Can you pay vendor bills with a credit card?

If you’re wondering whether you can pay vendor bills with a credit card, the answer is often yes. In fact, there are even ways to do so if a vendor doesn’t accept credit card payments. Continue reading to learn about your options and the benefits of paying with a credit card.

What you’ll learn:

• Paying vendor bills with a business credit card can have several benefits, including earning rewards, having additional time to make payments and tracking expenses with ease.

• If your vendor doesn’t directly accept credit card payments, you may be able to pay your invoice with your card via your credit card issuer or a third-party company.

• Capital One Business cardholders can easily pay vendor bills with their card using Accounts Payable—with no sign-up or subscription fees.

• If a vendor won’t accept credit card payments, you may need to make a case for why they should. This includes presenting several key advantages of credit card payments, such as enhanced security, faster payments and optimized processes.

There are a few different ways you may be able to pay vendors with a credit card.

The ideal scenario, of course, would be to pay your vendor directly using your business credit card, purchasing card (P-card) or business virtual card. Payment may be as simple as following a link on your invoice, enabling faster, more secure transactions. At the same time, paying with your business credit card can help you manage expenses, track cash flow and potentially earn rewards on your spending.

Some third-party companies also allow businesses to process card payments through their platform. The business owner pays the invoice amount plus processing fees, and the company then pays the vendor via their preferred payment method, such as an Automated Clearing House (ACH) payment or a paper check. But be aware that these companies may charge monthly subscription fees on top of payment processing fees for any payment method.

Before choosing a third-party payment service, it’s important to weigh the costs against the benefits to ensure the service aligns with your business’s cash flow strategy and vendor payment needs.

Another convenient option is to pay right through your credit card issuer—they may offer a feature that allows cardholders to pay vendors directly through their business account. For example, Capital One Business cardholders have free access to Accounts Payable, which lets you pay your vendor bills with your business card, even if the vendor doesn’t typically accept credit card payments. And while there are no sign-up or subscription fees for this feature, using your Capital One Business card to send a check or ACH to your vendor incurs a 2.9% processing fee. 

With access to Capital One Accounts Payable, business owners can seamlessly extend payment timelines, maximize card rewards and simplify vendor transactions.

To pay your vendors with a card through Accounts Payable, just follow these steps:

1. Sign in to your Capital One account.

2. Click on the Manage Accounts Payable tab.

3. From the dashboard, you can see upcoming bills or add new bill details.

4. For the bill you wish to pay, select Schedule payment.

5. Select your preferred payment and method for payment delivery.

For a more comprehensive look, check out our Capital One Accounts Payable guide.

Paying vendors with a credit card can be a rewarding strategy for business owners, offering several advantages.

Here are some key benefits that may encourage business owners to use a credit card for vendor payments:

• Earn rewards: Just like consumer cards, many business credit cards offer rewards on your spending, such as cash back or miles. By earning rewards on what you’re already spending, you could save money and support your business’s growth.

• Defer payments: Even if your card requires full payment each month, it can still offer flexibility around when you receive goods or services and when your payment is due. This can be especially helpful for freeing up cash flow.

• Easily track your expenses: Having all your vendor payments in one place on your business credit card can make it easier to track and categorize your expenses. This can also help streamline bookkeeping and tax preparations.

Whether you pay your vendor directly or through your bank or a third party, here are a few things to keep in mind when using a credit card:

• Fees and costs: Some vendors don’t accept credit cards due to processing fees. That’s why there’s typically a 2.9% card transaction fee when paying your vendor through a third party—to offset that cost. It’s a good idea to be mindful of these fees to ensure your rewards are worth the cost.

• Interest rate: Some business credit cards may have high interest rates. Paying vendors with a credit card is generally recommended only if you’re able to pay the balance in full, since carrying a balance could lead to significant interest charges.

• Personal impact: If your business card requires a personal guarantee, you could be held personally responsible for any debt if your business faces financial difficulties. Additionally, if your card issuer reports to consumer credit bureaus, missed payments could impact your personal credit.

If your vendor doesn’t accept card payments, you can make a case for why they should. This means presenting several key advantages, including—but not limited to—the following:

• Enhanced security: Credit card payments provide stronger protections than checks and ACH transfers, which are generally more prone to fraud. For vendors, this reduced risk of fraud means greater transaction security and peace of mind when accepting payments.

• Faster payments and improved working capital: For many vendors, payment speed is a top priority. With quick payment processing, vendors can increase their working capital and enjoy faster access to funds, with less need for outside financing. For example, while checks or ACH payments can take up to 60 days—depending on the vendor’s standard term–credit card payments are often processed immediately.

• Optimized processes: Card payments simplify reconciliation, taking advantage of automated tracking and categorization of credit card transactions. This reduces a business’s reliance on manual workflows. With improved efficiency, vendors can minimize errors, accelerate payment cycles, and focus more on business operations and less on administrative tasks.

Some vendors may accept credit card payments directly, but if not, there are still options for using your card. And Capital One makes it easy.

Start managing and streamlining your accounts payable right from your business account through Accounts Payable with Capital One. And if you’re still looking for the right credit card to meet your business needs, compare Capital One business credit cards today.