Credit cards offer a lot of relief during tough financial situations. A credit card has its own responsibilities in addition to being a terrific way to make purchases and get rewards. Even though a bank might assert that the credit cards are free, customers must be aware that there are a few unstated fees associated with the cards.
When using a credit card, there can be additional fees. Not to worry. “If you’re proactive, you can completely avoid some of these, some of which might not even apply to your card. Travel, business, credit cards for people with bad credit, and reward cards for people with fair or limited credit are the most typical high-end rewards credit cards with annual fees, according to Amit Gupta, MD, SAG Infotech.
This typically means that the membership cost and annual expenses are taken off for the first 365 days, according to Vinit Khandare, CEO & Founder, MyFundBazaar. After then, the yearly maintenance price starts.
Before making a decision, he encouraged consumers to confirm whether the card is free for its entire life or simply the first year.
You can get cash from an ATM with your credit card. But, in accordance with the terms of your credit card agreement, you will be assessed a cash advance fee.
According to Vinit Khandare, using a credit card to withdraw money is subject to interest charges that start accruing at the time of the transaction and can reach up to 2.5 percent of the amount withdrawn.
There are also late payment penalties. If you do not make the minimum monthly payment, late payment fees may occasionally be charged to your account.
“Banks charge a flat fee when credit cardholders fail to pay the minimum due amount in time and late payments have a direct impact on the credit score. Additionally, only the payment of minimum due doesn’t solve the purpose,” said Vinit Khandare.
While most leading credit card providers have globally accepted cards, foreign transactions involve additional fees. A percentage of the transacted amount is converted into rupee and levied as the fee.
The foreign transaction fee charged by your credit card might be 3%. This is a standard cost that is charged for every overseas transaction you authorise on your credit card. You must pay a balance transfer charge if you need to move funds across accounts. Typically, the cost is a portion of the money you transfer, said Vinit Khandare.
