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!
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.
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
Here are different methods through which you can pay your credit card bill:
There are different credit card payment online methods, including the following:
The different offline payment modes include:
Here are a few tips to help you keep up with your credit card payments:
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.
Late credit card payments can affect you in the following ways:
Follow these pointers so that you never miss your credit card bill payment:
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:
Also Read: What Is Minimum Amount Due In Credit Cards?
Here’s what you can keep in mind:
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.
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.
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
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