Santa Claus comes around just once a year. In the meantime, there are Credit Cards.
  • Reasons Why You Should Avoid Late Credit Card Payments

     

    Like every other line of credit/loan, credit card also has its fair share of pros and cons. On the one hand, it gives an individual the freedom to purchase without worrying about bank balance. However, failure to make timely payments of credit card dues can lead a person into a downward spiral of impending debt.

    There can be situations where the idea to delay credit card payment might seem well-suited, especially if there is a financial crisis. However, missing credit payments can bring, in addition to late payment penalties, ramifications severe enough to leave a long-lasting effect on the financial status. Given below are reasons why you should make every effort to avoid late credit card payments.

    • Late Payment Penalty
    • One of the reasons why no one should avoid late credit card payments is the stiff late fees charged by the banks and credit card companies. As per the RBI rules, the late fee is charged when a credit cardholder fails to clear off dues even after three days past the due date. The late fee is then added to the next cycle’s bill and can cost the cardholder a pretty penny.

    • Higher interest rate
    • If the payment for a credit card is due for more than 60 days, a penalty interest rate is usually levied by the credit card companies. Many credit card companies set this penalty rate as high as 30% to be charged on the outstanding bill amount. The increased interest is also charged on any new purchases or cash withdrawals – even after the credit card bill has been paid on time for six consecutive months.

    • Interest-Free period
    • If a customer pays just the minimum due or misses a payment, the outstanding balance gets carried forward. Once the rollover facility is used, the interest-free period lapses. Interest will be charged on the outstanding balance as well as subsequent purchases. The interest-free period is reinstated only once the entire bill is cleared in full.

    • Debt collection hassles
    • Credit card companies will leave no stone unturned to collect the dues once an account goes in collections for several months. They might also demand additional charges which, unfortunately, are not illegal.

      Not only credit card companies will repeatedly pursue the defaulter, but if a customer fails to pay despite companies’ constraints, the collection agency can mark the credit account on the credit report as a defaulting one.

    • Bad credit score
    • Every bank and financial institutions checks the credit score of an individual asking for a loan or applying for a credit card. The credit score determines a person’s worthiness as a borrower, i.e., someone who regularly clears monthly dues.

      A credit score calculation depends no less than 35% on whether the credit dues are paid on time. A consistent credit bill payment habit, along with the practice of paying off other dues, significantly boosts the credit score. Hence, if the payment history is not stable, it will directly affect the credit score since banks include these defaults in the credit information. As a result, chances of loan or credit card application getting rejected are always higher and so is the likelihood of getting a loan at an increased interest rate.

    • Deactivation of credit card
    • Even if the card is closed, you are still liable to pay the outstanding with interest. It's better to look at options of EMI or a personal loan to clear it off and pay a fixed rate of interest. Leaving the payment pending could result in the interest building up to more than the principal.

     

    How To Avoid Credit Card Late Payment

    Credit card late fees can, however, be avoided if one follows the ways mentioned below.

    1. Sign up for auto-pay
    2. Most banks offer auto-debit facility which automatically deducts money from the cardholder’s account on a specific date. Credit cardholders can sign up for this autopay facility which will reduce the chance of missing a payment due date. The only thing that one has to make sure is to keep sufficient funds in the bank account for the auto-debit to happen. This can be done by keeping a tab on the account balance on a regular basis.

    3. Set up reminders
    4. One more way to avoid missing credit due date is to set calendar reminders and online alerts for at least four to five days before the due date. These alerts and reminders will notify the cardholders promptly and help them avoid late payment and all the hassles associated with it.

    5. Make the payment in advance
    6. Depending on the method of payment, its important to consider the processing time. Cheques may take 2-5 working days, while online payments may take a few hours up to a day for the payment to be processed. If one is paying cash at the bank branch, a fee is usually charged for this service, but the payment will reflect faster. Different payment modes have different processing times for the payment to reflect in the credit card account. Therefore, it’s important to make the payment in advance to avoid missing the due date.

    7. Call the credit card company
    8. If however the credit cardholder still misses the due date, he/she should immediately call the card issuing company and work out some solution to avoid late payment penalties. If it is the first time that the person has missed a payment due date, he/she can opt for any of the aforementioned ways to ensure there would be no repeating of it in the future.

