Do Subscription Payments Impact Credit?
Subscription services like Netflix and Spotify have become a norm in the United States. In 2019, the number of Americans with streaming video services surpassed those with traditional cable/satellite TV. These services have a strong presence in our lives, but how do they impact our credit scores?
Paying for your subscription service via a credit card can help build your credit. If you use a credit card to pay for your subscriptions, you can benefit from positive monthly payments.
Start by choosing the right credit card for your subscription payments. Some cards offer increased cash back for specific subscriptions, while others offer cash back for any purchases. Using a cash back credit card to pay for your subscription service could save you money in the long run.
Set up your card to automatically pay your subscription bills each month. Then, pay off the card balance with money from your bank account. This is the money you would have used to pay the subscriptions. You’re simply sending it from a different source.
If you do not have a credit card or do not want to set up these payments yourself, there are alternative options available. For instance, the new program Grow Credit creates a digital Mastercard for subscription payments. There is no credit check required; anyone can sign up for the service. Grow Credit manages subscription payments and automatically withdraws money from a bank account to repay the balance.
The program was unveiled today and is currently in its ‘early access’ phase. Grow Credit will only report payments to Equifax during the launch, but they plan to expand to the other two credit bureaus in the near future.