Charges on credit cards

If you are in the habit of using your credit cards for most of your payments or withdrawing cash using your credit cards, but if you do not have the habit of paying your credit card bills on time, you are coughing up lot of money on paying fees, interest, penalties and other charges levied on the outstanding amount of your credit card. So, spare some time and get to know all the charges you are paying to make the credit card guys a happy lot.

Late payment fee: The bank charges late payment fee if you do not pay up the minimum amount on or before the due date of the bill. The late payment charges differ from bank to bank and can range from Rs 100 to Rs 1,000, depending on the outstanding bill amount.

Revolving credit charges:The amount remaining outstanding after payment of minimum amount is the revolving credit facility extended to you.The rates of interest levied on revolving credit are quite high, ranging from 24% p.a. (2% per month) to 42% p.a. (3.5% p.m.). So, avail revolving credit facility only if you must, and not because you want to avail it just for the heck of it.

Cash withdrawal charges: The amount withdrawn from an ATM through a credit card attracts cash advance charges at the rate of 2.5% to 3% of the amount withdrawn, subject to a minimum amount of Rs 300 to Rs 500, depending on the bank.

Credit overlimit fee: If you exceed the credit limit on your card, the bank will charge a credit overlimit fee, which may be at the rate of 2.5% to 3% of the overlimit amount, subject to a minimum of Rs 300 to Rs 500

Cash processing fee: If you pay your bill amount by depositing cash at the ATM or a bank branch, some banks levy cash processing fee, which may be up to Rs 100 per such payment.

Cheque dishonour charges: If you pay your credit card bill amount by cheque and if your cheque gets dishonoured due to some reason, the bank will levy cheque return charges, which can be 2% of the payment amount, subject to a minimum of Rs 300 to Rs 500 per cheque.