RBI Toughens Stand on Delay in Credit Card Dues’ Payment

The Reserve Bank of India (RBI) has tightened the norms for NPA classification of credit card accounts. Until now, you had 120 days’ time to pay your credit card bills before being classified as a non-performing asset (NPA). But now things are set to change. If you don’t pay your minimum credit card dues within 90 days of the date mentioned in the credit card statement, you will be categorized as NPA by your bank. The change in rules is effective immediately.

RBI said it will help bringing in greater amount of credit discipline. Also, the new rule will provide operational flexibility to credit card issuers. For the purpose of asset classification, the past due status will be considered from the payment due date mentioned in the monthly credit card statement.

So how does this impact you?

1. Banks will report a credit card account as past due to credit information companies (CIC) if you don’t make the credit payment within the due dates
2. Banks will levy penal charges, such as late payment fee, if the credit card account remains “past due” for more than three days.
3. The number of days past due date and late payment charges will be computed from the payment due date mentioned in the credit card statement.

Your credit score will be negatively affected if you continue to postpone paying your dues.