Credit card billing cycles are often inconvenient. The credit card company usually has total control over the billing dates. There is very little flexibility for credit card holders here. So, you must pay your credit card bills within the given time window to avoid additional charges. Not paying your credit card bills on time can also affect your credit score and overall creditworthiness.
The ability to change your billing cycle is thus a significant improvement. It gives you a breather during financial setbacks. But can you change your credit card billing cycle in India?
The answer is yes; RBI modified credit card regulations for customers in 2022. Let’s understand why this was a much-needed move on RBI’s part.
What do you mean by a billing cycle?
A credit card billing cycle is the time window. It refers to the closing date between two consecutive credit card bills. Your credit card payments are due 15-30 days after the billing cycle ends.
So, for instance, say your billing cycle is from 24th December 2022 to 25th January 2023. In this case, your credit card bill may be due on 19 or 20 February 2023. Any transaction done from 24th December 2022 to 20th February is interest-free. Missing your payment due date could lead to additional penalties, interest, and a low credit score.
RBI’s new mandate allows you to change your credit card billing cycle at your convenience. How does this affect you as a credit card user? Now you can change the billing cycle to coincide with cash flow. For example, you can move your payment due dates closer to your payday.
Why does changing your credit card billing cycle matter?
Is RBI’s decision helpful for credit card users? Yes, it is because now you can pay your credit card bills at your convenience. By shifting the credit card billing cycle, you can pay bills as per your current cash flow. It also affects your overall financial planning since the transactions are interest-free.
Additionally, this new move also helps people with multiple credit cards. They have several due dates that can be hard to manage. RBI’s decision can help them consolidate the billing cycles. You can always change all your billing cycles to a one-time payment. For instance, you can pay all your credit card dues before the tenth of every month.
RBI’s decision allows you to pay during a high cash flow. Thus, it also helps you avoid those late payment charges. However, RBI’s rules mandate that you can change your credit card billing cycle only once.
The Reserve Bank of India ruled that all banks and NBFCs should allow changes to the credit card billing cycle. It is a boon for credit card users since there is more flexibility. Furthermore, it will also allow you to manage multiple due dates seamlessly. The best way to use this new rule to your advantage is to get in touch with your credit card company. You can connect with ApnaPaisa to maximize your use of the credit card.