Credit Card Online – 7 Hidden Charges You Must be Aware of

It is hard to resist the temptation of applying for a credit card, especially when you are lured to get one by the sales representative who makes a convincing pitch about the amazing benefits you can enjoy with a credit card. However, you must avoid such sales representative, what they say about ‘free credit card’ is anything but free. While the sales person would tell you about all the rewards and benefits you can enjoy with the card, he/she would not say anything about the various charges associated with it. It is therefore important that you are aware of all the hidden costs associated before you apply for a credit card:

Yearly maintenance fees

When you are applying for a credit card online, you come across things like ‘free credit card’ but don't pay much heed to these offers. Free credit card only implies that you don’t have to pay the joining fee or the annual fee for one year from the date of card issuance. However, after one year you would have to pay the annual maintenance fee, which typically ranges from 1500 INR to 3000 INR per year.

International transaction fee

If you want access to any foreign transaction with your credit card, be prepared to pay a fee for it. The price usually varies from 3.5 to 4% of the purchase amount. Also, note that the amount charged is first converted into Indian currency based on the existing market exchange rate on the day of transaction.

Cash withdrawal fee

Your credit also doubles up as an ATM card, and you can use it anytime to withdraw cash, however, unlike the debit card, withdrawing cash using a credit card would attract charges up to 2.5% of the amount withdrawn.

Card limit crossing charge

Every credit card has a certain usage limit, which implies that you can use the credit card for payments up to a certain pre-determined amount. And if you cross the prescribed limit even by 1 INR, the bank would charge minimum over limit fee, which is about 500 INR or 2.5% of the over limit amount, whichever is higher.

Duplicate statement charges

Every month the bank sends the monthly statement to the registered postal address for free. However, if for any purpose you request a duplicate copy of the statement, the card issuer will charge you a duplicate statement fee, which usually ranges between 50 to 100 INR.

Card replacement fee

If by mistake you lose your card or if your card gets stolen, the bank will charge a replacement fee for issuing a new card. This fee can vary from bank to bank, but is usually in the range of 250-300 INR. But before applying for credit card be aware of the hidden charges.

Cheque dishonour charge

If the cheque issued by you towards the credit card bounces, the bank will levy a cheque dishonour penalty charge, which is usually about 300 – 350 INR. Also, if you request for a representative to collect the cheque or cash on the overdue amount, you have to pay an additional 100 INR for collection charges.