Five Credit Card Charges You Should Know About

Latest News

Clarification on deletion of name of daughter from the family details of a Central Government pensioner

View All >>

7th pay commission

7th Pay DA : जाने कितना बढ़ा महंगाई भत्ता

Good News For Central Govt Employees, Salary to Increase Up to THIS Amount
केंद्रीय कर्मचारियों का बंपर फायदा- ₹56,000 की बेसिक सैलरी पर DA बढ़कर होगा 2,08,320 रुपए, जानें कैलकुलेशन
दोगुनी होगी पेंशन! हटने वाली है 15000 रु की लिमिट? जानिए अब कितने मिलेंगे रुपये
महंगाई भत्ते के बाद अब बढ़ सकता है फिटमेंट फैक्टर, जानिए फिर कितनी हो जाएगी केंद्रीय कर्मचारियों की सैलरी!
केंद्रीय कर्मचारियों का फिटमेंट फैक्टर बढ़ेगा? 2.57 से बढ़कर 3 हुआ तो कितनी बढ़ेगी सैलरी
मप्र लिपिक वर्ग की वेतनविसंगति कब दूर होगी: कर्मचारी संघ
मनचाहा तबादला कर्मचारी का अधिकार नहीं: सुप्रीम कोर्ट –

view all>>

Allowances

Good News – Dearness Allowance (DA) Increased from 1 July 2024

view all>>

Central Govt

Clarification on deletion of name of daughter from the family details of a Central Government pensioner

view all>>

Five Credit Card Charges You Should Know About

May 18, 2018, 11:32 AM

Having a credit card is a must today. Most of our payments happen digitally. One needs to have a credit card to transact online and make the most of e-commerce deals.

Moreover, a credit card is also your backup in a cash crunch. Modern day credit cards come with various sops such as life insurance, accidental cover, accumulation of air miles over spends , airport lounge access, and cash back options on spends or rail reservations etc.

However, what is generally ignored is the fact that credit cards aren’t free. They do have charges – some well-known, others not no well-known. The little-known charges need to be understood to avoid penalties, heavy interest rates, and excess payment charges later on.

Here is a lowdown on five lesser known credit card charges.

ATM Withdrawals

The credit card comes with the advantage of cash withdrawals from ATMs. But this service is not free and a transaction charge around 2.5% of the cash advance is applicable. An interest on the cash from the date of withdrawal will be levied ranging from 24% to 46% per year. This must always be used as the last resort. Also, cash withdrawals are attract interest immediately unlike other credit card transactions for which there is an interest-free period of 40-50 days.

Annual Maintenance Charge

When you buy a credit card, always be clear about the annual charges. Sometimes, these may be waived off fully or for a limited period. Usually, a free credit card is offered without this charge. For some cards, the charge may be applied from the second year. Always be aware of these charges, and whether they’ve been waived off for you.

Interest Charge
A credit card bill displays the total amount that is due, and the minimum payable amount – typically 5% of the total dues. A lack of understanding of both these charges has the potential to land you in a debt trap.

Many people often pay only the minimum payable amount and leave the rest pending. It is important to note that a 2% to 4% interest rate is applied per month on the remaining amount, and the monthly rate of interest is annualised to arrive at an APR or annualised percentage rate of 36% to 38%, which is extremely high for any loan.

This annualised percentage rate combined with nominal rate of interest can result in a huge financial burden. Therefore, always pay your credit card bill in full and on time every month. If you’re unable to do so, pay off the debt in the shortest period possible to avoid heavy interest charges.

Late Payment Charges

You will be penalized for a late credit card payment. This comes into force when the customer defaults over the monthly credit card due payments after the due date. A flat late payment charge is levied and is not dependent on the interest charges.

GST Rates

Before GST, the Service Tax levied on credit card-related services was 15 per cent. After GST, this increased by 3 per cent and the credit card companies now charge 18 per cent. You should be aware that after GST, interest or late payment charged would be taxed at a higher rate.

Although, credit cards empower us to meet our urgent money needs, it is important to understand all the charges before we procure and start using one.

Source: BT

Railway Employee (App)

Rail News Center ( App)

Railway Question Bank ( App)

Railway Mutual Transfer

(App)

Information Center ( App)

Disclaimer: The Information /News /Video provided in this Platform has been collected from different sources. We Believe that “Knowledge Is Power” and our aim is to create general awareness among people and make them powerful through easily accessible Information. NOTE: We do not take any responsibility of authenticity of Information/News/Videos.

This entry was posted in Central Govt Miscellaneous, State Employee