    9. Pay at least the minimum amount due
    10. It’s important to pay at least the minimum due by the payment due date. This will ensure that no late payment fees are charged. The customer can also avoid being charged a higher interest rate.

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    Reasons Why You Should Avoid Late Credit Card Payments Reviews

    • RBL Bank Credit Card
      "Easy to convert for EMI "
      0.5 4.0/5 "Great!"
      I got RBL card offer from BAJAJ Finance. I have been using this card past 10 months which is a life time free card. The credit limit is sufficient of 55K. EMI conversion is avail and I can convert via mobile app whenever required with nominal charge. I use this card for general purpose. Based on usage I get points but not yet redeem it.
      Was this review helpful? 27
      , chennai
      Reviewed on Mar 21, 2020
    • SBI Cards
      SBI Cards Credit Card
      "Good service"
      0.5 4.0/5 "Great!"
      SBI credit card have offers and reward points but I have not redeem them yet, this is a domestic card, the credit limit is of 50000 which I am very much satisfied as per my need. I got my statement on time. I used this card for personal purposes.The card is very user friendly.
      Was this review helpful? 33
      , hyderabad
      Reviewed on Mar 21, 2020
    • SBI Cards Credit Card
      "Ok service"
      0.5 5.0/5 "Blown Away!"
      I am using SBI credit card for more than three months, there are some reward points and offers in the card. I used this card for online shopping, fuel surcharge and groceries.The credit limit of the card is sufficient and I like the most about the card is that it is a life time free card and very good to use.
      Was this review helpful? 26
      , hyderabad
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Ok service"
      0.5 5.0/5 "Blown Away!"
      The bank agent suggest me to take credit card from INDUSIND and I have taken it because it doesn't have any annual fee. The offer and reward points are available in the card are good. I am satisfied with the limit of the card. I used the card for general purposes. But it will be nice, if the offers and reward points will be more.
      Was this review helpful? 15
      , jaipur
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Good service"
      0.5 5.0/5 "Blown Away!"
      I am using INDUSIND credit card for 3 months. The card have no offers available and also there is no rewards. The only benefit is that its a life time free card and the credit limit is only for 75000 I am not that satisfied as i expected to get around 1.5 lakh. Apart from the limit over all experience is good.
      Was this review helpful? 17
      , chennai
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Excellent card"
      0.5 5.0/5 "Blown Away!"
      I have got INDUSIND credit card few months ago and I have used it for two months now ,the credit limit of the card is Rs.70000 which is a life time free card. The bank have informed me every details about the reward points and offers but I have not got any time check it. I am satisfied with their card service.
      Was this review helpful? 18
      , hyderabad
      Reviewed on Mar 21, 2020
    • ICICI Bank Credit Card
      "Good service"
      0.5 5.0/5 "Blown Away!"
      Am having ICICI credit card for two years, I feel good and have not face any issues. The best part about the card is its a life time free card. I used to get my card statement on time. I used this card for shopping, groceries and for many other personal purposes.I am using the bank mobile app which function smooth and simple.
      Was this review helpful? 22
      , faridabad
      Reviewed on Mar 21, 2020
    • SBI Cards Credit Card
      "Good service"
      0.5 5.0/5 "Blown Away!"
      I have used SBI credit card for 2-3 months, but I have not got any time to check about the offers available in the card. The limit of the card is 38000 and I am satisfied because its a life time free card. I used to get my card statement on time and the net banking is also working very well.
      Was this review helpful? 31
      , faridabad
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Good service "
      0.5 4.0/5 "Great!"
      Since it is a life time free card offer from INDUSIND so I chosen it and applied through online. I received a call on time and they have done the verification process. Hence I received the card by 7 days, the credit limit is okay for me. Its easy to use for all purposes.
      Was this review helpful? 13
      , chennai
      Reviewed on Mar 21, 2020
    • Citibank Credit Card
      "Good "
      0.5 4.0/5 "Great!"
      CITI has provided good offers and benefits on 2 months before. So I chosen this card and applied through online. It is annual fee chargeable of 500 rupees bu there is waiver off option if I spend 30K within a year. The credit limit is 65K. There is EMI conversion avail for this card.
      Was this review helpful? 11
