Paypal bought the Tio bill pay service and shut them down

In July, PayPal announced that they had completed the purchase of the bill payment service Tio (formerly ChargeSmart).  Now, via Business Wire, it was reported that PayPal suspended Tio’s operations to protect Tio’s customers.  They wrote:

This suspension of services is a result of PayPal’s discovery of security vulnerabilities on the TIO platform and issues with TIO’s data security program that do not adhere to PayPal’s information security standards. TIO is not integrated into PayPal’s platform. The PayPal platform is not impacted by this situation in any way and PayPal’s customers’ data remains secure.

I haven’t written much about Tio in the past because their fees are much higher than Plastiq’s (a rival bill pay service which has not been shut down) and they don’t always allow payment with credit cards.  One advantage of Tio, though, has been the ability to pay some credit card bills through the service via debit cards.  Plastiq does not allow this.  Still, for most bills, Plastiq is a better option.

For details about Plastiq, including a handy chart showing the types of bills that can and can’t be paid, see: Complete Guide to Plastiq.

About Greg The Frequent Miler

Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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  1. “One advantage of Tio, though, has been the ability to pay some credit card bills through the service via debit cards. Plastiq does not allow this. Still, for most bills, Plastiq is a better option.”

    I don’t understand your thinking here. In the MS game, the goal to get rid of the debit cards (gift cards!) Is far more important than the ability to pay most bills.

    Or am I missing something?

    • your missing something. They’ll probably bring it back to life, but all its +’s will be gutted…….not that its really that useful anymore anyhow.

        • bluecoat, did you have any outstanding payments that hadn’t yet posted when the service was abruptly shutdown? Trying to find out if I’m the only one, haha… I assume there are many people that were screwed over and are now in mid-panic as I am….

        • To Tom (below), I’m happy to say all mine cleared just before this disaster. I’m sure you’ll be okay but you’ll just have to let it wind itself down….

          I had my calendar marked for the upcoming OD/OM GC sale but, without TIO, there is no easy way for me to get rid of these.

          P.S. to Greg: not sure you were aware, but TIO offered discounts to people who used their service a lot (or those who just asked for it).

          TIO was a thing of beauty while it lasted.

  2. There was definitely a very large volume of money being sent through the Tio bill pay service… obviously their margins were relatively thin, maybe a little more so than Paypal and Venmo, but this definitely was more than just a drop in the bucket… judging by how quickly the transaction numbers incremented after doing back-to-back transactions, there was definitely a lot of revenue coming in from this service. If their overall intention was to simply buy Tio and shut it down, then PYPL is going to have some serious explaining to do to their investors to account for the associated drop in revenue and the misleading statements that were made when they initially made the acquisition. That being said, I don’t think that is the case… hopefully they will bring the service back up sooner rather than later, but like someone else said, they will probably gut all of the benefits or raise the transaction fees to be more in line with Paypal (2.9% maybe?). Even though Tio had high fees, it was sometimes helpful for meeting minimum spend. It’s always good to have multiple options available, and it’s very disappointing to see a company take drastic action like this without any sort of warning whatsoever.

    Personally, I had thousands of dollars in pending bill payments that were in limbo when they shut the service down, and it’s been 4 days now and the payments still have not posted… I certainly hope this situation resolves itself soon, or this will likely get very messy, as I’m sure I’m not the only one that thousands of dollars in outstanding payments when the service was abruptly shutdown…

    • Also, as a side note, I’m inclined to believe them and take their word at face value when they say that it was shutdown due to security concerns. Up until about a month or two ago, every payment confirmation email contained the FULL account number of the account being paid, even if it was a credit card… which means your credit card was being sent over the internet via encrypted email… not exactly considered a best security practice. They fixed that recently, but if that was any indication, I suppose there must have been other vulnerabilities as well. Hopefully they can correct the issues soon and bring the service back up ASAP so we can continue printing free money for them!

  3. Wow, I knew you are an incompetent writer, but this article takes the cake. You provide ZERO evidence or sources about them shutting them down. This is worse than clickbait because you are incompetent at even providing some fake “corroboration” about your story other than a company discovering a security whole and suspending the service temporarily.

    Your conclusion from this to get a BOLD headline with zero to no knowledge other than some piece of update the company gave should tell you that you shut down this blog immediately.

  4. Dude, calm down, what is your problem? Everything he said is 100% accurate… for starters, you could try going to and you’ll see the message from Paypal that states exactly what is written in this article. If you take 30 seconds to google, you can also stumble across multiple other online news sources that corroborate this information.

    This is actually a very big deal… Paypal literally just shutdown the site with almost no explanation whatsoever… if it seems crazy to you, it’s because it is… and Paypal’s lack of any sort of detailed explanation is even more worrisome. You need to redirect your anger towards Paypal, because that is 100% where it deserves to be right now… no new communication since Friday… very unprofessional.

  5. Greg, do you use Tio very often and did you have any outstanding payments that hadn’t yet posted when the service was shut down? I had a few thousand pending when it was shutdown, and nothing has posted yet… very disconcerting. It would at least be nice if they would put a note on their site along the lines of “We will ensure that all pending payments will be processed within XX days” or something like that… put our minds at ease. But no. Paypal sucks. I might try calling that number tomorrow if my payments haven’t posted yet, cause this is kinda BS…

  6. Those with manufactured spending experience are amused at the inaccuracies about pricing in the article and in the comments. Hee!

  7. I’ve got a $2000 payment pending that I sent on 8-NOV, those usually clear within 3 days which would have been Friday…

    Calling the phone numbers listed will get you to a call center in the Philippines (based on the accents). They couldn’t provide any details on my transaction, nor could the Softgate systems people I was able to contact.

    Hopefully they’ll have some additional information soon, it’s ridiculous that they have not contacted customers with pending payments.

  8. People mourning the loss of Tio are not mentioning the more disturbing side of this story, Paypal’s continues it’s quest to be an online payment monopoly. First they killed the competition on E-bay, now buying potential rivals and ending them. They have no oversight and contribute to politicians just like Ticketmaster. Like ticketmaster once they have the market cornered they can raise rates and impose their arbitrary rules which include “because we say so”…they can freeze your funds for 6 months without recourse and raise rates to whatever they want if the customer has few to no alternatives. I refuse to use paypal with e-bay, and wont buy anything through paypal digital giftcards….too many horror stories. Congress busted AT&T and Microsoft up, but keep letting monopolies like paypal and ticketmaster abuse the public.

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