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Top 5 hidden credit card charges banks take from you
Monday, July 16, 2018 IST
Top 5 hidden credit card charges banks take from you

Having a credit card may prove to be good financially. A credit card helps an individual build his/her CIBIL score, which in turn helps in getting bank loans, among other things, with ease.
 

 
 

Having a credit card may prove to be good financially. A credit card helps an individual build his/her CIBIL score, which in turn helps in getting bank loans, among other things, with ease. Also, a credit card can become the best friend during a money crunch. Nowadays, a credit card is used everywhere; from airport lounge access, life insurance to railway reservation, these cards can turn out to be very helpful. But what people normally ignore is the fact that credit cards do not come for free. They do have charges; some are known to customers while others are hidden. The little-known charges need to be understood to avoid penalties, heavy interest rates, and excess payment charges later on.
 
– ATM Withdrawals:
 
Credit card apart from giving ‘credit’ to the customers also offer cash withdrawals from ATMs. However, this facility by banks does not come for free. A transaction charge of around 2.5 per cent of the cash advance is applicable. An interest on the cash from the date of withdrawal will be levied ranging from 24 per cent to 46 per cent per year. Also, cash withdrawals attract immediate interest, unlike other credit card transactions.
 
– Interest Charge:
 
A credit card bill displays the total amount that is due and the minimum payable amount – typically 5 per cent of the total dues. A lack of knowledge in the matter can land an individual in a debt trap. A lot of people only pay the minimum payable amount and leave the rest pending. Notably, around 2 per cent to 4 per cent interest rate is applied per month on the remaining amount. The monthly interest rate is annualised to arrive at an annualised percentage rate (APR) of 36 per cent to 38 per cent.
 
– Annual Maintenance Charge:
 
When an individual buys a credit card, s/he needs to be clear about the annual charges. Sometimes the annual fee is waived off for a limited period. In such cases, the charges are applied from the second year onwards.
 
 

 
 
 
 
 

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Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST


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