Credit Card Charges: With the coming of demonetisation in the economy, the government has been making constant efforts to push the country towards a cashless society. The use of digital platforms has increased for making transactions. It seems very convenient to pay through credit cards, however, to avail these services, the banks makes you pay many charges as well.
Some of these charges are not known by the customers, the knowledge of these charges is a must for all credit card holders. Here’s a list of credit card charges that you should be aware of.
Important Credit Card Charges that one must be aware of before getting a credit card
Annual fees
Mostly, banks tell their customers that no annual fee is charged by them, which makes more and more individuals opting for their credit card service. However, this is only for the beginning. After the first year, many banks start charging and annual fee starting from Rs 200. Many banks also charge a joining fee.
Service Tax
The banks also charge a service tax as high as 14 percent which is applicable on fees, interest and some other charges.
Revolving Interest Rate
The payment due has to be made before a set date. In case the payment is not made on time, the bank will charge a revolving interest rate every month after the due date. This rate ranges from 1.99 percent to 4 percent. This is one of the major factors that should be taken into account and one must not miss the due payment date. Revolving int. rate is one of the highest charges levied on credit card holders.
Extra Charges Levied after Card Limit Exhaustion
After you exhaust the threshold limit of the credit card, the amount withdrawn after will be charged at a higher rate. It is thus advised not to withdraw excess amount once the credit card limit is exhausted.
Charges levied on late payment of money
The banks levy high charges for the late payment of money. This rate mainly depends on the time duration after which the money is paid once the due payment date passes and the amount of money. The rate may vary based on these two factors. It should also be kept in mind that frequent delays in payment of money affect the credibility of the credit card holder badly and it may lead to denial of the loan in future or cancellation of the credit card.
Outstation Cheque Fee
When the credit card holder makes use of the outstation cheque fee, a service charge is levied by the bank. The service charge rate is fixed by the banks.
Foreign Currency Transaction Charges
When you make the payments online, is the payment made is in a foreign currency, a higher charge will be levied. This is because the conversion of the foreign currency to the domestic currency rates are included when the payment in a foreign currency is made.
Cash Withdrawal Charges from ATMs
When the credit card holder withdraws cash from an ATM, whether that of the credit card issuing company or any other bank, an extra charge will be levied on the amount withdrawn.
Duplicate Credit Card Issuance Charges
Many banks charge a fee when a duplicate credit card is issued to the customer. One should enquire about it beforehand.
Individual intending to get a credit card must do ample research regarding the best credit card offers provided by various banks. It is advised to pay heed to the guidelines on the issuance of the credit card and abide by them in order to avoid higher charges in future. The credit card bills must be paid on time and the credit card holder must keep and an account of the expenditure done in a given time duration.
