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CREDIT CARD
MANAGE YOUR CREDIT CARD
RBI prohibits issue of unsolicited Credit Cards / upgradation
RBI'S MASTER DIRECTIONS ON ISSUE OF CREDIT AND DEBIT CARDS
Dated 23.04.2022 : Reserve Bank of India ( RBI ) has revised its Master Direction on Issue of credit / debit cards and issued a fresh set of guidelines on 21.04.2022 .
According to the circular issued by RBI , Scheduled banks , other than RRBs , Scheduled Urban co-operative banks and NBFCs with a minimum net worth of Rs 100 crores can issue credit cards subject to various terms & conditions .
Credit cards are to be issued on the basis of application made by the customers . Credit cards issued have to be activated based on customer's acceptance through OTP ( One time Password ) . Any issue of unsolicited cards/upgradation is strictly prohibited .
In case, an unsolicited card is issued/existing card upgraded and activated without the explicit consent of the recipient and the latter is billed for the same, the card-issuer shall not only reverse the charges forthwith, but also pay a penalty without demur to the recipient amounting to twice the value of the charges reversed. In addition, the person in whose name the card is issued can also approach the RBI Ombudsman who would determine the amount of compensation payable by the card-issuer to the recipient of the unsolicited card as per the provisions of the Ombudsman Scheme, i.e., for loss of complainant’s time, expenses incurred, harassment and mental anguish suffered by him/her.
Card-issuers shall seek One Time Password (OTP) based consent from the cardholder for activating a credit card . If the same has not been activated by the customer for more than 30 days from the date of issuance and if no consent is received for activating the card, card-issuers shall close the credit card account without any cost to the customer within seven working days from date of seeking confirmation from the customer. In case of a renewed or replaced card, the closure of an inactivated card shall be subject to payment of all dues by the cardholder.
No card-issuer shall report any credit information relating to a new credit card account to Credit Information Companies prior to activation of the card. Any credit information relating to such inactivated credit cards already reported to Credit Information Companies shall be withdrawn immediately; under no circumstances it shall take more than 30 days from the effective date of these directions.
Card-issuers shall ensure that the telemarketers they engage, comply with directions/regulations on the subject issued by the Telecom Regulatory Authority of India (TRAI) from time to time while adhering to guidelines issued on “Unsolicited Commercial Communications – National Customer Preference Register (NCPR)”. The card-issuer’s representatives shall contact the customers only
between 10:00 hrs and 19:00 hrs.
RBI has asked Card-issuers to ensure that there is no delay in sending/dispatching/emailing bills/statements and the customer has sufficient number of days (at least one fortnight) for making payment before the interest starts getting charged. In order to obviate frequent complaints of delayed billing, the card-issuer may consider providing bills and statements of accounts through internet/mobile banking with the explicit consent of the cardholder. Card-issuers shall put in place a mechanism to ensure that the cardholder is in receipt of the billing statement.
RBI has pointed out about the instances where unsolicited/applied-for cards have been misused before reaching the persons in whose names these have been issued. So RBI has emphasised that any loss arising out of misuse of such unsolicited cards shall be the responsibility of the card-issuer only and the person in whose name the card has been issued shall not be held responsible for the same.
RBI has also issued caution to credit card issuers with regard to customers holding several credit cards . As holding several credit cards enhances the total credit available to any consumer, card-issuers shall assess the credit limit for a credit card customer taking into consideration all the limits enjoyed by the cardholder from other entities on the basis of self-declaration/credit information obtained from a Credit Information Company, as appropriate. This shall be uniformly applied as per the board approved policy of the card-issuer.
The detailed master circular contains guidelines on issue , closure ,billing , levy of charges and penalty and other connected maters and you may go through the circular by clicking here
Dated 23.04.2022 : Reserve Bank of India ( RBI ) has revised its Master Direction on Issue of credit / debit cards and issued a fresh set of guidelines on 21.04.2022 .
