Melio is a B2B payment platform for small and midsize businesses in the U.S. Its functionality is somewhat similar to Plastiq: you can pay by credit card, and Melio then sends the money to your vendor by ACH, check, or wire. The credit card fee is usually 2.9%, making it a good fit for paying real business bills, meeting business credit card welcome bonus spending requirements, or temporarily extending your business cash flow.
There is currently a 90-day free offer for new sign-ups. You can choose the most expensive $80/month Unlimited membership, try it free for three months, and then switch back to the free version afterward.
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What Is Melio?
Many vendors only accept ACH, wire, or check, and are not willing to take credit cards directly. Melio basically adds a conversion layer in the middle, helping you pay vendor bills with a credit card:
- You upload a bill or enter payment information in Melio;
- You pay Melio using a credit card, debit card, or bank account;
- Melio completes the payment by ACH, check, or wire according to the vendor’s requirements.
The vendor does not need to register for a Melio account, as long as it can normally receive ACH, wire, or check payments. For example, inventory purchases, advertising, business rent, internet and phone service, accounting fees, legal fees, and 1099 contractor expenses may all potentially be paid through Melio. For credit card users, its main value is turning real business expenses that normally cannot be charged to a card into credit card spending. This can help meet welcome bonus spending requirements, earn some points, and even complete certain high-spending bonuses. In addition to U.S. recipients, Melio also supports payments to bank accounts in other countries via wire.
Compared with ordinary banks, Melio differs in the following ways. Overall, it is more intelligent and makes payments more convenient.
Melio Fees
Melio currently still offers the free Go Plan. The free version includes 5 free ACH payments per month, and after that each one costs $0.50. For credit card or debit card payments, the base fee is generally 2.9%. The fees for the free version are as follows:
| Payment method | Delivery method | Main fee |
|---|---|---|
| Bank account | Standard ACH | $0.50 after the free allowance is used |
| Bank account | Standard check | $1.50 |
| Credit card or debit card | ACH or standard check | 2.9% |
| Credit card or debit card | Expedited check or instant delivery | 2.9% plus additional fees |
| International credit card payment | Received in USD | 2.9% + $20 |
| International credit card payment | Received in foreign currency | 2.9% + Currency Conversion |
Fees for other account tiers are listed here:
Melio Payment Requirements
Melio’s core rule is that both the payer and the recipient must be connected to real business activity.
Eligible Payments
Common eligible payments include:
- Business rent, where the landlord or property manager is a business;
- Business utility, phone, internet, and similar bills;
- Software subscriptions and SaaS services;
- Inventory, raw materials, and purchasing costs;
- Advertising, marketing, and other operating expenses;
- Accounting, legal, and other professional services;
- Freelancers and 1099 contractors;
- Equipment maintenance and business services;
- Taxes;
- Employee reimbursements.
Small businesses, LLCs, corporations, and sole proprietors in the U.S. can all use it. For the first payment, you need to provide the business legal name, address, industry, business type, and tax ID. Melio accepts EIN, SSN, and ITIN, but an SSN or ITIN usually corresponds to applicable business types such as a sole proprietor.
Melio may also request additional documents such as business registration, DBA, Schedule C, sales tax filing, business bank statements, or business utility bills. Having an EIN alone does not necessarily mean you will pass verification. The platform will also evaluate whether the business activity and the specific payment are genuine and reasonable.
Payments You Cannot Make
The following payments are explicitly prohibited by Melio or are very likely to trigger risk controls:
- Personal living expenses;
- Personal tuition or other expenses unrelated to a business;
- Paying one credit card with another credit card;
- Using a credit card to pay a loan or mortgage;
- Transferring money from a credit card to yourself;
- Paying another company you control or have an ownership interest in;
- Transferring money to family members or other related parties;
- Payroll, although normal freelancer and 1099 contractor payments are allowed;
- Using prepaid cards such as Visa, Mastercard, or AMEX gift cards;
- Fake invoices or payments with no actual goods or services.
