Should You Pay Rent Using Credit Card in Troubled Times

Should You Pay Rent Using Credit Card in Troubled Times
Should You Pay Rent Using Credit Card in Troubled Times
Vishav - 01 May 2020

Rent payment is perhaps one of the biggest monthly expenditure in one's budget, especially in case of youngsters who are yet to own their own homes. However, due to the COVID-19 crisis, many of them are facing an unprecedented financial crunch making it difficult to fulfill their financial obligations, including the monthly rents of their accommodations.

In such a scenario, one option is to pay rent using credit cards. Many companies offer this facility with becoming the latest to join the bandwagon which earlier consisted of players like and RentPay. launched the 'Pay Rent' platform on its mobile app earlier this week to facilitate rent transfers using a Credit Card. It will allow users to transfer rent directly to their landlord’s bank account and generate digital receipts instantly. They can also avail some offers like reward points and cashback by using this feature.

However, should one make use of such a service taking into account the high interest rate costs associated with credit cards?

According to Dhruv Agarwala, Group CEO,, and, the COVID-19 pandemic has made people want to keep cash in hand due to economic uncertainty in the near future.

"The 'Pay Rent’ platform will allow users to maintain their liquidity if needed over the next couple of months by using their credit cards for rent transfers as it allows flexibility in repayment,” he said.

One can use this facility to get at least a month's reprieve as credit cards don't charge any interest during the first 45-50 days of the billing cycle. However, making a habit of paying rent through credit card would do more harm than good in the long term.

Another thing to note is that if one pays their rent using a credit card during this time, they can also opt for EMI moratorium on their credit card for a few months to tide them over any liquidity crisis in the current environment. So in these circumstances, it might make sense for those who see uncertainty in their future to avail this option.

But one must remember that even during the moratorium period, interest would be charged on the transactions made through credit card and one must keep the outstanding amount to bare minimum.

Finally, one must weigh the costs and benefits in each individual case in order to decide whether it makes sense for them to avail the 'Pay Rent' using credit card option.

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Outlook Money
December 2021


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