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WASHINGTON — With more Americans struggling to pay for basic living expenses, a small but growing segment of the finance industry is encouraging consumers to pay their mortgages, car notes, student loans — and even alimony — online by credit card.

Those who pay their card charges in full each month may find that the practice provides a slew of card incentives while buying extra time to come up with the cash.

Paying recurring monthly bills with plastic, however, could drive the debt-ravaged consumers who may be tempted by the option deeper into debt and push the subprime loan crisis onto the credit-card industry.

"Given the current economic situation, we'd advise anybody who really depends on occasional credit to avoid this service because it's an accident waiting to happen," said Travis Plunkett, the legislative director of the Consumer Federation of America.

Using a credit card — which is essentially borrowed money — to repay borrowed money violates a basic tenet of financial well-being: never borrow from Peter to pay Paul.

Over the last year, however, the credit-card industry and a small group of entrepreneurs have been working to punch holes in that widely held wisdom.

For a fee of $4.95 per transaction and 2.3 percent of the bill amount, ChargeSmart, a new online bill-payment company headquartered in San Francisco, allows consumers to pay mortgages, auto loans and leases, student loans and utility payments by credit card.

ChargeSmart isn't targeting distressed borrowers, Chief Operating Officer Philip Mikal said. Of the 1,000-plus transactions that have been processed since the company launched in July, only 1 or 2 percent involved delinquent accounts, Mikal said.

Mikal said the bulk of ChargeSmart customers were savvy spenders who were looking to maximize their card-reward programs. Some use zero-interest-rate cards; some are salespeople or small-business owners with irregular incomes, who see ChargeSmart.com as a way to manage their cash flow better, Mikal said.

ChargeSmart's main competitor, BillCharger of New York, offered similar online services but also provided card payments for insurance premiums, rent, alimony, property taxes and other bills that traditionally don't accept plastic.

After launching in April as the "only service of its kind," BillCharger quietly suspended operations earlier this month "while we work on tweaking the business model," company founder Andrew Fisher said.

BillCharger's rocky start "is indicative of the challenges faced in bringing a new payment service to market," Mikal said.

He should know. Last year, Mikal co-founded CardIt, another startup that permitted mortgage payments by credit card. CardIt folded three months after its September debut because of funding problems.

American Express, which OK'd card payments of luxury rentals in 2003 and luxury condominium down payments in 2006, was the first card issuer to embrace mortgage payments when its Express Rewards Mortgage program began in May 2007.