According to the circular issued by RBI , Scheduled banks , other than RRBs , Scheduled Urban co-operative banks and NBFCs with a minimum net worth of Rs 100 crores can issue credit cards subject to various terms & conditions .
Credit cards are to be issued on the basis of application made by the customers . Credit cards issued have to be activated based on customer's acceptance through OTP ( One time Password ) . Any issue of unsolicited cards/upgradation is strictly prohibited .
In case, an unsolicited card is issued/existing card upgraded and activated without the explicit consent of the recipient and the latter is billed for the same, the card-issuer shall not only reverse the charges forthwith, but also pay a penalty without demur to the recipient amounting to twice the value of the charges reversed. In addition, the person in whose name the card is issued can also approach the RBI Ombudsman who would determine the amount of compensation payable by the card-issuer to the recipient of the unsolicited card as per the provisions of the Ombudsman Scheme, i.e., for loss of complainant’s time, expenses incurred, harassment and mental anguish suffered by him/her.
Card-issuers shall seek One Time Password (OTP) based consent from the cardholder for activating a credit card . If the same has not been activated by the customer for more than 30 days from the date of issuance and if no consent is received for activating the card, card-issuers shall close the credit card account without any cost to the customer within seven working days from date of seeking confirmation from the customer. In case of a renewed or replaced card, the closure of an inactivated card shall be subject to payment of all dues by the cardholder.
No card-issuer shall report any credit information relating to a new credit card account to Credit Information Companies prior to activation of the card. Any credit information relating to such inactivated credit cards already reported to Credit Information Companies shall be withdrawn immediately; under no circumstances it shall take more than 30 days from the effective date of these directions.
Card-issuers shall ensure that the telemarketers they engage, comply with directions/regulations on the subject issued by the Telecom Regulatory Authority of India (TRAI) from time to time while adhering to guidelines issued on “Unsolicited Commercial Communications – National Customer Preference Register (NCPR)”. The card-issuer’s representatives shall contact the customers only
between 10:00 hrs and 19:00 hrs.
RBI has asked Card-issuers to ensure that there is no delay in sending/dispatching/emailing bills/statements and the customer has sufficient number of days (at least one fortnight) for making payment before the interest starts getting charged. In order to obviate frequent complaints of delayed billing, the card-issuer may consider providing bills and statements of accounts through internet/mobile banking with the explicit consent of the cardholder. Card-issuers shall put in place a mechanism to ensure that the cardholder is in receipt of the billing statement.
RBI has pointed out about the instances where unsolicited/applied-for cards have been misused before reaching the persons in whose names these have been issued. So RBI has emphasised that any loss arising out of misuse of such unsolicited cards shall be the responsibility of the card-issuer only and the person in whose name the card has been issued shall not be held responsible for the same.
RBI has also issued caution to credit card issuers with regard to customers holding several credit cards . As holding several credit cards enhances the total credit available to any consumer, card-issuers shall assess the credit limit for a credit card customer taking into consideration all the limits enjoyed by the cardholder from other entities on the basis of self-declaration/credit information obtained from a Credit Information Company, as appropriate. This shall be uniformly applied as per the board approved policy of the card-issuer.
The detailed master circular contains guidelines on issue , closure ,billing , levy of charges and penalty and other connected maters and you may go through the circular by clicking here
CITICARD HOLDERS TO CONTINUE BE SERVICED AS EARLIER :
Dated 03.04.2022 : Citibank and Axis Bank have announced take over of Citibank 's retail business including credit card by the Axis Bank for a cash consideration of USD 1.6 Billion . It is reported that Citibank have issued around 25 lakhs credit cards in India .
To allay the fears of any adverse effect to the existing customers , both the banks have assured the customers that they would together would ensure continuity of customer service , even after the completion of sale , across all customer channels . Accordingly, all credit card customers of Citibank will continue to avail all the rewards, privileges, and offers to which they were previously entitled. Further they can utilize the services of wide banking network of Axis Bank to complete their transaction .
