Credit card autopay explained

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If you’re tired of having to remember to pay your credit card balance or minimum payment manually, each month, you may have found yourself curious about autopay options offered by your issuer.

Automatic payment options are offered on many billing platforms such as utilities, subscription services and memberships. Despite the prevalence of autopay in other industries, however, many consumers find autopay to be confusing when it comes to credit cards. Here’s what you need to know before enrolling in autopay with your credit card issuer.

What is autopay?

Automatic payments or “autopay” is a feature offered by most credit card issuers that allows you to have your balance or minimum automatically paid when your statement is posted. You can set up autopay with your credit card issuer over the phone or online and can discontinue the feature at any time.

Who offers autopay?

Issuer Automatic Payment Options
Chase Enrollment available online, in the Chase Mobile App, and in person in a local Chase branch.
Discover Enrollment available online, through the mobile app, or by calling customer service,
Barclays Barclays does not currently allow you to enroll in autopay through their mobile app, however, enrollment is available online or through the Barclays iPad app.
American Express Enrollment in autopay available online, through the AmEx app, or by calling American Express customer service.
Capital One Enrollment available online, through the Capital One app, or by calling customer service.
Bank of America Enrollment available online or by calling customer service.
Wells Fargo Enrollment available online, through the mobile app, over the phone, or at a Wells Fargo branch.

Autopay options

If you make the decision to enroll in autopay with your issuer, you will be presented with three options: pay the minimum, pay the full balance, or pay a fixed amount.

  1. Pay the minimum: Choosing to set up automatic payments to pay your minimum can ensure that you aren’t hit with late fees if you forget to pay your bill on time. Minimum payments vary with some issuers charging a flat rate, such as $25 a month, while others charge a certain percentage of your total balance. As with manual payments, only paying your minimum will cost you a lot in interest over time, so if you choose to enroll in autopay at the minimum amount monthly, make sure you’re making supplementary payments often to avoid getting into long-term debt.
  2. Pay full balance: When it comes to credit cards, paying your monthly balance off in full is always best practice, and this is no different with automatic payments. If you choose this option for autopay, it’s important to make sure that your checking account has enough money at the time of the automatic withdrawal each month. If you forget that a payment will be posted to your account and overdraft, you could be hit with double the fees in the form of overdraft charges and a return payment fee from your issuer.
  3. Pay a fixed amount: The third option for autopay is to set a fixed amount each month you want to pay. This can be a good debt reduction strategy if you’re steadily working to pay off a large balance because you can tackle your debt with payments that work for your budget, but keep in mind that paying anything less than your full balance results in added interest. However, if you’re worried about missing a payment, setting up autopay for a fixed monthly amount can offer you peace of mind.

Benefits of autopay

The most obvious benefit of setting up automatic payments is that it saves you from late fees and hits to your credit score that comes with forgetting to pay your credit card bill.

When life gets hectic, it is easy for a payment deadline to slip through the cracks. If this happens, services like automatic payments serve as a backup to make sure you never miss a payment. Setting up automatic payments gives you the freedom to use your credit card and earn rewards without the hassle of remembering to pay your balance monthly.

Things to consider before enrolling in autopay

While autopay is certainly convenient, it may not be for everyone. Before enrolling in autopay, take note of your current financial health and decide if now is a good time to take your eye off your charges.

Autopay makes paying your bills a simple process, but it also means that you may spend less time monitoring your credit card statement and spending habits. If you do choose to use autopay, it’s important to still monitor your account to watch for fraud or accidental overspending. When you set up autopay with your credit card, you also run the risk of accidentally overdrafting if you spend more than expected.

Final Thoughts

When it comes to autopay, its true value depends on how you use it. If you’re looking for an extra protection against added fees that come with forgetting to pay your balance, then autopay could be a great option for you. But, if you’re prone to forgetting to check your credit card activity regularly, setting up autopay could lead to more problems down the road from inattention. Autopay is a great way to ensure that you never forget a payment deadline, but it can’t replace the important practice of diligently monitoring your accounts and spend

Written by
Meredith Hoffman
Credit Cards Reporter
Meredith Hoffman is a personal finance writer covering credit card news and advice at Bankrate. She is originally from Columbia, S.C., and received her bachelor's degree from the Univ. of North Carolina at Wilmington. Before joining Bankrate in October 2019, Meredith worked as the news editor of Wilmington’s local newspaper, The Seahawk.