What are the various types of credit card charges?

Credit Cards have altered the way of making payments by allowing customers to shop now and pay later. Along with that, a wide range of benefits has further cemented its popularity among users. As a result, you see a spike in the popularity of this credit instrument. So if you are planning to apply for one, knowing the credit card charges is equally essential.

An Overview of Credit Card Charges

Charges for credit cards are the additional fee you need to pay for using the services. These come above the due amount, and you must pay them to keep using this payment card. Here are some of the credit card charges that you should know about –

Annual Fees

Annual fees on credit cards are imposed for servicing the credit card. This fee can get charged monthly, quarterly or once a year. However, the fees will depend on your card type. If you own a premium card, the annual costs will usually be higher than a regular card. 

Late Payment Charges

This fee will get imposed on you if you pay your credit card bill after your due date of payment, even if you pay the bill in full. It typically ranges from 3-5% of your total credit card bill and will be added to the next bill. This charge also adds interest for the number of days you have delayed the bill payment. Since this fee is for late payment, you can always avoid it by paying your credit bill within the due date.

Processing Fees for EMI Conversions

The majority of credit card companies allow you to convert yours due into EMIs. But are they free? The answer would be no; a processing fee is charged for these situations. This fee can be a fixed amount, or it can be a percentage of the total outstanding amount. A GST of 18% may also be charged on top of the fees for the EMI conversion. 

Lost Credit Card Fees

This will be charged only if you lose your credit card somehow. Your credit card company will indeed issue a new credit card but will also charge an amount that you will have to pay. This fee is known as a lost credit card fee.

Apr or Annual Interest Rate

Credit card charges also include an annual interest rate that will be applicable if you are unable to pay your entire credit card bill. APR can range up to 40% and will get charged monthly or quarterly. It is basically imposed on the outstanding balance on your credit card.

This annual interest rate can be avoided if you pay your whole bill within the due date. 

Foreign Transaction Charges

A foreign transaction fee will be levied if you use your credit card in a foreign country. This charge will roughly range between 3-5% of the amount that has been transacted, and then it will get converted into INR based on the exchange rate and depending on the date the transaction was made.

Cash Withdrawal Fees

This will be levied if you ever make a cash withdrawal from an ATM by using your credit card. Irrespective of the amount, it will be added to your outstanding, and the credit card issuer will levy this additional charge on it. Furthermore, it will instantly be added to your credit bill when you withdraw cash from the ATM. Therefore, it is advised not to withdraw cash from an ATM by using your credit card unless it is a dire emergency.

Over Limit Fees

Every credit card comes with a specified credit limit that you can use up to. If you cross this limit of your credit card, the credit card provider will allow an extension but against an over-limit fee.

Balance Transfer Credit Fees

Apart from these, you may have to pay an additional charge when you decide to balance transfer credit cards. There are some circumstances where a cardholder faces multiple credit card debts and are unable to pay altogether. In these cases, they can transfer their outstanding balance. It helps with the repayment. 

These were some standard credit card charges you must know before applying for a credit card. 


While choosing a credit card company, you learn about these charges in advance. For that, you can study the credit card-related terms and get all the details related to these and all other charges associated with the usage of this payment card. To sum up, compare different credit card companies depending on the charges and opt for one that suits your interest the best.

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