Some of the popular Citibank Credit cards are Citi Rewards Credit Card , Citi Cash Back Credit Card , IndianOil Citi Credit Card , Citi PremierMiles Credit Card , First Citizen Citi Credit Card and Citi Prestige Credit Card . Each of the cards come with their own reward points , cashbacks , lounge benefits and other privileges' . However it will be for the customers to decide whether they will migrate to the Axis Bank or close the relationship .
Axis Bank is hopeful of positive reactions to their acquisition . Amitabh Chaudhry, MD&CEO, Axis Bank said, “We are delighted with the addition of an enviable retail franchise and a high-quality talent pool as we continue our journey towards becoming a premier financial services brand, in line with our GPS strategy framework. This is a significant milestone in Axis’ journey of growth and leadership and will bring in great value for all stakeholders. The amplified scale and width of offerings, the diversified portfolio of products and global best practices will enhance customer experience, while greater synergies both on revenue and cost side will augment value for the new franchise. "
The transition is expected to happen between January to June 2023 .
Dated 03.04.2022 : Citibank and Axis Bank have announced take over of Citibank 's retail business including credit card by the Axis Bank for a cash consideration of USD 1.6 Billion . It is reported that Citibank have issued around 25 lakhs credit cards in India .
To allay the fears of any adverse effect to the existing customers , both the banks have assured the customers that they would together would ensure continuity of customer service , even after the completion of sale , across all customer channels . Accordingly, all credit card customers of Citibank will continue to avail all the rewards, privileges, and offers to which they were previously entitled. Further they can utilize the services of wide banking network of Axis Bank to complete their transaction .
Some of the popular Citibank Credit cards are Citi Rewards Credit Card , Citi Cash Back Credit Card , IndianOil Citi Credit Card , Citi PremierMiles Credit Card , First Citizen Citi Credit Card and Citi Prestige Credit Card . Each of the cards come with their own reward points , cashbacks , lounge benefits and other privileges' . However it will be for the customers to decide whether they will migrate to the Axis Bank or close the relationship .
Axis Bank is hopeful of positive reactions to their acquisition . Amitabh Chaudhry, MD&CEO, Axis Bank said, “We are delighted with the addition of an enviable retail franchise and a high-quality talent pool as we continue our journey towards becoming a premier financial services brand, in line with our GPS strategy framework. This is a significant milestone in Axis’ journey of growth and leadership and will bring in great value for all stakeholders. The amplified scale and width of offerings, the diversified portfolio of products and global best practices will enhance customer experience, while greater synergies both on revenue and cost side will augment value for the new franchise. "
The transition is expected to happen between January to June 2023 .
What is Tokenisation of Cards ?
Tokenisation is a process by which card details are replaced by a unique code or token, generated randomly (by an algorithm) , allowing online purchases to go through without exposing card details, in a bid to improve data security. While each number of the 16 numbers printed on a credit card will have a meaning and give clue to the various details of the card , the randomly generated token will have no meaning and hence it will be secure from the fraudsters and hackers. The token can be used in the particular merchant network where it is generated .
Meaning of 16 numbers in a Credit Card :
1. First number represents the network like Visa , Mastercard , American express etc .
2. 2 to 6 numbers represent the bank that is issued the card and it is called IIN or BIN .
3. The 7th and all other numbers following it ( except the last number ) represents the account number of the card which is assigned to the user .
4. The last number is a checker for the payment processing .
Normally merchants remember your card numbers when you a card in their network so as to make it easy for the next transaction . But if a hacker hacks their security system , your card number is open to them and they can make out all details of your card including issuer , network , account number etc .
USE OF TOKENS :
When tokenised , a random token replaces the card number in the computer network of the merchant . The hacker cannot dig out any information from the hacked token as it has no meaning . Further that token can be used only in the network which is hacked and cannot be used in any where else for stealing the money . Hence your card is much safer now .
Meaning of 16 numbers in a Credit Card :
1. First number represents the network like Visa , Mastercard , American express etc .
2. 2 to 6 numbers represent the bank that is issued the card and it is called IIN or BIN .
