14 HIDDEN CHARGES OF CREDIT CARD

Getting a credit card seems to be very profitable but that is not true always. Before getting a credit card you must know about the hidden charges that you have to pay if you will not use a credit card in a profitable manner. There are many things that you should follow while getting a credit card and using a credit card. Getting a credit card is profitable only when you are using it properly with knowing all its advantage and disadvantages. Today in this blog we will discuss the hidden charges that you have to pay while using a credit card, so you should know these charges before buying a credit card.

14 Hidden Charges of Credit Card

14 Hidden Charges of Credit Card

1) Late Payment Fees

it a fine that you have to pay, If you do not pay your credit card bills on time then you have to pay a late fee fine. You have to pay your credit card bills within 30 days(time period defined) and if you fail to do so, then you have to face a penalty. The Cost of penalty lies between Rs 300 to Rs1000(defines by the company).

2) Cash Withdrawal Fees

The Credit Card is not good for cash withdrawal. The Credit Card companies charge 2 to 3 percent of the withdrawal amount as fees if you withdraw cash from ATM machines, this interest rate will start to apply on the same day of withdrawal. For example, if the credit card company is charging 2 percent on cash withdrawal then and you withdraw 1 thousand rupees then you have to pay interest of 20 rupees.

3) Interest Charges

The interest charge is one of the major hidden charges that is taken by credit card companies. Interest charged by credit card companies lies between 2 to 4 percent per month. For example, if the credit card company is charging 3 percent interest per month it means that they are charging the rate of interest of 36 percent per annum. You also have to pay this interest on the due amount in case you aren’t able to pay the due amount. You also even have to pay interest on late payment charges.

4) GST

One has to pay the GST of 18 percent on the additional charges like late fees payment charges, cash withdrawal charges, and interest charges. If you are taking a loan from a bank you don’t have to pay GST on the interest but not in the case of the credit card.

5) Annual Fees

You have to pay annual fees to the credit card to the credit card companies. Many credit card companies do not ask for the annual fees in the first year but from the next year, you have to pay the annual fees. The annual fees of the credit card lie between 250 rupees to 2000 rupees. So choose the credit card which provides you the maximum benefits.

6) Over Limit Charges

If you exceed the limit of your credit card then also the credit card companies charge you 2 to 4 percent of the money spent beyond the limit. For example, if the limit of your credit card is 50 thousand and the company is charging 3 percent of the money spent beyond the limit and your expenditure is 60 thousand then you have to pay the 3 percent as charges on the extra 10 thousand spent which means you will be charged 300 rupees.

7) Cheque Bounce and Auto-Debit Reversal

On every check bounce or auto-debit reversal, you have to pay a fee of 200 to 500 rupees depending upon your credit card company.

 8) Foreign Currency Transaction Fees

In a foreign currency transaction, you have to pay a fee that lies between 3 to 4 percent depending upon the company of the credit card.

9) Fuel Transaction charges

The credit card companies also charge 1 to 2.5 percent of charges if you are using the car for getting fuel for the vehicles. Some of the credit card companies wave off this charge. So must read the terms and conditions of the credit card carefully.

10) Railway Ticket Booking and Cancellation Super Charge

The government charges a fee when you use a credit card for the booking of railway tickets. and on the cancellation as well you will be charged some money. This fee lies between 1.5 to 3.5 percent of the transaction.

11) Charge on Card Lost/ Card Damage/ Card been Stolen

The Credit Card companies also charge you for the issuing of the new card in case you lost your card, damaged your card, or your credit card has been stolen. This fee approximately lies between 100 to 200 rupees.

12) Credit Card Statement Charges

In order to get a certified statement of your credit card which is 6 months or 12 months or more than 12 months older then the Credit card companies charge you a fee which will lie between 100 to 200 rupees. Instead of getting a certified statement getting an online statement is a better option as you don’t have to pay a single penny to get the online statements of your credit card.

13) Paying Bill with the use of cash

Most credit card companies want their customer to pay the bill using an online payment method. So some credit card companies charge you for paying the credit card bill by visiting the branch and paying through cash in order to promote the online payment method. This fee can lie between 100 to 200 rupees.

14) Outstation Cheque Charge

Some banks charge you a fee when you use an outstation cheque for the payment of the credit card bill. This fee can lie between 50 to 200 rupees. Most of the credit card companies wave off this charge.

So these are 14 hidden charges that a credit card user can experience. Must read the terms and conditions of the credit card carefully and choose your credit card wisely to save the maximum amount of money. Share it with your friends and family who are using credit cards or planning to get a credit card.

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