diff --git a/app/controllers/api/v1/customers/payment_methods_controller.rb b/app/controllers/api/v1/customers/payment_methods_controller.rb
index ab70e326f9c..ed8d4389143 100644
--- a/app/controllers/api/v1/customers/payment_methods_controller.rb
+++ b/app/controllers/api/v1/customers/payment_methods_controller.rb
@@ -10,11 +10,32 @@ def index
           payment_method_index(external_customer_id: customer.external_id)
         end
 
+        def set_as_default
+          payment_method = customer.payment_methods.find_by(id: params[:id])
+          return not_found_error(resource: "payment_method") unless payment_method
+
+          result = PaymentMethods::SetAsDefaultService.call(payment_method:)
+          if result.success?
+            render_payment_method(result.payment_method)
+          else
+            render_error_response(result)
+          end
+        end
+
         private
 
         def resource_name
           "payment_method"
         end
+
+        def render_payment_method(payment_method)
+          render(
+            json: ::V1::PaymentMethodSerializer.new(
+              payment_method,
+              root_name: "payment_method"
+            )
+          )
+        end
       end
     end
   end
diff --git a/config/routes.rb b/config/routes.rb
index 7f4c29ec8d8..37af58cbbcf 100644
--- a/config/routes.rb
+++ b/config/routes.rb
@@ -43,10 +43,12 @@
           resources :credit_notes, only: %i[index]
           resources :invoices, only: %i[index]
           resources :payments, only: %i[index]
-          resources :payment_methods, only: %i[index]
           resources :payment_requests, only: %i[index]
           resources :subscriptions, only: %i[index]
           resources :wallets, only: %i[index]
+          resources :payment_methods, only: %i[index] do
+            put :set_as_default, on: :member
+          end
         end
       end
 
diff --git a/spec/requests/api/v1/customers/payment_methods_controller_spec.rb b/spec/requests/api/v1/customers/payment_methods_controller_spec.rb
index 4066afe1fc9..69f1549080f 100644
--- a/spec/requests/api/v1/customers/payment_methods_controller_spec.rb
+++ b/spec/requests/api/v1/customers/payment_methods_controller_spec.rb
@@ -3,13 +3,14 @@
 require "rails_helper"
 
 RSpec.describe Api::V1::Customers::PaymentMethodsController, type: :request do
+  let(:customer) { create(:customer, organization:) }
+  let(:organization) { create(:organization) }
+  let(:external_id) { customer.external_id }
+  let(:payment_method) { create(:payment_method, customer:, organization:) }
+
   describe "GET /api/v1/customers/:external_id/payment_methods" do
     subject { get_with_token(organization, "/api/v1/customers/#{external_id}/payment_methods", {}) }
 
-    let(:customer) { create(:customer, organization:) }
-    let(:organization) { create(:organization) }
-    let(:external_id) { customer.external_id }
-    let(:payment_method) { create(:payment_method, customer:, organization:) }
     let(:second_payment_method) { create(:payment_method, organization:, customer:, is_default: false) }
 
     include_examples "requires API permission", "payment_method", "read"
@@ -54,4 +55,78 @@
       end
     end
   end
+
+  describe "PUT /api/v1/customers/:external_id/payment_methods/:id/set_as_default" do
+    subject { put_with_token(organization, "/api/v1/customers/#{external_id}/payment_methods/#{payment_method.id}/set_as_default") }
+
+    include_examples "requires API permission", "payment_method", "write"
+
+    context "with unknown customer" do
+      let(:external_id) { SecureRandom.uuid }
+
+      it "returns a not found error" do
+        subject
+
+        expect(response).to have_http_status(:not_found)
+        expect(json[:code]).to eq("customer_not_found")
+      end
+    end
+
+    context "with unknown payment method" do
+      subject { put_with_token(organization, "/api/v1/customers/#{external_id}/payment_methods/invalid/set_as_default") }
+
+      it "returns a not found error" do
+        subject
+
+        expect(response).to have_http_status(:not_found)
+        expect(json[:code]).to eq("payment_method_not_found")
+      end
+    end
+
+    context "when payment method is already default" do
+      let(:payment_method) { create(:payment_method, customer:, organization:, is_default: true) }
+      let(:payment_method2) { create(:payment_method, customer:, organization:, is_default: false) }
+      let(:payment_method3) { create(:payment_method, customer:, organization:, is_default: false) }
+
+      before do
+        payment_method
+        payment_method2
+        payment_method3
+      end
+
+      it "returns valid payment method" do
+        subject
+
+        expect(response).to have_http_status(:success)
+        expect(json[:payment_method][:lago_id]).to eq(payment_method.id)
+        expect(json[:payment_method][:is_default]).to eq(true)
+        expect(payment_method.reload.is_default).to eq(true)
+        expect(payment_method2.reload.is_default).to eq(false)
+        expect(payment_method2.reload.is_default).to eq(false)
+      end
+    end
+
+    context "when payment method is not default" do
+      let(:payment_method) { create(:payment_method, customer:, organization:, is_default: false) }
+      let(:payment_method2) { create(:payment_method, customer:, organization:, is_default: true) }
+      let(:payment_method3) { create(:payment_method, customer:, organization:, is_default: false) }
+
+      before do
+        payment_method
+        payment_method2
+        payment_method3
+      end
+
+      it "sets payment method to default and returns valid payment method" do
+        subject
+
+        expect(response).to have_http_status(:success)
+        expect(json[:payment_method][:lago_id]).to eq(payment_method.id)
+        expect(json[:payment_method][:is_default]).to eq(true)
+        expect(payment_method.reload.is_default).to eq(true)
+        expect(payment_method2.reload.is_default).to eq(false)
+        expect(payment_method2.reload.is_default).to eq(false)
+      end
+    end
+  end
 end