Answers about Credit Card Balance Transfers?

Question

I made a balance transfer using my new credit card. I just received my latest statement and the bank increased the interest rate on the balance transfer. Can they increase my rate?

Answer 1

Mr Suhas,

At the outset, let me clarify that this site is designed by a group of Senior Banking Professionals to assist Bank Customers at large to provide guidance for resolution of any query / complaint / grievance in respect of financial services.  This site does not belong to any Bank or a Regulator, which may please be noted.

The interest rate chargeable on the revolving credit/outstanding balances is communicated in the welcome letter when credit card is sent. You are also conveyed interest rate when you apply for credit card. Normally, interest rates are revised for a category of the credit card holders. It is quite unlikely that interest rate stands revised for you upon balance transfer. You may write to the Bank/entity issuing credit card, seeking details of revision in interest rates and its applicability on individual basis or for a category of credit card holders.

Recently, RBI had a meeting with IBA and a select Bank wherein it was decided to put a cap on the interest rate charged on the credit card out standings. IBA will issue final guidelines on this in the near future.

Regards

Deepak