How to Manage Late Payment Fee Hike on Your Credit Card?

Updated on: 24 Apr 2024 // 4 min read // Credit Cards
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Do not be late in paying your Credit Card bills. Pay them on time and never incur any late payment fee. Sometimes, circumstances can force you to make a late payment. Let us look at such instances and share tips about how to manage the late payment fee hike on your Credit Card.

  • You received the e-statement on your email, but may have ignored the message.
  • You opted to receive hard copies of the bill by snail mail, and it did not reach you by the due date.
  • You paid the bill online on the due date. However, it may have taken a couple of days for the statement to reflect the credit.
  • You forgot to pay the bill on the due date.
  • Last but not least, you have missed the payment because of lack of funds in your account.

Tips to Handle the Late Payment Fee on Your Credit Card Statement

Negotiate for a Waiver

You can always request the bank to waive your late payment fee on your Credit Card payment, especially if it was for the first time. You make your payments on time and have a good record of repayment. Banks would consider such requests favourably, especially if the delay were for a short period of a day or two. You have to call the hotline number and place your request. It is advisable to be firm, and not demanding in any way. Remember, the waiver is not a matter of right. Do not give up easily.

Change Your Billing Cycle

All Credit Cards have to adhere to specific billing cycles. Some cards have a due date that falls on the 15th of the month whereas you have Credit Cards that fall due at the end of the month. Check which of the dates is favourable to you. Do you receive your salary on the 25th of the month? Under such circumstances, it is better to settle for a due date that comes after your salary date. You would not miss the payment because of lack of funds. Explain your difficulty to the bank. Usually, they cater to such requests, if they find it genuine.

Set Up a Separate Account for the Credit Card Payment

Have a separate account for debiting your Credit Card bill payment. Remember to fund the account in advance. Register your standing instructions with the bank to debit the account automatically for the amount of the Credit Card bill. Set the date a couple of days in advance of the due date. In this way, you will never miss any payment. Specific banks offer a higher rate of interest on such special savings accounts. You can fund the account in time and avail the benefit of a higher rate of interest as compared to the regular savings accounts.

Points to Note:

  • Notice of the Late Payment Hike: The bank has to give you adequate notice of the late payment hike. Refer to the terms of the Credit Card agreement. The agreement provides you with information about the channels that banks use to inform you of any changes in the terms and conditions. The late payment fee hike is a change in the accepted conditions. Hence, you have a right to be aware of this fact.
  • Check Out for Other Credit Cards: The late payment fee structure differs from bank to bank. If you feel that your bank has hiked the late payment fee by a substantial amount, you can explore the possibilities of applying for new Credit Cards. Check out MyMoneyMantra and Find a New Credit Card Online that does not charge as much as your current Credit Card.
  • Pay the Minimum Amount Due on the Card: If you do not have funds in your account to clear your Credit Card dues, you can choose to pay the minimum amount due on the card. Do so before the due date, and you will not incur any late payment charges at all. However, you would have to pay interest on the Credit Cards balances from the next billing cycle onwards in case you choose to pay an amount less than the bill.

Today is the age of competition between various banks to gain supremacy in the market. Under such circumstances, banks resort to reduce the rates rather than increase them. If they have raised the rates, you can ask for a waiver, especially if you have a good record. Banks love to have good customers. Hence, they might agree to your request as an exceptional condition.

Also Read: Failing to Plan is Planning to Fail

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