Credit Card Payment: If you utilize a credit card, then this information is quite beneficial for you. Recently, the Supreme Court made a significant ruling by eliminating the 30% cap on credit card late payment fees. Following this ruling by the Supreme Court, credit card holders will now incur 30-50% interest on late payment of their bills.
Supreme Court has lifted the 30% cap on late payment fees
In a blow to credit card users, the Supreme Court has lifted the 30% cap on late payment fees. By making this ruling, the Supreme Court has overturned the 16-year-old ruling of the National Consumer Disputes Redressal Commission (NCDRRC). Following the Supreme Court’s ruling, banks can now impose late payment fees of 30-50% interest on credit card users. In 2008, the NCDRC made a significant ruling and established a cap of 30% on fees for late payments on credit cards.
Banks can impose late payment fees
In rendering the judgment, the panel led by Justice Bela Trivedi and Justice Satish Chand Sharma annulled the 16-year-old ruling of the NCDRC. All customers who either intentionally or unintentionally postpone credit card bill payments will be significantly impacted by this decision. Currently, banks can impose late payment fees ranging from 36% to 50% annually. This is why it is crucial for you to settle your credit card bill punctually now.
What was the previous rule?
In 2008, the NCDRC classified imposing over 30% interest on late credit card payments as an unfair trade practice. Subsequently, the NCDRC established a cap of 30% interest for late payment fees. Following this, institutions such as Standard Chartered Bank, Citibank, American Express, and Shanghai Bank submitted an appeal to the Supreme Court against the NCDRC’s ruling. During the consideration of this appeal, the Supreme Court has lifted the 30% cap on late payment fees for credit cards.