Most people will tell you that change is the only constant. In our opinion, however, big expenses such as rent, tuition fees, and taxes are the only constant.
Whether you make these payments every month, quarter, or year, you can be sure that they’ll knock at your door like a faithful friend (or “frenemy” if you will). This friendship isn’t very rewarding though. Especially, if you use your credit card to make these payments.
Until recently, of course.
Payment platforms such as CardUp and iPaymy allow you to earn rewards on all your spends. Including those excluded by credit card issuers.
And now Citi is all set to shake things up with Citi PayAll. This service has currently been rolled out only to a select few Citi customers. If you are among the lucky few you can not only turn big spends such as rent and tuition fees into big rewards but can also buy miles for probably the lowest price in Singapore!
Here’s all that you need to know about Citi PayAll.
How does Citi PayAll work?
Citi PayAll is a payment platform that allows you to use your Citi credit card (currently only 4 Citi credit cards can be used on PayAll) to pay expenses such as rent, enrichment expenses and tuition fees. Depending on the card you end up using, you earn rewards points or miles for your spends!
The person you are sending the money to doesn’t have to bank with Citi, which is a huge plus! So, you can make payments to organisations and individuals irrespective of whom they bank with. The recipient will receive the payment via a bank transfer and the corresponding amount will be charged to your credit card along with the processing fee.
Here’s what the setup looks like:
Credit cards eligible for PayAll (for now):
Note: The rewards you earn per S$1 you spend on making payments will be the base rate of the card that you end up using
So, what’s the processing fee?
The processing fee, from what we currently know, is different for each customer, and is based on your relationship with Citi, and also depends on who the recipient of the payment is.
What we do know for sure is that the fee is not a percentage of the transaction amount (like with CardUp) but is a flat amount. There are 3 tiers and you are charged the amount for each transaction you make.
The approximate fees, according to a Mainly Miles report, is as follows:
- S$24 for payments of S$2,000 or less
- S$60 for payments between S$2,001 and S$5,000
- S$120 for payments between S$5,001 and S$10,000.
If you are wondering why the payments stop at S$10,000, it’s because Citi PayAll payments are capped at S$10,000 per month or 95% of your credit limit. The lower amount will be the monthly cap for PayAll payments.
Let’s understand what this fee structure means
If you consider the fee as a percentage of the upper limit of the tier, you will see that the fee is 1.2% of the amount for each tier (for example, S$24 is 1.2% of S$2,000). This is lower than the transaction fee charged by CardUp (2.6%) and iPaymy (2.25% for Visa and Mastercard credit cards and 3.3% for Amex cards).
Let’s assume that you end up making payments up to the cap of S$10,000 per month. Here’s how much you end up earning per S$ as well as how much you are actually paying per mile.
|Citi PremierMiles Visa Card||Citi PremierMiles American Express Card||Citi Prestige Card||Citi Rewards Card||Citi ULTIMA Card|
|Base Rate||1.2 Citi Miles||1.3 Citi Miles||1.3 Miles||0.4 Miles||1.6 Miles|
|PayAll Cost per Mile||₵1||₵0.92||₵0.92||₵3||₵0.75|
This essentially means that if you use the Citi ULTIMA Card to pay your bills, you are basically buying miles for a mere ₵0.75. If you don’t have the ULTIMA Card, fret not because you end up buying miles for ₵1 with the Citi PremierMiles Visa Card, which is also a great deal!
What you need to keep in mind: If the payment you make falls between any two ranges, the fee will increase. So, at amounts that are between two tiers (such as S$1,800 or S$2,700), the flat fee you end up paying increases the cost per mile making it quite expensive and thereby reducing the usefulness of PayAll.
It does seem that the optimal amount for PayAll to be useful is the upper limit of each tier.
If you have an invite for this service, our advice would be to go ahead and use it. See what permutations and combinations work and accordingly make your decision of how much you want to spend using PayAll.
What else do you need to know about Citi PayAll?
- Your payments will take 7 calendar days to be processed.
- Currently, only principal cardholders can use the service.
- You cannot change transactions once you have set up and confirmed the payment. However, if you want to cancel a payment, you can use the live chat feature on Citi’s online banking platform and request for a payment cancellation.
Suggested reading: Guide to the Best Miles Credit Cards in Singapore + When to Use Which Cards
As of today, based on what we know, Citi is currently testing the waters when it comes to PayAll and changes are bound to be made to its existing terms and conditions. Moreover, the number of categories for which you can make payments is also bound to increase.
Two things are for sure, though; one: the fees will be changed as and when Citi deems fit (something that they have stated in their T&Cs). And two: competitors like CardUp, iPaymy, and UOB PRVI Pay are bound to be looking at ways to get back into the game. So, the next few months are going to be interesting, to say the least!
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