Use credit card with discretion: Here're fees, charges and penalties

Representative image
 
  • Treat a credit card as a convenient means to pay and not as an efficient way to borrow
  • Understand charges, fees and penalties (See table) and avoid taking excess debt
  • The most common reason for the build-up of debt is that borrowers make only partial payment or pay only the minimum amount due
  • The balance, then, gets added to the next bill and the combined amount attracts extremely high-interest charges 
  • Eventually, the cardholder has to pay heavy interest on the outstanding
  • Once in a debt trap, the only recourse is to take a personal loan to clear the debt or convert the credit card dues into equated monthly instalments


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel