14 Credit Card Hidden Charges - Hindi - YouTube

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Namaskar, my name is Mukul

And you are welcome to the Asset Yogi channel

Where we unlock the knowledge of finance.

In this video, I am going to talk about a very important topic

Which are credit card-related hidden charges.

When you take a credit card then there are many hidden charges involved in that

Which you don't know. They are making you poor day by day without you even realizing it.

Warren Buffet once said that if you earn 18 to 20% of interest every year

Which is compounded then nobody can stop you from being rich.

Similarly, if you are paying 18 to 20% interest to someone every year

Then nobody can stop you from being poor.

Credit cards are also the same kind of debt

Whose interest rates are very high

20%, 25%, 30 %

Interest is charged up to 35% also.

I have been using a credit card for the last 15 years.

I didn't know about some charges

That these kinds of charges are also charged.

I have made a video related to GST, basically on GST on loans

GST on home loans, personal loans, and credit cards.

During the research, I came to know that there are

These kinds of hidden charges are involved in the credit card.

So in this video, we will learn what types of hidden charges are there?

Which you can avoid very easily.

I am not saying to stop using credit cards.

But if you use it smartly then you can be saved from these high-interest rates.

So in this video, we will see all these hidden charges in detail.

Please watch the video from the start till the end.

So that you will not miss any important points.

Let's go straight towards the blackboard.

What charges are charged in credit cards?

We will understand this with the help of an example.

We will analyze an actual statement.

This is a real statement of my colleague.

And all the extra charges charged in this

We will study about them

And we will see how these charges could be avoided.

See, we are analyzing the credit card statement of Axis bank

So we will see what are the main charges in this?

See, the total payment is due for approx 42000 Rs.

The minimum due for this month is 23441 Rs

This is the statement of January to February

The credit limit is 60 thousand Rs.

Now see the previous balance

Previous balance means the balance of the previous month

And in this month there is no payment done.

This means the interest is charged on the previous balance.

The payments are zero here, credits are zero

There are no purchases for this month

There is no cash advance

And there is no withdrawal of any amount.

And these are other debit and charges

This is the interest of EMI and its principal amount

We will see this in more detail under the statement

The total payment due is 42000 Rs

So see, in this, they have taken the EMI

The total number of EMI is 5.

This is the total EMI balance

This means that this is the total principal of EMI and the balance is approx 18280 Rs.

They are paying some amount out of this total principal amount.

Maybe they are paying 4000 to 6000 Rs every month

The current balance that is left is Rs 18280.

Now we can see that there is no payment done this month.

So the additional charges that are added for this month

We will see what type of charges these are.

See this is a detailed statement.

Now you can see that different types of charges are charged

EMI interest, GST, principal, and again this interest and principal

The total principal amount that we saw

Let's count the total principal

One, after that this is the second principal amount

This is the third and this is fourth

And according to me, there should be fifth

So this is the fifth.

So we saw there were 5 balances of EMI

So the principal amount of 5 EMI is this.

So now we will see what different charges are charged.

So what are the major charges on the credit card?

Firstly, a late payment fee is charged.

Late payment fee means the minimum due that we saw

If we don't pay this minimum due of 23000 Rs this month

Then the late payment fee is charged.

Because they haven't paid the minimum due in the last month

So the late payment fee of 700 Rs is charged.

This late payment fee is generally a flat fee.

This is different according to the bank and credit cards.

So this ranges from 300 to 1000 Rs

After that, there are charges for cash withdrawal.

What charges of cash withdrawal are charged?

Whenever you withdraw the cash amount, 2 to 3% is charged as cash withdrawal charges.

Because there is no cash withdrawal during this month

so the cash withdrawal charges are not charged. Assume 1000 Rs were withdrawn

So 20 Rs would have been charged on 1000 Rs I.e 2 %

If you had withdrawn 10000 Rs then approx 200 Rs would have been charged.

After that interest charges are charged.

The interest charges are very important. I will highlight them here.

Only interest charges take you backward

They kill you.

Now we will see

What is the impact because of these interest charges?

Interest charges on credit cards are 2 to 4% per month

If I assume this as 3% or consider it as 3.5%

So then, you are paying the interest of 36% per annum

This is the most expensive debt.

This is the most expensive loan in a way.

So if you might face any loss

Then if you this much of high interest on credit cards

Then definitely it will be a loss for you.

There is no benefit of it. So the total amount due after the due date

As we have seen that assume the total amount due of 42,000 Rs

If they don't pay it, then the interest will add up on this.

Now, interest is charged on cash advances and withdrawals too

The cash advance that we have taken assume

If we withdraw some money, then the interest is charged on that

What type of interest is this? See an example is here

The debit interest you are seeing here, this interest is basically on cash withdrawal

They might have withdrawn some cash earlier.

They haven't done any cash withdrawals this month.

But they have done it earlier, interest is charged on that which is approx 1224 Rs.

Other than this late payment charges are also charged.

We have already talked about late payment charges. There is a late payment fee.

If you haven't paid this either then they start to charge interest on this also.

So see, you are charged with interest in everything. If you haven't paid for something

If you haven't paid the due total amount then interest is charged on that

If you do a cash withdrawal, the interest is charged on that also.

There are late payment charges also

Other than this all the charges whether they are late payment charges

Or cash withdrawal charges or whether your interest charges

GST of 18% is also levied on it. GST is levied on additional charges also.

Other than this, GST is also levied on the interests

This is a thing to note.

Even though interest is neither a good nor a service

This is a legal loophole. According to the Finance Act, all the credit card charges

whether it is interest, GST is levied on that also

I have made a video, in that, I had talked about GST and loans

I have mentioned in that

If you have a loan, I will write a loan here.

If you have any loan then there is no charge on the interest of it

But there is a charge on the interest of credit card's EMI

You can consider this a loophole.