3. The 7th and all other numbers following it ( except the last number ) represents the account number of the card which is assigned to the user .
4. The last number is a checker for the payment processing .
Normally merchants remember your card numbers when you a card in their network so as to make it easy for the next transaction . But if a hacker hacks their security system , your card number is open to them and they can make out all details of your card including issuer , network , account number etc .
USE OF TOKENS :
When tokenised , a random token replaces the card number in the computer network of the merchant . The hacker cannot dig out any information from the hacked token as it has no meaning . Further that token can be used only in the network which is hacked and cannot be used in any where else for stealing the money . Hence your card is much safer now .
MERCHANTS CAN STORE CARD DATA FOR 6 MONTHS MORE
Restriction on storage of actual card data [i.e. Card-on-File (CoF)] by RBI
Date 24.12.2021 : In March 2020 . Reserve Bank of India ( RBI ) had issued notification prohibiting storage of card data by non-banks and and merchants from June 30, 2021. The time limit was extended up to 31.12.2021 later on . Later RBI brought regulations on CoF Tokenisation (CoFT) of card data were issued on September 07, 2021 on “Tokenisation – Card Transactions: Permitting Card-on-File Tokenisation (CoFT) Services”.
Now RBI has further extended time limit to store data to June 30, 2022. RBI further wants such data to be purged after 01st , July 2022 . Further RBI permits industry stakeholders to devise alternate mechanism(s) , in addition to tokenisation , to handle any use case (including recurring e-mandates, EMI option, etc.) or post-transaction activity (including chargeback handling, dispute resolution, reward / loyalty programme, etc.) that currently involves / requires storage of CoF data by entities other than card issuers and card networks.
To read RBI NOTIFICATION on this topic , CLICK HERE
Restriction on storage of actual card data [i.e. Card-on-File (CoF)] by RBI
Date 24.12.2021 : In March 2020 . Reserve Bank of India ( RBI ) had issued notification prohibiting storage of card data by non-banks and and merchants from June 30, 2021. The time limit was extended up to 31.12.2021 later on . Later RBI brought regulations on CoF Tokenisation (CoFT) of card data were issued on September 07, 2021 on “Tokenisation – Card Transactions: Permitting Card-on-File Tokenisation (CoFT) Services”.
Now RBI has further extended time limit to store data to June 30, 2022. RBI further wants such data to be purged after 01st , July 2022 . Further RBI permits industry stakeholders to devise alternate mechanism(s) , in addition to tokenisation , to handle any use case (including recurring e-mandates, EMI option, etc.) or post-transaction activity (including chargeback handling, dispute resolution, reward / loyalty programme, etc.) that currently involves / requires storage of CoF data by entities other than card issuers and card networks.
To read RBI NOTIFICATION on this topic , CLICK HERE
NOW DINER'S CLUB CAN ISSUE NEW CARDS
Dated 10.11.2021 : Now Reserve Bank of India ( RBI ) has lifted the curbs it had imposed on issue of new card by Diner's Club International Limited with immediate effect .
RBI had imposed restrictions on Diner's Club in April 2021 against on- boarding of new customers citing storage of data issues . Now it has clarified that the issuer has since complied satisfactorily its guidelines on the subject .
To read RBI Press release in this regard , CLICK HERE
Dated 10.11.2021 : Now Reserve Bank of India ( RBI ) has lifted the curbs it had imposed on issue of new card by Diner's Club International Limited with immediate effect .
RBI had imposed restrictions on Diner's Club in April 2021 against on- boarding of new customers citing storage of data issues . Now it has clarified that the issuer has since complied satisfactorily its guidelines on the subject .
To read RBI Press release in this regard , CLICK HERE
NO NEW MASTERCARDS IN INDIA
ISSUE OF NEW MASTERCARD IS PROHIBITED IN INDIA :
Dated 15.07.2021 : Indian regulator Reserve Bank of India ( RBI ) has imposed restrictions on Mastercard Asia / pacific pte Limited . from on-boarding new domestic customers onto their card networks from July 22 , 2021 . Hence no new cards can be issued by them in India . However the restriction will not impact on the existing mastercard holders .
