THERE are a lot of hidden costs on that credit card you own and if you aren't watchful enough, your monthly statement may shock you.
Here is a checklist on when and how your lender can slash you with charges.
You have an overdue payment
If you don't settle the minimum amount due by the due date, you would end up paying a late payment fee. This fee varies from bank to bank.
What if you don't pay your minimum amount due for two consecutive months? You become a defaulter. The course of action after that depends on the outstanding amount on your card and past track record. The bank will assign you a risk score, depending on which, the collection strategy changes. Also, any further transactions on your card will be blocked.
You revolve your balance
Banks give you this option to pay a minimum amount by the due date and carry forward the rest to the next billing period. In this case, you will pay an interest on the amount that you carry forward.
There's another catch: when you carry a balance from month to month, you do not get any 'interest free' period on new purchases you make.
Your payment cheque bounces
If you pay your bill by cheque and it bounces, you would have to bear a fee for dishonoured cheques. Also, if this payment is made very close to or after the due date, you might be in for more trouble.
The bank may not only increase your risk profile but also beyond the due date, you will have to bear all sorts of charges. This means, a fee for a bounced cheque plus a late payment fee and also a monthly interest on the outstanding amount!
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Other comments
Private and Foreign Banks in our country, will engage agents to canvass more credit card business.The person talking to us over phone does not reveal his real identity and he lures us to apply for the credit card by promising us credit limits of anything like minimum Rs.50,000/= upto Rs.3,00,000/=.His aim is to earn a commission of Rs.100/= per card.He wll not reveal any negative side of their credit card.Simply he asks us to sign in a blank application form,without permitting us to go through the contents of the application form..When we ask him for details of terms and conditions of the Credit Card,he just blinks and say that it will be send by the Bank..I am an employee of a leading Nationalised Bank.I had very bad experience of being lured into applying for the credit cards of Standard Chartered Card,ICICI Card etc.
Initially the agents trouble us over telephone-calling and disturbing us frequently and unnecessarily.
Once the application form passes onto the Bank,the Bank authorities start calling us and question us as if we have committed some fraud or crime.
It may be noted that we will find ourselves astonished,once we receive the Credit Card with the terms and conditions.
At the time of applying for these credit cards we will be offered heaven, by exaggerating about nothing,and we will be trapped and after receiving the Credit Card,we will become hell shocked to know that we have very much descended into REAL HELL OF PRIVATE AND FOREIGN BANKS-TAKE IT FOR SURE,WE WILL BE BANKRUPT.I am writing this comment out of my real-life experiences.
The private and foreign banks have lot of hidden charges and they will charge you even if there is no transaction done by you.
In brief the service fees charged by these so called "hi-tech banks"
are ransom,to make sure that ,you become pauper,penniless or bankrupt,as you like to call to.
Posted by on 20 Feb, 2009 at 08:56 PM
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