How to Make Credit Card Bill Payment – Online and Offline Options
Credit cards have become a quintessential part of our lives. From buying groceries to making online bill payments, credit cards have made our everyday life much easier. Every month a credit card bill is generated based on your transaction. Your job is to make credit card bill payments on time.
This post talks about how to pay your credit card bills – both online and offline. But before that let’s understand the basics first. Let’s dive in!
What is a Credit Card Bill Payment?
The process of paying your credit card bill is defined as credit card bill payment. Just like electricity and water bills are monthly cyclic bills, credit card bills are also cyclic. They are generated monthly based on the purchases and withdrawals made from the last bill.
Generally, the payment due date is set between 21 to 25 days after the bill generation date. The grace period is the interest-free period that the credit card holder enjoys.
For example, if you have a credit card and have made certain purchases with it, you are entitled to a credit card bill. You can receive this via post and/or email.
In case your credit card bill states that your monthly installment payment is due on the 30th of July, it indicates that your bill was generated either on the 5th of July or the 9th of July based on the 21 or 25-day grace period. And your previous bill was generated on the 5th or 9th of June.
Here’s a small tip – Make the most of the interest-free or grace period. You should make high-value purchases at the beginning of the credit card billing cycle. By doing this, you give yourself a window of at least 45 to 50 days that is free of interest. It ensures that you have a long gap between the day of making the purchase and the bill generation day.
The beauty of credit cards is that the interest-free period is equivalent to a zero-cost loan if used wisely and smartly. It is important to understand that the interest-free period is invalid in case you have failed to pay the entire amount of the previous month’s bill and in case any cash withdrawals are made using the credit card.
What is the Importance of Credit Card Bill Payment?
Paying your credit card bills is important to help you minimise the interest paid to your issuer. But that’s one side of it.
In case you fail to pay your card bill on time, the card issuer may levy penalty charges. If the amount due is over Rs.50,000, card issuers may charge up to Rs.1,300 as penalty fee.
Point to note: if the amount due is below Rs.100, the issuer may not levy any penalty.
Also, not paying your bills on time can significantly hurt your credit score. This can affect your creditworthiness. Hence, always make timely credit card bill payments to avoid any sort of hassles.
Another reason why credit card bill payments are important is that they affect the interest rate levied on you.
The interest rate is compounded daily on the outstanding bill amount. Furthermore, your interest rates also spike up when you make late payments. It is advised to pay up as much as possible instead of simply paying the minimum amount.
Also Read: 6 Tips To Increase Your Credit Card Limit
Credit Card Bill Payment Options
Here are different methods through which you can pay your credit card bill:
- Online payment modes
- Offline payment modes
Online Payment
There are different credit card payment online methods, including the following:
- Net Banking: Net banking is one of the easiest online payment options for credit card bills. With the help of a savings account, you can register your credit card using your existing net banking account to make payments directly. In case you do not have a savings account, you can still open an account for your credit card and make the payment through net banking.
- NEFT or RTGS: National Electronic Fund Transfer enables the transfer of funds across the country using the one-to-one transfer option. The NEFT or RTGS payment option enables you to pay your card bills online.
- UPI: It is the most common mode of bill payments used today across the country. Everyone has a unique virtual payment address or VPA that they can use to transfer and receive money. All credit card issues today give you a UPI option to make credit card payments using apps like Google Pay.
- Visa Money Transfer: It is an innovative service that enables visa cardholders to transfer funds from the customer’s bank account to visa credit card issuers. The payment can be made across India and can be completed within 3 working days.
- Electronic Clearance Service: ECS is an automated service that allows you to pay bills. It is an auto-debit method that gives instructions for automatic deductions for credit card issuers to pay your outstanding amount. The instruction can be to take away the whole owed or simply the minimum amount.
Offline Payment
The different offline payment modes include:
- Cheques and Demand Drafts: These are conventional methods of writing a cheque or creating a demand draft at your savings account bank. You can make the credit card bill payment using special drop-off boxes. However, this method has the slowest turnaround time and could affect your credit score.
- Cash Payment: Cash payments are made directly at the issuing bank. The payment status might reflect at the end of the business day; however, the process might require about 1-2 days to complete clearance.