The restriction is imposed as Mastercard Asia is not complying with RBI rules , which mandates all data on the cards issued in India are to be stored in India only .
In April 2021 , RBI had put similar restrictions on American express and Diners Card . With the new order of RBI , Visacard is the lone major international card issuer who can issue cards in India . Now Indian card Rupay and INternational card Visa will be the two major players in card market of India .
For RBI Press release dated 14. 07.2021 , CLICK HERE
Dated 15.07.2021 : Indian regulator Reserve Bank of India ( RBI ) has imposed restrictions on Mastercard Asia / pacific pte Limited . from on-boarding new domestic customers onto their card networks from July 22 , 2021 . Hence no new cards can be issued by them in India . However the restriction will not impact on the existing mastercard holders .
The restriction is imposed as Mastercard Asia is not complying with RBI rules , which mandates all data on the cards issued in India are to be stored in India only .
In April 2021 , RBI had put similar restrictions on American express and Diners Card . With the new order of RBI , Visacard is the lone major international card issuer who can issue cards in India . Now Indian card Rupay and INternational card Visa will be the two major players in card market of India .
For RBI Press release dated 14. 07.2021 , CLICK HERE
ISSUE OF AMEX AND DINER'S CARDS BARRED IN INDIA
ISSUE OF AMEX AND DINER CARDS RESTRICTED IN INDIA :
Dated 24.04.2021 : Indian regulator Reserve Bank of India ( RBI ) has imposed restrictions on American Express Banking Corp. and Diners Club International Ltd. from on-boarding new domestic customers onto their card networks from May 1, 2021 . Hence no new cards can be issued by both of them in India .
The restriction is imposed as the two companies are not complying with RBI rules , which mandates all data on the cards issued in India are to be stored in India only .
For RBI Press release dated 23.04.2021 , CLICK HERE
Dated 24.04.2021 : Indian regulator Reserve Bank of India ( RBI ) has imposed restrictions on American Express Banking Corp. and Diners Club International Ltd. from on-boarding new domestic customers onto their card networks from May 1, 2021 . Hence no new cards can be issued by both of them in India .
The restriction is imposed as the two companies are not complying with RBI rules , which mandates all data on the cards issued in India are to be stored in India only .
For RBI Press release dated 23.04.2021 , CLICK HERE
YOUR CARDS WILL COME WITH NEW FEATURES FROM TODAY
Updated on 01.10.2020 : In view of Covid-19 situation in the country , RBI had given time up to 30.09.2020 to implement the scheme . Don't be surprised if your cards have been disabled for on-line payments or international spends . From today onward , your credit cards would have been disabled for functions like international payments , contactless transactions , international payments etc in view of RBI Guidelines .
Out of the various functions available on your card , you can decide now which ones you want to use and swithch off others . Further now onward , you can fix the limit within the overall limit of the card and change the limits yourself and enable / disable any type of transaction on the website of credit card issuers . Login to your credit card issuers website and change the various limits for cash withdrawals , daily spends , on-line payments etc and also enable / disable various types of payments for cash , international payments , web payments and cash payments .
Further if you want to safeguard your cards from unauthorised usage , you may disable functions you may not use immediately for example international payment . At the time of necessity , you can re-activate the card for the particular function .
PS : Some banks like State Bnak of India have already implemented the feature , while some banks are yet to alter their softwares for the purpose .
Dated 16.03.2020 : Reserve Bank of India ( RBI ) had asked , on 15.01.2020 , all banks and card issuers to provide the following facilities in the new cards both debit and credit to be issued from today onward :
1. Customers should be able set transaction limits (within the overall card limit, if any, set by the issuer) which include
to switch on / off and set / modify transaction limits for all types of transactions – domestic and international, at PoS / ATMs / online transactions / contactless transactions, etc.
