Are You Aware of All the Charges Associated with Your Credit Card?

Updated on: 02 Jan 2024 // 4 min read // Credit Cards
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Many people swear by a Credit Card; after all they are convenient and safer to carry out when compared to cash. These cards are a reliable companion when it comes to travelling, and they are widely recognised and accepted online as well as by all kinds of stores. But, there is a catch when you use these Credit Cards. These exist in the form of charges. You need to be vigilant when using Top Credit Cards, or else there is a chance that you can get overcharged.

To ensure this does not happen, being aware of all of the charges associated with a Credit Card is imperative. Here is a list of the costs and fees that you will incur as a Credit Card user.

Annual Fees and Joining Fees

Some Credit Cards are available free of cost while there are certain cards (especially the ones that come with more significant benefits and rewards) that come with joining and annual fees. Joining fees refer to the initial fees that are charged for availing a Credit Card.

After a year, paying a yearly maintenance fee is also a prerequisite. In some instances, mainly when you spend up to a specific limit set by the bank, these charges are not applicable.

Cash Withdrawal Charges

You can withdraw cash from ATMs with the help of a Credit Card. However, make sure you use this facility only during emergencies. Card issuers may not tell you this in advance, but there are transaction charges applicable every time you withdraw cash with a Credit Card. These charges can be very high, i.e., at least 2.5% of the amount withdrawn.

Late Payment Fees

As the name suggests, late payment fees refer to any delay in payments that occur past the due date. The card issuer can charge you anywhere from 100 to 800. It all depends upon the amount outstanding on the card, days of delay, and the charges of the Credit Card company. The specifications of the fees applicable are put forth by the Reserve Bank of India.

Cash Processing Fees

If you are considering clearing all your outstanding dues by making a card payment in cash at an ATM, you also have to pay additional fees known as cash processing fees. All Credit Cards come with this fee, so there is no turning away from it.

Interest and Finance Charges

To pay for all spends, a majority of the Credit Card companies come with a 50-day interest-free period. No matter what the place and time of the card swipe, there are some premium cards that come with finance charges. After the interest-free period goes by, banks charge an interest or finance charge, especially if the customer fails to make the entire payment.

Foreign Currency Transaction

You have to pay a pre-determined fee for every transaction if you make any purchase online and the currency used is Indian Rupees. The pre-determined fee levied depends upon the amount. Generally speaking, this foreign markup fee is charged whenever a Credit Card is used for foreign transactions. The transaction can be either at a point of sale or online. You can steer clear of these charges by getting a travel card or carrying enough cash when abroad.

Duplicate Statement Fees

Usually, monthly statements are sent over to your address free of cost. However, whenever you request a duplicate statement, your Credit Card issuer charges a duplicate statement fee. This charge is fixed and does not alter depending upon other factors.

Outstation Cheque Fees

If you are making a Credit Card payment with the help of an outstation cheque, the card issuer levies an additional service fee known as the outstation cheque fee on the customer.

Card Replacement Fees

If you lose your Credit Card, obviously you have to replace it. In this scenario, your Credit Card issuer levies card replacement fees, and you will be liable for it.

When you Apply for Credit Cards, conducting thorough and precise analysis is essential. This helps you pick the best Credit Card for yourself. Refrain from using these cards wherever you go and see that you pay your Credit Card dues on time. Do not go above and beyond the card limit and stay well versed with the current and upcoming charges associated with cards. Being alert certainly helps you avoid any unknown charges levied upon you when it comes to your card.

Also Read: Should You Get an Add On Credit Card for Your Child?

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