In today’s world, credit cards have become an efficient tool for managing financial transactions because of the unparalleled convenience they offer. But along with the ease that a credit card offers, it also brings in different kinds of fees or charges along. Out of those, one of the most important to understand is the credit card late payment charges. Credit cards levy late payment charges as a penalty whenever payments are not done within the due date.
Every credit card comes with a due date by which the outstanding credit card bill for a particular billing cycle needs to be paid to the issuer. After the end of a particular cycle, a credit card statement is generated where the outstanding amount due along with the due date of payment is mentioned. After the statement is generated, you are given a period of 15 to 20 days, by which you are supposed to clear your dues. Upon failing to pay your bill within the due date, a penalty fee is charged by the credit card issuer.
Paying late fees on your credit card bills can be financially burdensome. They can also affect your credit score severely. Here is how you can avoid paying late payment charges:
Once you get your credit card statement in hand, make sure to take note of the due date and set reminders so as to avoid paying your bills late.
A majority of banks allow you to set up an ‘AutoPay’ feature where your credit card billing amount will be automatically deducted from your bank account at a particular date every month. This way you run no chance of ever missing the due date.
The minimum amount due is a percentage of your total outstanding credit card bill amount that can be paid to avoid paying late fees. It is a great way for you to continue your credit card services while also avoiding paying the hefty late payment charges.
As per the directions of the Reserve Bank of India (RBI), banks and financial organizations are forbidden to levy late payment charges if the credit card bills are paid within 3 days after the due date.
Credit cards can be outstanding financial tools to make your daily transactions hassle-free. However, as a credit card holder, you should be responsible to pay your credit card bills before the due date. This way, you avoid paying the additional late fee while also maintaining a good credit history.
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Here are some tips to avoid paying credit card penalty charges:
The exact late fee charged on your credit card depends on the outstanding billing amount that you owe to the credit card lenders.
You can always request a late fee waiver from your credit card issuer.
If you fail to pay the late fee, the penalty amount will be added to the outstanding credit card bill due and an interest will be charged on it. So, yes, if you avoid paying your late fee, the amount will keep increasing over time.
If you are only 3 days late to make your credit card payment, you will not be charged a late fee according to RBI’s directions.
