A new concept of the credit card would allow cardholders to pay and accumulate credit on their biggest monthly expense: rent.
Bilt Technologies Inc., a real estate startup, is partnering with Evolve Bank & Trust and Mastercard Inc. to launch a credit card designed for tenants. Users can accumulate reward points through rent and other expenses, with no fees charged to the tenant or landlord when paying rent to the card, according to Bilt.
The reward points can then be used for rent and other purchases, even for a down payment on a house. âWe believe paying rent should increase your credit score because it’s your biggest responsibility,â said Ankur Jain, founder of Bilt.
Many landlords already accept credit cards, but they usually pass the handling fee on to tenants, which often adds up to around 3%. For landlords who don’t accept plastic, Bilt says it will send paper checks to landlords in the tenant’s name and then debit the tenant’s credit card account, at no charge.
The partnership can afford to offer rent payments at no charge because of the fees that Evolve and Mastercard will collect from all other types of spending on the card, according to Bilt. The card program also tries to incentivize spending other than rent by increasing the rewards for rent when cardholders spend more on everything else. Mastercard declined to comment on how it would take advantage of the no-charge card on rent payments.