look news india
Reserve Bank of India (RBI) can take a big decision regarding credit card payment. It is being told that soon payment options like house or shop rent, society fees, tuition fees and vendor fees through cards may be stopped.
RBI expressed objection
RBI has expressed objection to this. The Bank believes that the credit card is meant for business payments by the customer to the merchant and not for personal transactions. RBI clearly says that if there is any transaction other than the customer and the businessman, then the person receiving the money will also have to open a business account. There is a lot of difference in the rules and standards of both, so it will be necessary to follow it.
its use increased
In the last few years, people have started using credit cards more for this type of payment. According to RBI, around Rs 1.5 lakh crore was paid through credit cards in February alone. There has been an increase of 26 percent on annual basis. The bulk of this payment relates to rent payments, tuition fees and society fees.
This is how it is used
In the last few years, many such fintech companies have emerged which offer the option of paying rent through credit card. For this, a special (escrow) account of the credit card holder is opened. The amount is added to the card and then sent to the homeowner's bank account. These companies charge one to three percent for this facility.
Customers will get benefits like this
This provides many benefits to credit card holders. For example, even if there is no cash, there is a window of 50 days for such payment. Many credit card companies also offer cashback and reward points on this. Some companies also waive the annual fee as per the expenditure limit.
banks became alert
After RBI came into action, banks have become alert and have started efforts to stop such payments. Many banks have stopped giving reward points on fare payment. Some banks have excluded the option of paying rent or tuition fees from the expenditure limit to waive the annual fee.