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Credit Card: 45 days interest-free period of credit card is the time when you do not have to pay any interest on your expenses. After all, what is this game of 45 days, when does it start and how to use it wisely so that maximum results can be achieved?
New Delhi. If credit card is used properly, it can become not only a means of spending but also a financial buffer for a few days without interest. Most credit cards in India offer an interest-free period of 45 days (up to 50 days in many cases). But there is a strict condition that if you do not pay the entire bill on time, then this benefit ends immediately.
Banks count interest not from the date of card swipe, but from the date of bill generation. Every card has a fixed billing cycle. That’s why more days of interest-free period are available for purchases made on certain days of the month, while less for purchases made closer to the bill.
Benefit of interest-free period is not available on every transaction
Suppose your billing cycle is from 5th to 4th of every month. If you made a purchase on the 6th, it will appear in the next statement and you will get about 45 days for payment. But if you purchase on 3rd, it will be added to the bill of the same month and you will probably get only 15–20 days. This is why it is wrong to assume that you will get benefits for 45 days straight on every transaction.
What happens if full payment is not made?
This is the most important thing. If you have not paid the entire due amount or have paid only the minimum amount due, then the bank charges interest on the entire due amount and that too from the date of purchase. Along with this, GST is also added on interest and late fees.
Still, why is this period beneficial?
This feature is very useful when used properly. Helps salaried people to maintain balance between expenses and income. Major household expenses can be deferred for a few weeks without interest. Small businessmen also use it for short-term cash flow. Just remember to use the credit card as a payment tool, not a loan.
What things should you pay special attention to?
- Remember your billing date and due date.
- Pay your full bill on time every month.
- Avoid cash withdrawal, there is never an interest-free period on it
If the timing and discipline is right, the 45-day interest-free period helps you manage your expenses without interest. A little carelessness can also make it an expensive loan.
