Banks and credit card companies have lately been taking a hard look at benefits offered to cardholders. Now, IDFC First Bank has reduced such facilities on its credit cards, as per emails that its cardholders got on April 1. All cards have been affected, except its super premium IDFC First Private Credit Card.
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This comes on the heels of Axis Bank, ICICI Bank and Yes Bank devaluing their own card benefits recently.
IDFC First Bank has cut reward points on online spending, set higher spending-based criteria for airport lounge access, and updated terms for utility and rent payments made through its cards. The changes will be effective from May 1, 2024.
Revised reward points system
The reward points on online spends up to Rs 20,000 in a statement cycle will be cut to three times (3X) effective May 1. At present, it is six times (6X). Cardholders will continue to earn 10 times (10X) reward points on incremental spends above Rs 20,000 per month.
The reward points on education, wallet load, and government service transactions will be revised to 3X. These transactions will no longer be part of the 10X threshold calculations by the bank. The 3X reward points are equivalent to Rs 150 spent.
IDFC First Bank said it will levy a surcharge of 1 percent plus GST when the aggregate of utility bill payments made with a credit card crosses Rs 20,000.
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So, if all utility bill transactions (gas, electricity and internet) amount to Rs 20,000 or less in a statement cycle, there is no surcharge. If they exceed Rs 20,000, then the surcharge will be applicable.
If an IDFC First Bank credit card user pays utility bills of Rs 10,000 in a statement cycle, it will not attract a surcharge because it is below the threshold. If Rs 30,000 is spent on utility bills in a statement cycle, a fee of Rs 300 (1 percent fee) plus GST will be applicable.
The utility surcharge is not applicable on FIRST Private Credit Card, LIC Classic Credit Card, and LIC Select Credit Card.
“There are business spends in utility transactions using personal credit cards and credit card users are earning rewards on them,” said Sumanta Mandal, founder of TechnoFino, a platform that reviews debit and credit cards. So, the bank seems to have introduced surcharges on utility transactions to discourage misuse.
Airport lounge access
On IDFC First Select Credit Cards, the number of free domestic airport lounge visits has been reduced from four each quarter to two starting May 1. On First Wealth Credit Cards, the card holder will be able to access both domestic and international airport lounges twice per quarter, down from the previous limit of four visits.
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The credit cardholders must spend at least Rs 20,000 in a calendar month, an increase from Rs 5,000 per month (till April), to avail of complimentary airport lounge access in the following month. For complimentary lounge access in June, you need to spend a minimum of Rs 20,000 in May.
