I am working on an app that'll be available to specific customers, after figuring out that this approach does not work, I am switching to pushing it to the public as a free app but give login credentials to specific users. Would that violate any of the subscription rules by android? would the app be taken down if people can't sign up, knowing I will charge for the account personally?
You can do this easily using Firebase Authentication. Here is the documentation for it. Just connect your app to Firebase, create login screen with Activity and create accounts with the usernames and passwords for your users and give them the credentials.
As for the Google Play billing policies, I believe this violates their rule that you should only get paid through Google Play so they get 30% of the income, however, if it all happens outside of the app, and there are no platforms to get paid through (like PayPal) integrated in the app itself, it shouldn't be a problem as far as I know.