2. The facility will be available on a 24x7 basis through multiple channels - mobile application / internet banking / ATMs / Interactive Voice Response (IVR) . Banks should make the facility available at all branches / offices .
3. Banks will send alerts / information / status, etc., through SMS / e-mail, as and when there is any change in status of the card.
Further card issuers were asked to disable all the cards issued by them which are never used for on-line transactions by March 16,2020 . However the facility to use the cards in ATMs and Point of Sales ( POS ) Devices will continue . The card issuers were also asked to review all other existing cards issued and decide whether to continue the facilities in the cards based on risk perception .
As per RBI instruction the new cards ( Fresh / RRe-issue ) will come only with only ATM transactions and
POS transactions enabled . However the customers can enable on-line transactions if they desire .
Hence you may have to enable on-line transactions and set usage limits for on-line and ATM transactions both for domestic and international spends for the new cards and renewed cards issued from today onward . Already some of the card issuers are giving such facilities on selected cards .
For RBI Notification , CLICK HERE
PAY CREDIT CARD DUES ON TIME OR ELSE ?
Dated 03.04.2020 : Reserve Bank of India has permitted all commercial banks to grant a moratorium of three months on payment of all installments falling due between March 1, 2020 and May 31, 2020. The repayment schedule for such loans as also the residual tenor, will be shifted across the board by three months after the moratorium period. But as per RBI instruction , Interest shall continue to accrue on the outstanding portion of the term loans during the moratorium period.
The moratorium applies to credit card dues also and hence your credit card companies are approaching you offering the moratorium as prescribed by RBI . But before availing any such facility and defer your payments , ponder over the following points :
1. Interest rates on Credit cards are very high and interest is not waived on your dues . Hence interest that accrues on credit card dues will also be high . Hence you may ultimately pay much more than your current dues .
2. You may be waived of penalty and penal charges of interest but your regular interest payment itself will be high .
3. Your credit score will not be affected or delayed payment will not be considered as default .
In overall the amount you pay later than due date will be higher than the actual dues and it may be substantially higher if you avail any further concession of deferred payment . Hence if your financial position permits , it is prudent to pay off the dues within due date . Or else you will be ending paying interest at credit card rates and bankers will have last laugh .
Availing of moratorium on credit cards should be resorted as a last resort if no other financial source is available
Dated 03.04.2020 : Reserve Bank of India has permitted all commercial banks to grant a moratorium of three months on payment of all installments falling due between March 1, 2020 and May 31, 2020. The repayment schedule for such loans as also the residual tenor, will be shifted across the board by three months after the moratorium period. But as per RBI instruction , Interest shall continue to accrue on the outstanding portion of the term loans during the moratorium period.
The moratorium applies to credit card dues also and hence your credit card companies are approaching you offering the moratorium as prescribed by RBI . But before availing any such facility and defer your payments , ponder over the following points :
1. Interest rates on Credit cards are very high and interest is not waived on your dues . Hence interest that accrues on credit card dues will also be high . Hence you may ultimately pay much more than your current dues .
2. You may be waived of penalty and penal charges of interest but your regular interest payment itself will be high .
3. Your credit score will not be affected or delayed payment will not be considered as default .
In overall the amount you pay later than due date will be higher than the actual dues and it may be substantially higher if you avail any further concession of deferred payment . Hence if your financial position permits , it is prudent to pay off the dues within due date . Or else you will be ending paying interest at credit card rates and bankers will have last laugh .
Availing of moratorium on credit cards should be resorted as a last resort if no other financial source is available
TAX ON CREDIT CARDS ON IMPLEMENTATION OF GST :
Dated 04.07.2017 : Service tax on financial services , which included Banking / credit cards / insurance / mutual funds etc and was charged at 15 % has been now replaced by GST at 18 % . But there is fake news being circulated in social media like Facebook , Whatapp that a customer has to pay tax twice if pays his bills through credit cards . As per the fake news , GST has to be paid twice once on the utility bills like electricity , telephone mobile etc and second time on credit card payment . The news is not correct as GST will be collected only on service charges levied by banks like annual fee , cash withdrawal charges in ATMs , late payment charges etc and not on the bill payment . Hence there is no question of paying GST on paying your bills through credit cards . GST , like earlier service tax will be levied on the amount of service charges levied by the bank and not on the transaction value . If you conduct your banking transactions within the limit allowed by the banks , banks may not levy service charges and there will be no GST payment on it .
