Insight on credit card charges!
Always good to stay updated
There are many charges associated with Credit Cards. All card holders may not have to pay all charges and also most of them are very nominal. Here goes the list of credit card charges:
Joining and Annual Fees: Joining fee is what you pay when you get a new card. This will be a recurring fee you pay every year to use your card. Sometimes, banks waive both these fees.
Interest charges: The interest charges are on a daily basis, ranging between 1.7% per month to 3.5% per month. The interest is charged on any outstanding amount of the credit card bill if it is not paid within the due date.
Late payment charges: When you do not pay your dues on time, you are charged late payment charges. This is either a percentage of the minimum amount due (usually 30%) or a flat amount which depends on the amount outstanding. This is in addition to the interest charges you pay.
Cash withdrawal charges: When you withdraw cash against your credit limit, you are charged a cash withdrawal fee, which is either in the form of a percentage of the withdrawal amount (usually 2.5%, subject to a minimum of Rs. 300) or a flat amount per transaction.
Payments related charges: The mode of repayment of dues determines the charges you pay. For instance, when you repay by cash, you are required to pay a flat fee (usually Rs. 100) as cash processing fee. When you pay by an outstation cheque, a percentage of the cheque amount (usually 1%) is charged.
Purchase of petrol and railway tickets: When you purchase fuel using your credit card, a fuel surcharge of 2.5% is charged, subject to a minimum value of Rs. 10. Some cards come with a feature of reversal of this charge when you use at specific petrol pumps. Another case when you have to pay extra is when you book railway tickets, ranging from 2.5% or 1.8% of the transaction value as the fee.
GST: Credit card usage is subject to GST, and all interest, charges and fees are subject to taxes.
Looking for Credit Card? Click here.