As you may have read in my previous entries (here and here), I'm a big fan of CitiBank credit cards and their generous rewards programs. This is not, however, to say that Citi is a credit card panacea. In fact, I just ran into one of their less obvious limitations during the past week.

I've been busy with a variety of extra things as of late, and I got to my monthly online bill paying duties a bit later than I otherwise would have. It turns out that my bank can't (won't?) allow for automatic bill payments for anything over the minimum amount due. If you want to pay your credit cards in full, you need to log in and schedule the payment each month. Stupid policy, but it is what it is. Anyway, when I went to pay our Citi Driver's Edge card, it turned out that the soonest that the payment could be made was the day after it was due. The good news was that the due date was still five days away, so I could still mail the payment if necessary.

(Side note: It hardly seems reasonable that an online payment could take so long to complete. I know that some payees don't accept electronic payments; rather, the bank has to cut and mail a check. I have no idea if Citi is one of these, but I somehow doubt it. Then again, it was already late in the day, and there was a weekend coming up, so three days were effectively shot.)

Anyway, I didn't want to write a check and run out to find a mailbox before the last pickup – I wanted to take care of it right then and there. So I logged into the Citi website and enrolled in their Click-to-Pay program. I entered our bank's ABA routing number and our account number and was ready to roll. When I went to make the payment, however, I was surprised when the following message popped up:

"During the initial Click-to-Pay enrollment period, you can make one Click-to-Pay payment in the amount of your current minimum due, up to, or equal to $499."

In other words, if you join Click-to-Pay as a last minute way of getting your bill paid on time, there's a pretty high likelihood that you won't be allowed to pay it in full (unless, of course, your outstanding balance is ≤$499). Thus, you'll end up having to carry a balance and pay interest for the month. Moreover, although they advertise same day payments via the Click-to-Pay program:

"Only those payments that are received before 1PM Eastern on a bank business day will be applied the same day."

When I called to inquire, I was told that they'd be happy to take my payment over the phone and to apply it immediately – but only if I was willing to pay a $14.95 service fee. This latter point isn't that surprising. Most credit card issuers charge for phone payments. But I wasn't expecting an arbitrary (and unnecessarily low) limit on the amount I could pay during the first month.

The bottom line here is that, if you have one or more Citi cards, you might consider enrolling in the Click-to-Pay program right now, such that the enrollment period limitation will have expired by the time you need to use it. Obviously, another alternative would be to set up your Citi account to 'pull' funds from your bank account rather than using your bank's billpay service to 'push' the money to them. Chase allows you to set this up online, and it's really quite flexible. You can opt to pay the minimum due, a set amount, or the full balance automatically each month. The problem is that Citi doesn't make this option available online. I've heard that you can write to Citi to get this set up, but I haven't yet had a chance to investigate it.

I guess those generous reward perks come at a price... To help foot the bill, they throw in a few extra gotchas to encourage late payments and/or carrying a balance.

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"A Small(ish) Citi Gotcha" was first published at fivecentnickel.com