Normally banks levy service charges on transactions like Money Transfer , Cheque Book issue , Atm cash withdrawal , annual fee on debit / credit cards , late payment charges , penal charges etc . The list is illustrative . One has to pay GST of 18 % on the service charges levied . Suppose if you draw cash from ATM using credit card , say Rs 5,000 and if bank charges Rs 300 as cash withdrawal charges , you have to pay GST of Rs 54 only at 18 % on Rs 300 only and not on Rs 5000 cash withdrawn . Similarly if you pay mobile bill through credit card and if you settle credit card bill within due date for payment of credit card , there will be no charges levied by bank and hence no GST .
Hence credit card customers can continue to make payments on their utility bills through credit cards without worrying about GST . However note to pay the credit card bill before last date as late payments attract various charges like penalty , interest etc . Such charges may be heavy and avoid them .
Dated 04.07.2017 : Service tax on financial services , which included Banking / credit cards / insurance / mutual funds etc and was charged at 15 % has been now replaced by GST at 18 % . But there is fake news being circulated in social media like Facebook , Whatapp that a customer has to pay tax twice if pays his bills through credit cards . As per the fake news , GST has to be paid twice once on the utility bills like electricity , telephone mobile etc and second time on credit card payment . The news is not correct as GST will be collected only on service charges levied by banks like annual fee , cash withdrawal charges in ATMs , late payment charges etc and not on the bill payment . Hence there is no question of paying GST on paying your bills through credit cards . GST , like earlier service tax will be levied on the amount of service charges levied by the bank and not on the transaction value . If you conduct your banking transactions within the limit allowed by the banks , banks may not levy service charges and there will be no GST payment on it .
Normally banks levy service charges on transactions like Money Transfer , Cheque Book issue , Atm cash withdrawal , annual fee on debit / credit cards , late payment charges , penal charges etc . The list is illustrative . One has to pay GST of 18 % on the service charges levied . Suppose if you draw cash from ATM using credit card , say Rs 5,000 and if bank charges Rs 300 as cash withdrawal charges , you have to pay GST of Rs 54 only at 18 % on Rs 300 only and not on Rs 5000 cash withdrawn . Similarly if you pay mobile bill through credit card and if you settle credit card bill within due date for payment of credit card , there will be no charges levied by bank and hence no GST .
Hence credit card customers can continue to make payments on their utility bills through credit cards without worrying about GST . However note to pay the credit card bill before last date as late payments attract various charges like penalty , interest etc . Such charges may be heavy and avoid them .
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TAX PLANNING FOR FY 2021-22 ( AY 2022-23 )
Comprehensive Article on Income tax changes in Rules, Rates , Slabs , Rebates and Estimation
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TAX PLANNING FOR FY 2021-22 ( AY 2022-23 )
Comprehensive Article on Income tax changes in Rules, Rates , Slabs , Rebates and Estimation
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Credit Card basics - How to select one that's right for you?
1. Think
for what purpose you are going to use the card.
whether you intend to pay in full before due date
what are the charges issuer are going to charge
what will be the interest rate in case of delay
what rewards you are going to get on usage.
2. Go to websites of leading issuers and compare various cards available.
3. If you intend pay in full , take card with least charges. Cards are available with no joining fee and no annual fee.
4. If you intend partial payment , take one with least interest . Our advice is to make full payment of cards before due date. Interests are very high on cards (view video below).
