Often people start using credit card assuming that there is no charge. You will get a lot of information about attractive discounts and reward points on the credit card, but no one tells that if you do not pay attention, a credit card with many benefits can become the cause of loss. A credit card that offers things cheap can cost you dearly if you are not aware of the charges on it.
Some charges are levied on every card, while some are levied due to your ignorance. Some charges are not even mentioned by banks or agents. Here, know about such important charges.
This is the charge that different banks impose at different rates. There are many banks which do not charge this. Some banks who charge this, but if you use a credit card for more than a fixed limit, then they refund this fee. So if you take a credit card, first check that the bank is not charging it annually and if it is levying, then its policy should be to return the money after spending up to a certain limit. On the other hand, if the bank is charging an annual fee, then take that credit card only if you need it very much.
Interest on due balance
Although every bank imposes this charge, but only on those who do not pay credit card bills on time. That is, if you pay till the due date, otherwise a huge interest is charged on you from the credit card company. Keep in mind that even the non payment of minimum due cannot save you from huge interest. So always pay your credit card bill till due date, even if you have to take money from elsewhere, otherwise you can be charged up to 40% interest.
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Charge on cash withdrawal
Understand that every rupee spent on a credit card is a kind of loan. In such a situation, if you withdraw cash from credit card, then keep in mind that it will be charged from the day of withdrawal of cash. That is, if you shop with a card, then you have to pay money without interest till due date, but if you withdraw cash, then from the day of withdrawing it, the interest will be paid till the day of repaying the money. In such a situation, keep in mind that until all the routes are closed, do not withdraw cash from the credit card, otherwise there will be a huge loss.
Almost all banks charge surcharge on credit card. However, while issuing credit card, most banks make it clear that there will be a surcharge refund, but if the bank does not give such information, then make it clear from the bank. Most banks offer surcharge refunds only to a certain extent. It may be that you get surcharge refund on a transaction of at least 500 and maximum 5000 rupees. Also, you may get 100 or 200 a month or any other fixed amount from the bank as a surcharge. In such a situation, take full information about this charge before taking a credit card.
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Overseas transaction charges
Many banks include in their credit card’s features that you can use it in abroad as well. However, it needs to be noted that you also pay huge charges for using credit cards abroad, which the bank does not disclose. If you too are thinking of travelling abroad and plan to go and do some shopping with your credit card, then first make sure from your bank that how much it is going to charge you.