Tips for Paying a Credit Card Bill
Here are a few tips to help you keep up with your credit card payments:
- Set up auto-pay: Set up automatic payments to relieve yourself from being late with your payments.
- Pay more than the minimum amount: Ensure that you always pay more than your minimum amount to keep a good credit score.
- Set reminder: Set alarms and reminders to help you remember that your bill is due.
- Build a plan: Develop a systemic plan and strictly adhere to it while paying off your debt.
- Pay before the due date: Try paying your due before the last date to avoid any hassle.
Credit Card Bill Payment Offers
Given the development of several platforms and applications, there are multiple applications where you can pay your credit card bills and get rewarded for using their services.
Platforms like Paytm, CRED, Mobikwik, etc., give you different incentives as a reward. Sometimes, they even offer you lower interest rates while paying off your bills as discounts.
The rewards can also be cashback or coupons you are entitled to redeem before the expiry date. Another form of reward could be application coins that allow you to accumulate them and finally redeem them for something worthwhile.
How Does a Late Payment Affect Your Credit?
Late credit card payments can affect you in the following ways:
- If you are less than 30 days late, you will have to pay a late fee accompanied by a higher APR (Annual Percentage Rate). However, it does not affect your credit score.
- In case of over 30 days of delay, it affects your credit score. A single time delay does not affect it largely, but make sure that you pay up on time.
- Being 60 days late affects your credit score substantially, but you can make up for it by being on time with the succeeding bills.
- If you are late for more than 90 days, it can affect your credit score significantly and could have damaging effects for at least 7 years.
- If you are over 120 days late, you shall be handed over to third-party collection agencies, which would have destructive effects on your credit score.
How to Pay Credit Card Bill without Missing the Due Date?
Follow these pointers so that you never miss your credit card bill payment:
- Set up a mobile reminder
- Have reminder emails sent to you by your issuer
- Set up an SMS alert system through your issuer
- Note it on your calendar
- Set up auto-sweep payment methods
How to Pay Credit Card Bill with Another Credit Card?
To pay a credit card bill using another credit card, you must do it indirectly, as there is no direct way of doing it. There are three methods to use credit cards to pay your bill. These include:
- Cash withdrawals: Withdrawing cash using a credit card through an ATM or a teller and then depositing it into the account for payment can be a way. However, it leads to higher interest rates on the withdrawal card.
- E-wallet: Withdrawing money into an e-wallet using a credit card and using it to pay credit card bills can be a method of credit card bill payment.
- Balance transfer: You can transfer the balance of one credit card to another and use it to pay your bills. It lowers your interest rates as well.
Also Read: What Is Minimum Amount Due In Credit Cards?
Things to Remember during Credit Card Bill Payment
Here’s what you can keep in mind:
- Ensure that you do not roll over due credit card bills
- Use the card smartly and limitedly
- Avoid withdrawals of large amounts
- Ensure you use the balance transfer option
Final Word
Credit cards can be an easy way to gain a zero-interest loan and have added spending money. However, it is important to understand that poor credit utilisation could also lead to large amounts of debt.
Ensuring that you have paid your credit card bills on time can help you build a good credit score and manage these issues effectively.
FAQs
Ans. The dangers can include missing payments and an increase in interest rates. Furthermore, the risks also involve a decline in credit scores, debt, and credit limit troubles.
Ans. The two important things include APR and bill due date.
Ans. At the end of each billing cycle, the issuer tells you how much you owe, the minimum payment it requires from you, and when that payment is due.
Before you go…
- Looking for instant 🚀 personal loans 24*7 anywhere, anytime? Get personal loans up to ₹20 lakh starting at 9.9% p.a. Install the Navi app now!!
- Or, maybe you’re looking to buy that house you’ve been eyeing 🏠 and you need a loan of up to ₹5 crore. Install the Navi app now and get instant in-principle approval right away! Interest rates starting at 8.74% p.a.
- How about an affordable health insurance policy👨⚕️ starting at a monthly premium of just ₹235? Install the Navi app now and get your policy in under 2 minutes.
- Instead, want to put your savings into action and kick-start your investment journey 💸 But don’t have time to do research. Invest now with Navi Nifty 50 Index Fund, sit back, and earn from the top 50 companies.
Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
