Not making credit card payments on time could have serious implications for credit card holders. Their CIBIL score may go down and moreover, they end up paying a late fee along with interest on the due amount.
However, there are times when a credit card customer intends to make the payment on time but fails to do so due to a personal emergency, or some even just forget the due date. Is there any relief for such credit card customers?
Yes, there is some relief for credit card customers, who have missed the due date. However, they must make the payment within three days of the due date.
Top 5 credit cards for International Airport Lounge Access – Check features, benefits
Modi vs Modi: Samir Modi says have DNA reports to prove ‘I am not adopted’; done everything to make amends in relationship
Bharat Bandh Tomorrow: Who called it and why? What will remain open? Everything you need to know about nationwide shutdown on August 21
Mumbai-Ahmedabad Bullet Train Project: Breaking down engineering secrets of India’s first high-speed rail corridor
Also Read: How much time it can take to close a credit card
According to the “Master Direction” by the Reserve Bank of India (RBI), credit card issuers can report an account as “past due” to credit information agencies or levy any penalty only if the credit card account remains “past due” for over 3 days.
“Card-issuers shall report a credit card account as ‘past due’ to credit information companies (CICs) or levy penal charges, viz. late payment charges and other related charges, if any, only when a credit card account remains ‘past due’ for more than three days,” says RBI’s Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022.
“The number of ‘days past due’ and late payment charges shall, however, be computed from the payment due date mentioned in the credit card statement, as specified under the regulatory instructions on ‘Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances’ amended from time to time,” it adds.
Also Read: 5 things you should know before applying for a Cashback Credit Card
According to the RBI’s master direction, penal interest, late payment charges and other related charges can be levied only on the outstanding amount after the due date and not on the total amount.