Pay special attention to “paying a company you control.” Melio explicitly treats credit card payments to the business owner personally, payments from the owner to their own business, or payments to another business in which the cardholder has an ownership interest as prohibited transactions similar to cash advances. So this is not a tool where you can simply register two LLCs and move money back and forth between them.
Which Credit Cards Can You Use?
Melio currently supports American Express, Visa, Mastercard, and Discover, but there may be additional restrictions depending on the card network and payment category.
AMEX cannot necessarily be used for every vendor type. Whether a payment can actually be completed depends on the industry category and card network rules. International credit card payments currently support only Visa and Mastercard, not AMEX or Discover.
If you plan to pay a relatively large bill, I recommend first making a smaller real payment to confirm the following:
- Whether Melio approves this type of bill;
- Whether the credit card transaction posts normally;
- Whether the vendor receives the payment correctly;
- How many business days the payment takes;
- Whether the invoice number or memo displays correctly.
After confirming that the entire process works properly, you can then schedule large bills or bills close to the due date.
Is the 2.9% Fee Worth Paying?
If you are only trying to earn the usual 1x or 2x credit card points, paying a 2.9% fee long term is generally not worth it. For example, if you use a credit card to pay a $10,000 bill:
- Melio fee: $290;
- 1x credit card earnings: 10,000 points;
- Even at 1.5 cents per point, those points are worth only about $150.
In this case, you are effectively spending $290 to buy roughly $150 worth of points, which is unnecessary. Melio is mainly suitable for the following scenarios.
Meeting a Large Welcome Bonus Spending Requirement
Some business cards require $10,000, $15,000, or even $20,000 in spending within three months. If your normal business spending falls just short, you can route vendor bills you already need to pay through Melio.
In this situation, you should not compare only the credit card points with the 2.9% fee. Instead, consider whether this spending helps you earn the entire welcome bonus.
Completing High-Spending Bonuses
Some credit cards offer free night certificates, elite status, or other rewards after annual spending reaches a certain amount. If you are only a small amount short of the threshold, paying a 2.9% fee may be worth it.
Extending Business Cash Flow
Melio pays the vendor first, and you then repay the credit card when the statement is due. In theory, this lets you keep cash on hand for a bit longer. For people who are actually running a business, this can sometimes be more valuable than the credit card points themselves.
However, you still need to pay the credit card balance in full when it comes due. If you end up paying credit card interest for long-term short-term financing, the strategy loses its purpose completely.
Melio Risk Controls
Based on data points from users over the past few years, Melio’s risk controls are indeed quite strict:
- Some people had their accounts closed just a few hours after signing up;
- Some people had their accounts closed because a payment was deemed not to be for business use;
- Some people tried to pay personal tuition, and after the transaction failed, their accounts were deactivated;
- Some people used it purely to manufacture spending, and their payments were canceled;
- There are also users who run real businesses and pay normal vendor bills over the long term without running into problems.
Melio’s official website also clearly states that payments may be declined due to non-business transactions, fraud risk, or insufficient business information.
So what truly determines whether an account can be used long term is not whether you have an EIN, but rather:
- Whether the business actually exists;
- Whether the payment corresponds to real goods or services;
- Whether the vendor and payment amount are reasonable;
- Whether you can provide invoices and business documents when needed;
- Whether there is a suspicious relationship between the payer and the recipient.
In other words, if you have sufficient documentation to show that your business activity exists, Melio can still be a viable way to use credit cards over the long term.
How Is Melio Different from Plastiq?
Melio and Plastiq are very similar in their basic logic: you pay by credit card, and then the platform pays the recipient by ACH or check. However, Melio places more emphasis on B2B use cases, and both the payer and recipient must be related to real business activity. Its tolerance for personal bills, related-party transfers, and transactions that look like cash equivalents is very low.
If you are simply looking for a platform that can pay all kinds of personal bills, Melio is not a complete substitute for Plastiq. But if you already have a real business and need to pay vendors, advertising expenses, inventory costs, or contractor fees, Melio is actually a better fit for its original product positioning.
