Credit Card Hidden Charges Banks claim that credit cards are free, whereas users should understand that there are some charges associated with the card which many times users are not aware of and they keep paying the charges unknowingly.
Credit cards come in handy when money is a problem. Apart from this, it also gives shopping and reward points. Many times banks claim that credit cards are free, while users should understand that there are some charges associated with the card, which many times users are not aware of and they keep paying the charges unknowingly. Knowing about these charges, customers can use their card wisely. Let us know what are those charges that customers should be aware of.
Maintenance Charge
Many banks offer free credit cards. This usually means that the joining fee and annual fee are waived for the first 365 days. After that, the annual maintenance fee starts. Know about it before buying the card.
Late Payment Charge
When credit cardholders are unable to pay the minimum due amount on time, a late payment has a direct impact on the credit score, for which banks charge a similar fee. Credit cards charge double-digit interest on the outstanding amount as well as subsequent charges, which do not take advantage of the interest-free period until the full amount is paid.
Charge Over Limit
There is a cost to be paid for spending over a limit on a credit card. Whether the users crosses the limit of Re 1 or Thousands, the excess of the account will attract a minimum charge of Rs 500 or more depending on the bank.
Cash Advance Fee
You can also withdraw money by going to an ATM with a credit card, but it is not cheap. Withdrawing cash from a credit card attracts interest from the time of the transaction and can be as high as 2.5 percent of the amount withdrawn.
GST Charge
All credit card transactions are subject to GST, charged at 18 percent of the credit card fee.
Surcharge
Certain facilities such as petrol or railway tickets, when purchased with a credit card, attract additional charges on a percentage of the transaction.
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