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Credit Card Debt

( A Silent Time Bomb waiting to explode )

seeing figures is believing !!

Once the Credit Card Dues exceeds Credit Limit

See How fast it moves

Credit Limit
Amount of Outstanding
If unpaid, what will be figures after 12 months      
Effective Annual Rate of Interest %
Break up of charges  
Normal Interest %
Over the limit Charges %
Late payment charges %
Tax %


Facts one Should know about Credit Card Debts

* There are 2 important dates in credit card payment, Statement Date & Due Date of Payment.

* One gets interest free credit from the date of purchase to due date of payment. The grace  period is maximum up to 50-55 days. The minimum grace period is the difference between Due date and Statement Date.

* Interest free grace period can only be availed if the earlier credit card amounts are paid in full. Otherwise, there is application of interest on daily outstanding balance.

* In India, the monthly interest rate is 3.25% per annum on card loans, which translates to 39% per annum with monthly compounding. This is a very high rate of interest.

* If your outstanding is above the credit limit, there is an additional interest of 2.5% per month on the excess amount which is 30 % per annum. That means, for the excess amount, you are paying 69% per annum interest with monthly compounding !! God can only save you in such a situation.

* Moreover, there are late payment fees and taxes. Govt. also does not spare you !

* If you draw cash, then you pay a one time cash withdrawal fee which is very expensive and there is no interest free grace period for this ! You pay interest from day One.

* Precious Lesson : Avoid using Credit Cards if you are not a disciplined card holder. You shall not only cough up hefty amount as interest, you shall also be subject to rude calls from credit recovery people, harassment & humiliation and finally end up as a defaulter in CIBIL with all avenues of future finance closed.