5. Depending up on your spending expectation like travel , shopping etc , chose specialized cards for the purpose . you will have more reward points on such usage.
whether you intend to pay in full before due date
what are the charges issuer are going to charge
what will be the interest rate in case of delay
what rewards you are going to get on usage.
2. Go to websites of leading issuers and compare various cards available.
3. If you intend pay in full , take card with least charges. Cards are available with no joining fee and no annual fee.
4. If you intend partial payment , take one with least interest . Our advice is to make full payment of cards before due date. Interests are very high on cards (view video below).
5. Depending up on your spending expectation like travel , shopping etc , chose specialized cards for the purpose . you will have more reward points on such usage.
PRECAUTIONS WHILE INVESTING : CLICK HERE TO READ
TAX ON RETIREMENT
MORE THAN 15000 VIEWS
CLICK HERE TO READ
HOW TO LINK YOUR AADHAR TO PAN ? CLICK HERE
WHAT IS NEW ON PLAN N PROGRESS ?
SOME LEADING ISSUERS OF CREDIT CARDS IN INDIA
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You can directly go to their links below and see what they offer
ICICI BANK LTD STATE BANK OF INDIA CITI BANK HDFC BANK LTD STANDARD CHARTERED BANK HSBC BANK LTD Most of the Nationalized banks , for example Indian Overseas Bank , also issue credit cards. If you have account with them, you can directly approach them. Even many Indian Pvt sector Bank issue credit cards . You can use your existing relationship with the bank for obtaining credit card TYPES OF CREDIT CARDS |
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Plan your Expenses Plan Credit Card use Tweak your Bank Account and Earn Extra Income Click Below to Read HAVE CAKE AND EAT IT |
VISA LOGO
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Mastercard Logo
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American express Logo
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RUPAY CARD
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By NET WORK :
VISA : Visa Network is most popular among all networks which connect Credit card Issuers , Merchants accepting the cards and holders of cards . Partner banks issue VISA branded credit cards which signifies that network partners of Visa accept the cards . Visa do not issue credit cards directly and they connect and facilitate payment process .
MASTERCARD : Its operations are similar to Visa and they also do not issue credit cards directly .
AMERICAN EXPRESS : American express maintains network as well as issues credit cards directly .
RUPAY : Only Indian Payment Network operated by NCPI
VISA : Visa Network is most popular among all networks which connect Credit card Issuers , Merchants accepting the cards and holders of cards . Partner banks issue VISA branded credit cards which signifies that network partners of Visa accept the cards . Visa do not issue credit cards directly and they connect and facilitate payment process .
MASTERCARD : Its operations are similar to Visa and they also do not issue credit cards directly .
AMERICAN EXPRESS : American express maintains network as well as issues credit cards directly .
RUPAY : Only Indian Payment Network operated by NCPI
Safety Tips for Usage of Cards 1. Sign the signature panel on the back of your card as soon as you get .
2. Never keep your PIN code in the same place as your card. 3. Keep your account number private. 4. Make sure your devices and networks are secure. 5. Shop online only on trusted web sites. 6. Keep your passwords a secret. 7. Have a tab on your account . Check often. 8. The most important tip - USE YOUR CARD JUDICIOUSLY Use your card for what you need to buy . Never buy just because your card has a spending limit. To understand how to manage your credit card bills efficiently, check out the video below 'Credit Card Debt Explained With a Glass of Water'. |
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Credit Card Fraud
Although there is no way to foolproof a credit card fraud, there are ways to reduce chances or reduce the damage it can do to you.
Some tips -
1. Keep tabs on your account . Check often.
2. Store the phone number of your credit card companies in your mobile for stolen credit card reporting. Call them immediately once you find out your card is stolen to cancel your card, and dispute any transactions you have not made.
Videos below offer helpful advice on these matters.
Some tips -
1. Keep tabs on your account . Check often.
2. Store the phone number of your credit card companies in your mobile for stolen credit card reporting. Call them immediately once you find out your card is stolen to cancel your card, and dispute any transactions you have not made.
Videos below offer helpful advice on these matters.
