This is an interesting development.
It appears that AXS is preparing to launch a service called Pay+Earn, which lets you earn credit card rewards on bill payments for a small fee. This would put it in direct competition with other bill payment facilities like CardUp, Citi PayAll, and SC EasyBill.
The new feature is mentioned in a pop-up banner when you fire up the m-station app.
As of now, Pay+Earn has yet to launch. However, it appears as an option during the payment finalization screen, with a notice that it will be available “soon”.
What’s the fee?
Pay+Earn has a little calculator feature that lets you estimate the number of miles you’ll earn. At the bottom, you can see the fee is a flat 2.5%.
They’ve used a 1.2 mpd credit card as their base case for illustrating the number of miles you’ll earn. Both the bill payment and the fee will earn miles, just like with CardUp.
Now, a 2.5% fee is higher than competitors like CardUp or Citi PayAll, and means that Pay+Earn will be less competitive no matter what credit card you use.
|2.5% Fee||2.25% Fee||2% Fee|
DBS Altitude Visa
Citi PremierMiles Visa
SCB X Card
OCBC 90N Card
|UOB PRVI Miles Visa/Mastercard
SCB Visa Infinite (Spend ≥$2K per month)
UOB Visa Infinite Metal Card
|BOC Elite Miles Card||1.63||1.47||N/A|
UOB ReserveDBS Insignia
OCBC VOYAGE (BOS/Premier Banking)
|I’ve only considered general spending cards here because it’s highly unlikely that any 4 mpd opportunities will exist for Pay+Earn (and if they do, they’ll be nerfed rather quickly)|
Therefore, AXS is either counting on:
- Customers being unaware of alternatives to Pay+Earn, or
- Customers wanting to make payments not supported by competing services
What kind of payments are covered?
The following types of payments are listed in the Pay+Earn calculator.
- Town Council
Whether or not they’re exhaustive remains to be seen, but there’s an “others” category which leads me to believe that AXS wants to roll this out for all types of bill payments. Note the absence of “credit cards” as a bill payment category; I’m 100% certain this won’t happen, so don’t get your hopes up.
I also don’t think they’ll enable Pay+Earn for fines, or top-ups. It’s complicated to position the former (“earn rewards for being a menace to society!”), and the latter has too many potential MS issues.
What we don’t know
The main question I have about Pay+Earn is how AXS plans to ensure that rewards points are issued- after all, that’s the very reason for the service’s existence.
It’s no secret that every bank in Singapore already blocks AXS transactions from earning any rewards points, so I’m guessing they’re going to have to process Pay+Earn transactions over a different MCC. The MDR (merchant discount rate) that AXS pays on such transactions will be higher, and your fee will go towards covering the rewards.
We also don’t know whether they’ll have any “launch partner” banks where rewards will be guaranteed. I could see this as a way for banks without payment facilities of their own (e.g DBS, HSBC) to enter the space without needing to set up the infrastructure themselves. I don’t know if Citibank or SCB would be quite so enthusiastic at a potential source of cannibalization (even though their fees are more competitive).
That’s all we know for now, and I expect there’ll be greater publicity closer to launch.
Ultimately whether you find Pay+Earn useful depends on how you value a mile, and the alternatives available to you. CardUp and Citi PayAll are no doubt cheaper, but there may be certain types of payments they don’t support where Pay+Earn could come in handy.
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