Why it is Important to Make SBI Credit Card Payment on Time?


A SBI credit card is one of the most important financial inventions of modern times. It allows a card holder to purchase goods and services on credit and pay it back over time. In addition, a SBI credit card has several benefits over other modes of payments and of course, it eliminates the need for you to carry cash everywhere. However, it’s imperative to clear your monthly bill on time always; here’s why:

  1. To improve credit score:Disciplined swiping of a SBI credit card can help improve your credit score. Reason being, SBI credit card companies will report your payment activity to the credit bureaus. Moreover, unlike other credit facilities, using a SBI credit card doesn’t involve interest cost as long as total bills are paid by the due date. Hence, frequent payment on SBI credit cards and timely repayment of dues will help improve and build your credit score faster.


  1. To avoid late fees: When you fail to pay the amount due by the bill due date, your lender levies a late fee. This fee is added to your next SBI credit card bill and can range anywhere between Rs. 100 to Rs. 750 per month. Thus, make your SBI credit card payment before the due date to avoid the risk of penalties and late fees.


  1. To avoid high interest charges:If you think that paying the minimum amount due is sufficient to avoid interest on your outstanding bill amount, then you might be wrong. Your entire outstanding credit card bill will attract interest charges, irrespective of the amount that you have paid. For example, assume that your bill was generated on 4th August (payable by 24th August) for Rs. 6,000 and your minimum payable amount is Rs. 1,000. Now, even if you pay Rs. 1,000 by 24th August, you will still be liable to pay interest on the outstanding amount of Rs. 5,000. Hence, pay your bills on time to avoid high-interest charges.


  1. To get a higher credit limit:Frequent late or part payment of your SBI credit card bills may lead your card issuer to reduce your credit limit. This might restrict your future spending capacity. It may also reduce your credit utilization ratio, which in turn may reduce your credit score. If you pay your dues on time, your SBI credit card issuer might increase the credit card limit.


  1. To avoid withdrawal of interest-free grace period: Interest-free grace period refers to the maximum period available to clear your amount due on credit card. The length of this period can range anywhere between 20 to 50 days. No interest is charged on your transactions during this period, provided you pay off your entire bill by the due date. However, the card issuers may withdraw this grace period if you fail to make full payments on your due date. Thus, your fresh transactions in the subsequent billing cycle will also attract finance charges. In order to avoid this, it is important to make timely re payments on your SBI credit card.


Conclusion:Disciplined swiping of a credit card can provide huge financial benefits to the card holder. However, make sure to make timely repayments on your SBI credit card to avoid any late fee and to enjoy a lower interest rate.



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