Do you often miss due dates of credit cards? Are you worried about the penalty it incurs and the subsequent impact on your credit score? If yes, then we have an easy solution for your troubles. Read on to know the details.
Credit card users often forget to pay their bills on times, especially those holding multiple cards. They fail to keep track of cards from different banks and often forget some, inviting heavy penalties from the issuing banks which also adversely affect the user’s credit score.
However, there is an easy solution for those who missed a due date on their credit card bills. This solution helps users to avoid any penalty whatsoever and also keeps one’s credit score healthy as a horse.
How to avoid penalty on missed credit card bills after due date?
According to the Reserve Bank of India (RBI), if a user misses a credit card bill payment due date, they can clear the bill within three days after the missed deadline. This way, the banks cannot charge a penalty and the user’s credit score also remains unaffected.
For example, if your due date was today (July 24), you can pay the bill till July 27 and avoid paying any penalty or affect your credit score.
What happens if the deadline is missed?
If the user still fails to clear their credit card bill within the 3-day deadline, it would invite a penalty from the issuing bank and also adversely affect the user’s credit score. A bad credit score means the consumer may not be able to take loans in the future until their credit score is in the green.
Clearing the bills after the 3-day deadline post due date will incur a late fee from the bank which will be added to the user’s next bill.
As per RBI rules, the number of days past the due date and late payment costs are calculated starting from the payment due date listed on the credit card statement. Late fee charges, penalty interest and other charges will be issued only on the outstanding amount after the due date and will affect the total amount.
How much is the penalty?
The penalty amounts depends on the user’s credit card bill, the higher the billing amount, the higher will be the amount of late fee or penalty.
Read More: 5 Banks Where Senior Citizens Can Get 9 Percent Or More Interest Rate, Check Full List Here
For State Bank of India (SBI) users, a penalty of Rs 400 would be charged if the outstanding amount ranges between Rs 500 to Rs 1000. If the amount ranges between Rs 1,000 and Rs 10,000 (9,999 to be exact), a penalty of Rs 750 would be charged.
Similarly, an outstanding amount of Rs 25,000 but less than Rs 50,000, a penalty of Rs 1,100 would be charged. Anything above Rs 50,000 would incur a penalty of Rs 1,300 from SBI.
Different banks levy different amounts of penalties depending on the bill amount. Some banks impose heavier penalties than others. Please check the terms and conditions of your credit card before opting for one from a bank.
