Utility Bills: The new rules of Yes Bank and IDFC First Bank are changing from May 1. Due to this, paying bills through credit cards will become expensive.
Utility Bills: If you too have got into the habit of paying your important bills including electricity and water through credit card, then you will need to think again. From May 1, credit issuing banks will start charging 1 percent from bill payers. In such a situation, the habit of paying bills through credit card is going to cost you dearly. Yes Bank and IDFC FIRST Bank were the first to announce this fee.
Yes Bank and IDFC increased charges
Yes Bank and IDFC First Bank have informed that they will charge 1 percent on utility bill payments from May 1. Due to this, if you pay electricity bill of Rs 2000 through credit card, you will have to pay extra Rs 20. However, these banks have also given some relief to the customers for the time being. Yes Bank has also given free usage limit up to Rs 15000 on utility bills and IDFC First Bank has given free usage limit up to Rs 20000. Due to this, you will be able to pay utility bills up to Rs 15 thousand from Yes Bank and up to Rs 20 thousand from IDFC First Bank without paying any fee. On payment above this, 1% charge as well as 18% GST will have to be paid.
Why was this change made?
Banks have decided to impose this charge for two main reasons. The first is the low merchant discount rate (MDR) charged on utility bills. MDR is a charge levied on every credit card transaction. This charge is the lowest on utility bills. Therefore, the bank gets less money if bills like electricity and water are paid through credit card. Secondly, banks had received information that some businessmen were using their personal credit cards to pay utility bills related to business.
What will be the impact on customers?
After this fee is imposed, using credit card to pay utility bills will become expensive. If you still want to make bill payment through credit card, many banks can offer to waive the fees. Apart from this, you can also make utility bill payment through UPI, debit card and net banking. You do not have to pay any fee for making payment through these methods.
Also Read-
- FD vs NSC: Where will you get more benefit on investment of Rs 2 lakh?
- Property Knowledge: Property lease and license are more effective than rent agreements
- Rule Change From 1st May 2024: These 4 rules can change from May 1, they will have a direct impact on your money.