      , coimbatore
      Reviewed on Mar 21, 2020
    • HDFC Bank Credit Card
      "very good"
      0.5 5.0/5 "Blown Away!"
      I have used credit card from HDFC bank for 1 year which is very good and also very comfortable, its a life time free card and lots of offers are available in the card. This card was suggested to me by my colleague. Mobile banking also functions very smooth.
      Was this review helpful? 31
      , bangalore
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Average service"
      0.5 4.0/5 "Great!"
      INDUSIND bank credit card have an credit limit of of Rs.75000, there is no offers available in the card and it also have a charges of 3000 along with GST. I hardly receive any remainder messages for my bill payment due to that some time I could not pay my bill on time. I would advise them send my bill on time before the due date.
      Was this review helpful? 16
      , bangalore
      Reviewed on Mar 21, 2020
    • ICICI Bank Credit Card
      "Need to increase the credit limit "
      0.5 5.0/5 "Blown Away!"
      I have been using ICICI card for more than one year. They have provided an annual fee chargeable card and waiver off option is applicable. The credit limit is okay of 50K. Since I need to do purchase about 45K on some of the month so this limit is not sufficient. I swipe the card for travel, shopping and fuel purposes. I have not opted for EMI conversion.
      Was this review helpful? 16
      , kolkata
      Reviewed on Mar 21, 2020
    • Axis Bank Credit Card
      "Good card"
      0.5 4.0/5 "Great!"
      I have been using AXIS bank credit card for 3 years, Its a life time free card so I applied the card through bank. The agent have informed me everything about the card. I used to get offers of 10% on petrol bunk and shopping.The limit of the card is Rs.45000 and I used to pay my bill directly through bank.I am also using their net banking which is very good.
      Was this review helpful? 26
      , kolkata
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Good service"
      0.5 4.0/5 "Great!"
      I got INDUSIND credit card from few months ago.The card have an EMI conversion. I used the card for multi purposes like shopping, online payment, ticket booking. This is annually chargeable card, I am not satisfied with the credit limit of Rs.75000 as I am expecting more than than 1 lakh.
      Was this review helpful? 19
      , kolkata
      Reviewed on Mar 21, 2020
    • IndusInd Bank Credit Card
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      I got a life time free card offer from INDUSIND bank hence applied through online on three months back. I received the call on time and the process was done on smooth. I got the card on exact time frame. The credit limit is sufficient and they provided good offers and benefit as well.I use this card for shopping and travel purpose.
      Was this review helpful? 8
      , kolkata
      Reviewed on Mar 21, 2020
    • RBL Bank Credit Card
      "Average service"
      0.5 1.0/5 "Really Bad"
      RBL credit card is a chargeable card, I always have to go to Bajaj Finance to pay my credit card bill. I am not satisfied with the customer service which has to be improved. I used this card when ever needed for shopping, fuel surcharge and bill payment.The limit of the card is fine.
      Was this review helpful? 43
      , ranchi
      Reviewed on Mar 21, 2020
    • HDFC Bank Credit Card
      "Good service"
      0.5 5.0/5 "Blown Away!"
      HDFC credit card is very convenience to use, I have been using the card for 4.5 months for Shopping, groceries, fuel surcharge and electricity bill payment also. I pay my credit card bill through ATM. I always get my bill on time, this card was suggested to me by the bank agent.
      Was this review helpful? 23
      , ranchi
      Reviewed on Mar 21, 2020
    • RBL Bank Credit Card
      "Okay service "
      0.5 3.0/5 "Satisfactory"
      I used RBL card for twice only. I get message or call for EMI conversion from banker. It is a life time free card. Once all the process done I received the card by 15 days. I am holding this card past 6 months. The credit limit is sufficient of 30K. Once I tried to convert for EMI of 3 months it was done on time without any problem. It is Bajaj card.
      Was this review helpful? 13
      , chennai
      Reviewed on Mar 21, 2020
    • SBI Cards Credit Card
      "Good card"
      0.5 5.0/5 "Blown Away!"
      I have been using SBI credit card for the last two months, the credit limit of the card was satisfied it was Rs.9,80,000. The bank agent came and collect my document he have informed me every detail about the card. The card have a charges of Rs.2299 in a year. I used to pay my credit card bill through bank. Am getting my card statement in softcopy but I wish the bank can send me a hard copy statement also.
      Was this review helpful? 37
      , gurgaon
      Reviewed on Mar 21, 2020
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