Many people like to borrow some amount to purchase some products. Credit cards help people to get instant loans for a certain time enable people to manage their expenses and deal with money requirements. Therefore, people need to deal with Credit Cards Interest Amounts to avoid any financial burden. You should know that its charges vary from bank to bank and people need to know it to avoid financial loss.
You may also like to use Credit card to make purchase and pay your bills. So, information about the rates levied by banks for the different credit cards can help you to avoid unnecessary charges. Credit Card Interest Charges may enable people to take financial precautions and avoid paying late. Awareness can also help in reducing your financial loss and taking proper initiative for proper utilization while paying less.
Credit Cards Interest Rate
In India, there are many banks that offer different types of Credit cards to customers based on their credit score and income. You need to know that credit cards provide temporary loans to individuals that need to be repaid to the bank within a certain time. Failure to repay may cause a Higher Credit Card Interest Amount, which can affect your financial planning.
You must be careful about the interest rates banks may levy on your credit card. This article will inform you about Credit Cards Interest Rates to understand and make your financial decision accordingly. This article will also help you when you get changes in interest rates and how they may change overtime which can affect your financial planning.
Understanding Credit Card Interest Rate
Banks levy charges to credit card holders when they fail to pay their bill amount to banks as they have taken instant loans. Credit card interest Rate is also known as the Finance charge which is imposed by banks according to the type of credit card and the total bill amount. So, you need to take care of paying bills at the time before getting late.
- Any Credit card holder who fails to pay their bills for any reason; may have to face a higher interest rate for the loan amount due to interest charges.
- However, different banks impose different interest rates according to their bank policy which customers should have informed of issuing credit cards.
- Credit Card Interest Charges must be considering avoiding any financial burden because the finance charge is much higher which can increase your financial stress.
When Credit Cards Interest Changed?
People need to understand the interest rate before issuing any credit card to use. Getting no information may cause higher financial risk which can affect their financial planning. You need to know that interest is applied to the outstanding balance of your credit card if fail to pay the full amount by the due date. So, you need to understand the Credit Cards Interest Charges to avoid any penalty of late fines in the form of higher interest rates.
Bank charges interest when credit card holder does not pay their full amount or pay the minimum amount. You may wonder how much interest rate banks may impose on your credit card. So, you should know that Credit Card Interest Rates may differ by bank and according to the type of credit card. However, full payment before the due date can save you from facing a higher interest rate on your loan amount.
Banks Credit Cards Interest Rates
| Name of Banks | Monthly Interest Rate | Annual Interest Rate |
| SBI Bank | Up to 3.50% | Up to 42% |
| HDFC Bank | 3.40% | 40.80% |
| Indusland Bank | Up to 3.83% | Up to 46% |
| Yes Bank | Up to 2.4% | Up to 28.8% |
| Axis Bank | Up to 3.60% | Up to 52.86% |
| Kotak Mahindra Bank | Up to 2.49% | Up to 29.88% |
| ICICI Bank | Up to 3.40% | Up to 40.80% |
Credit Card Interest Calculation
The Credit card holder needs to understand the overall calculation before issuing any credit card. Credit Card Interest Calculation can help you to understand when you will get charged by how much. It can help you to make your financial decisions accordingly. So, you need to consider certain points that are discussed below.
- You should know that interest rates for the credit cards in India are calculated according to the Annual Percentage Rate (APR).
- Instead paying interest charges for failure month, Credit card holder need to pay interest for the whole years.
- However, the Monthly Percentage Rate (MPR) is applied to calculate the interest amount.
- You also need to consider that both APR and MPR vary with banks and types of credit cards.
- You can understand the Credit Card Interest Amount Calculation from your relevant credit card issuer banks to avoid any financial burden in the future.
- Any individual can find the interest amount using this formula. [(Outstanding amount x Number of days from the transaction date x Interest rate per month x 12 months)/365].
When you can get Interest charged on a Credit Card?
Credit card holders need to take some precautions to avoid the higher interest charged to them. So, you need to understand the events which can cause High Interest Charge on Credit Cards. Check the following points to understand the situation when a bank charges a higher interest rate to your credit cards.
- When you fail making payment for the credit card bill.
- When you pay less amount than the outstanding bills.
- In case of failure to pay the minimum amount due.
- When you carry forward your outstanding amount.
- In case you withdraw cash using a credit card.
- When you fail to pay minimum amount due even less.
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Samarth Choudhary is a Chief Editor at keralacobank.com. He has overall editorial experience of 10 years in online media. He has completed his graduation from University of California and masters in Finance from University of Dallas in year 2010. His major interest and expertise is in Finance, Taxes, Government Aid and Schemes. His Major focus is to help users to get relevant information which are published on keralacobank.com in easy and precise form.