What are the minimum interest rates of a credit card?

The resolve to digitalize the economy and erect a cashless society calls for an augmented rise in the use of forms of plastic money, such as credit cards. Credit cards allow varied sorts of transactions without having to pay the amount right at the spot. It grants an option before its users to delay the payment and postpone it to a certain fixed date in the future.

 By swiping at the point of sale machines installed at various establishments or by entering the card details during digital payment, credit cards can be comfortably availed. Credit cards have rendered modern life easier by permitting the disbursement of expenses monthly. Moreover, customers can savor numerous benefits with every transaction; for instance, the credit points earned can be redeemed in the future for a rewarding voucher. 

However, irrespective of the number of pros associated with credit cards, these are still not preferred by some customers. The credit card interest rates play a vital role in curbing people from utilizing its services in practice. Credit card interest rate is charged on the amount of outstanding balance — the money left to be paid after the passage of the due date.

 Any delay in clearing the dues attracts a hefty penalty, the fine being determined by the interest rate. Moreover, any payment or transaction executed without clearing the unpaid amount also comes under the purview of the interest rate.

However, one can bail out oneself from paying a heavy price by opting for credit cards that are accessible at a minimal interest rate. Several financial institutions offer credit cards at a nominal rate. Here’s an exhaustive list of the minimum interest rates offered by various banks, and some other financial entities.

•    SBI PRIME Advantage Credit Card: Available at 3.50% p.m. (42% p.a.) for unsecured cards and 2.5% p.m.(30% p.a.) for secured cards, SBI’s PRIME Advantage card is an automatic choice for those who do not fancy paying a heavy penalty. Even for those who do not possess a security deposit, i.e., those who possess unsecured cards, the finance charge is quite low and manageable. With a one-time fee of Rs.2999 and a renewal fee of the same amount, it offers an interest-free credit period of around 20-50 days. Moreover, one can avail of several benefits, for instance, a complimentary Club Vistara membership through this credit card. 

• Citibank Rewards Credit Card: Citibank’s Reward Credit Card is one of the prime options available for those who are fond of going on a shopping spree. It boasts of a bare minimum joining fee, an interest rate of 3.15%, and a cash advance of 2%. This credit card offers 10 points on every Rs.125 spent in a departmental or clothing store, whether online or through window shopping. These points can be redeemed anytime in the future because there’s no expiry date accompanying them.

•   HDFC Infinia Credit Card: With an interest rate as low as 1.99%, HDFC’s Infinia Credit Card can be a user’s delight. However, there’s a catch. Its joining and renewal fee is Rs.10,000 excluding taxes. Moreover, its membership is somewhat restricted. One can get hold of this credit card only if the respective person receives an invitation.

•        ICICI Bank Instant Platinum Credit Card: An interest rate as low as 2.49% is not the only advantage of this credit card offered by ICICI Bank. It does not entail any joining fee nor does it include any renewal price. Users can enjoy an interest-free period of up to 48 days.

•   Bajaj Finserv RBL Bank SuperCard: An amalgamation of the gains of 4 cards in one: credit card, loan card, EMI card, and a cash card, this SuperCard has taken innovation to the next level. Bajaj Finserv credit card benefits include a low-interest rate of 3.99% p.m.(47.88% p.a.),  withdrawals from ATMs without incurring any interest, and attractive EMI offers among others.

  Kotak Velocity Platinum Credit Card: Rs.399 being its joining and renewal fee, Kotak Velocity Platinum Credit Card is accompanied by a low-interest rate of 3.10% per month. When the fuel prices are rocketing to new heights with every passing day, this credit card attains a value no less than gold. This is because it allows a discount of 2.5% on the purchase of fuel at all petrol pumps across the country.