently announced.
Fees typically range between $3 and $6, ChargeSmart says.
San Francisco-based ChargeSmart, which enables 300,000 consumers to pay more than 500 utility billers in the U.S., is running the promotion for an undetermined amount to time with Discover Financial Services to boost usage of its services, Tim Brinkman, ChargeSmart CEO, tells PaymentsSource.
ChargeSmart also has a link on its website where consumers can apply for a Discover card, says Brinkman.
Discover’s goal in the promotion is to raise consumer awareness of the option to use credit cards for paying bills, a spokesperson says.
As a further incentive, Discover makes clear to consumers that payments cardholders make to ChargeSmart for utility bills also count toward the 1% cash back rewards cardholders typically receive for using their Discover card.
“We are eager to observe consumer reaction to the promotion and currently [are] evaluating other promotional opportunities,” the spokesperson said via email.
One analyst says the promotion makes sense for both companies.
Offering a rebate is a good incentive to get consumers to use their cards to pay utility bills, says Madeline Aufseeser, senior analyst, Aite Group.
But Aufseeser notes that consumers could end up paying interest on their utility bills if they fail to pay off their Discover card in full each month.
ChargeSmart also is preparing to go live with its deal with Plastic Jungle enabling customers to apply gift card values to paying bills through its site (
The company also is seeing interest from banks who want to rebrand the ChargeSmart bill-payment website as part of their own service offerings. “We’re just starting this effort but we are four for four with banks so far,” says Brinkman, adding that he expects to have 20 to 25 banks on board by the end of the year.
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