Credit card payment rule change: Can you change credit card billing cycle, due date multiple times now? What RBI says (2024)

If you use a credit card, you may already know that you should pay the bill on time. Missing the due date of your credit card bill will have an impact on your credit score. Further, you will have to pay a hefty late payment fee for missing the due date over three days. Many times, people get a credit card with a due date that does not suit their personal cash flow cycle which may increase the risk of missing the payment by the due date. So, it is important to set your billing cycle in a way that you can pay your credit card bill without any difficulty. Can you choose or change your credit card billing cycle and due date? The answer is yes.

The Reserve Bank of India (RBI) has asked credit card issuers to provide customers an option to modify their credit card billing cycle at least once. In an amendment to the ‘Master Direction — Credit Card and Debit Card — Issuance and Conduct Directions, 2022’ released on March 7, 2024, the central bank said, "In order to provide flexibility in this regard, cardholders shall be provided the option to modify the billing cycle of the credit card at least once, as per the cardholders’ convenience."

Earlier, this provision said, "In order to provide flexibility in this regard, cardholders shall be provided a one-time option to modify the billing cycle of the credit card as per their convenience." So, earlier, the card issuers had to prove a "one-time option" for cycle change. Now, the provision reads that the option to change the credit card billing cycle "at least once".

Credit card billing cycle change: How will it benefit credit card customers?

A billing cycle or billing period is the time between two statement dates. A statement date is when your credit card bill for the ongoing month is generated. The due date of your credit card bill is usually 15-20 days after your credit card statement date. So, credit card users usually get an interest-free period of 45 to 50 days. When you change your billing date, the due date of your credit card payment will also change accordingly.

Find out how the latest amendment of credit card guidelines by the Reserve Bank of India will benefit credit card users.

"Card issuers do not follow a standard billing cycle for all credit cards issued. In order to provide flexibility in this regard, cardholders shall be provided option to modify the billing cycle of the credit card at least once, as per the cardholders’ convenience," says Sameer Singh Jaini, founder and CEO, of the Digital Fifth, a fintech consulting firm.

Credit card new rule: Set your credit card due date when you have a high cashflow

To not default on your credit bill, your credit card due date should be at a time when you have enough money to pay it. The thumb rule is to select a bill due date which is usually after your salary is credited. This is to ensure that you are not short of funds when you have to pay the bill. Avoid choosing a date at the end of the month when you may face a cash crunch.

If you have a business or are self-employed, then you can analyse your monthly earnings and expenditures and choose a date accordingly.

As you have the flexibility to choose your credit billing cycle now, choose the date that is most convenient for you.

Credit card rule change: For those who use multiple credit cards

Even if you set a daily reminder or auto-debit option, managing multiple credit card due dates could be cumbersome. If you miss your credit card payment, you have to pay high interest and a late payment fee. Moreover, missing the payment will adversely affect your credit score. If you forget to keep money in your bank account for auto-debit of your credit card bill, the banks will also levy a fee.

So, if you have an option, it is better to fix the due date of single or multiple credit cards according to what suits you the best. For certain customers, paying multiple credit card bills at one go can save time and hassle. For some, it could lead to a financial strain at the start of the month. So, paying one bill on the 5th of the month and another on the 20th is an easier option for them to manage.

A little advice for credit card users. "Consumers must carefully consider their financial needs and obligations before asking for adjustments to their billing cycles," says Jitendra Dhaka, Founder of BankSathi.

How can you change your credit card billing cycle and due date?

The process of changing credit card billing cycles or due dates will differ from one bank to another. Most banks provide options to change the credit card due date online on their net banking platforms. You can call the customer care department of your bank and inquire about the process to change your billing cycle. Do note that banks can have their own rules to change your billing cycle. So check with your bank and understand them carefully before changing your billing cycle and due date.

How many times can you change your credit card billing cycle and due date?

Can you change your credit card billing cycle more than once? Kunal Varma, CEO and Co-Founder at Freo, says, "While banks can offer the flexibility to change your billing cycle, the RBI guideline specifies cardholders should be allowed to modify their billing cycle at least once as per their convenience. It doesn't explicitly state banks must offer this option more than once."

However, some of the issuers may plan to offer this option to their customer more than once, to ensure customer convenience and better customer experience, says Prithwish Ray, Chief Business Officer, Hyperface.

Laksh Dua, Co-Founder at WeCredit, a start-up that provides quick and hassle-free loans, "Whether banks will give you the option to change your billing cycle more than once might depend on the specific policies and practices of individual banks. While the regulation mandates offering at least one opportunity for cardholders to modify their billing cycle, banks may choose to provide additional flexibility in this regard. It's best to check with your bank regarding their specific policies on modifying billing cycles."