But according to the Finance Act,

There is a charge on the interest of EMI

Of the credit card.

See, I will show you an example here, this is the interest of EMI

GST is levied on this interest also

So you are facing loss because of the interest that you are paying

Other than this, you are also paying GST additionally. You can see in the example

That the GST is charged everywhere, it is charged on the interest amount.

You can see, GST is charged everywhere, it is charged on a late payment fee

It is charged on debit interest, GST is also levied on the interest

So there are four main charges.

What other charges are there? We will talk about that also.

First, we will analyze how much we are paying extra?

So we are paying EMI principal as we have seen these 5 EMI

The total of these EMI is 6695 Rs, approx 6700 Rs

The extra charges that you are paying whether it is interest or GST or if it is a late payment fee.

If you add these,

Then you are paying the additional charge of 2700 Rs every month

See the total payment is 9400 Rs

You have to pay additional interest on this 9400 Rs next month.

Then GST is also charged on that

If they do not pay this interest, and

And doesn't pay principal

Then it will be added

So they will pay interest

Other than that, they will pay interest on interest.

So, we call it the debt trap

If you don't pay your amount

Then the interest is charged on that interest

And you get buried in the burden of the loan

So if you are paying 20%, 30%, or 36 % interest

And then you are paying interest on that interest also

Then definitely you are facing loss.

The loss is increasing. So as I have told you earlier in the introduction.

If you keep paying this much interest

Then it will make you poor

It's not going to make you rich.

So these were major charges. There are other charges also

Let's talk about them. But these 4 charges that I have told you

You should keep them in mind

And most important among them is interest charges.

So you should not take any type of EMI on the credit card.

And should not pay interest on that

And second, whenever you use your credit card, pay the full amount every month.

Or you will be stuck in this debt trap.

Let's see the other charges quickly.

Many credit cards charge an annual fee. What happens in the first year is

When they sell you the credit card they say your annual fee is free.

Generally, it is free for the first year

But after that every year the charges are charged.

They can vary from 250 to 2000 Rs according to the credit card.

There are different types of credit cards in the market. So this can vary.

So you should see what minimum fee can be charged.

And you should see if you can get it for free. Negotiate the annual maintenance

fee of any credit card. You may get many benefits from some credit cards.

If you use a credit card very much then you can pay some annual fee

250, 300, 500, or up to 1000 Rs

Assume your benefits are more

If you recover the fee, then there is no problem.

But you should know that the annual fee is charged.

Now, what other charges are charged?

Over-limit charges are charged

Assume your limit is 50000 Rs and

You spent 60000 Rs

So you have spent the extra 10000 Rs

The over-limit charges are charged on that

And these are very high.

As I have told you earlier, the interest on this is 2 to 4%

So if you over-limit then 2 to 4% charges are charged.

If your cheque bounces or you have set the auto-debit.

You automatically debit the credit card payment from your bank

If that bounces, then there are charges for that also

The charges can be from 200 to 500 Rs. Whenever your cheques bounce

If there is an auto-debit reversal, then one-time charges are charged.

Other than that, if you do a transaction in foreign currency

Assume you are traveling in foreign, then the charges will be charged for that also.

It varies on different types of credit cards.

The charges of 3 to 4 % of transactional value are charged.

Sometimes you buy petrol or diesel at a petrol pump.

So the credit cards charge on that also

The charges can be 1 to 2.5 % of transactional value.

So whenever you fill petrol or diesel then you should know that

If you pay with a credit card then the charges will be charged.

But some credit cards waive off these charges.

So whenever you apply for a credit card, then you would find out these things.

Other than this, a surcharge is charged on railway ticket booking.

This is charged from the government's side.

And in some credit cards, these are additional charges.

So whenever you book a railway ticket or do a cancellation then

1.5 to 3% of the transactional value can be charged.

You should find out clearly

That is what percentage is charged on your credit card.

Other than this, if your card gets lost, stolen, or damaged

And you apply for a new card

Then a flat fee is charged from 100 to 250

This varies from bank to bank.

If you ask for certified credit card statement

If you want the statement of 6 months to 1 year or above

Then these charges are charged

Otherwise, if you pull out a statement online then there is no charge.

And these are nominal charges.

If you want to pull out a certified copy from the bank.

Generally, this is required for the address proof

Then, nominal charges of 100 to 200 Rs will be charged.

Other than this if you make a cash payment

Whatever your credit card payment is

If you make a cash payment by going to the branch

Then many banks charge for that

Mostly they want you to pay online.

Because of their admin expense

So they are discouraging you in a way

Not to make a cash payment and make a payment online.

So that's why they charge a nominal fee of 100 to 200 Rs if you make a cash payment.

Other than this, if you use outstation cheque to make a payment

Then also some banks charge this kind of charges on outstation cheque

These charges are nominal charges from 50 to 200 Rs

Mostly this charge is waived off

Very few banks charge this kind of charge.

So these were all the important charges related to the credit card.

As I have told you earlier that I have discussed the 4 charges. These are very important.

I will repeat that interest is the most important.

If you keep paying the interest of 36% per annum

On the EMI of credit card

Or if you will not pay the dues of the credit card

Then this will make you poor

This is not going to make you rich. Now you may

Think that we have paid only 2700 Rs in this credit card statement

So how can one become poor by only 2700 Rs?

So imagine a person is earning 15000 to 25000 Rs per month

For him, paying extra 2700 Rs every month is very much

Your salary may be 1 lakh Rs

And your credit card bills are 50,000 Rs

And let's say you are paying the interest rate

and extra charges of 6000 to 7000 Rs every month.

So this is not a small amount for you.

So pay attention

And use the credit card smartly.

There is no harm in using a credit card but you should pay on time every month

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