First, IDFC First Bank, then Yes Bank & HDFC Bank, and now AU Small Finance Bank have also joined the party. Now, AU Bank credit card holders have to pay 1% extra fees for making payments towards fuel and utility after crossing a certain spend limit on each category effective from 15th August 2024.
I already predicted this at the beginning—all banks will follow this practice, it's just a matter of time. Maybe a few banks will exclude their topmost credit card from this rule, but all banks will follow this for sure.
New Fair Usage Policy of AU Small Finance Bank:
Interestingly, AU Small Finance Bank linked the fuel spend condition to the credit limit, but that's okay. As I said earlier in the case of HDFC Bank and other banks, all banks should allow their credit card holders to pay their actual utility bills using their cards and offer them rewards. They should put a maximum cap on how much you can spend on utility or any other low-margin category before the bank starts charging you for the commercial use of your personal card, instead of removing rewards from those important categories completely.
Well done, AU Small Finance Bank. Rs. 50,000 is a decent cap, and no one should have complaints about this.
[original pdf copy of this guideline attached]
I already predicted this at the beginning—all banks will follow this practice, it's just a matter of time. Maybe a few banks will exclude their topmost credit card from this rule, but all banks will follow this for sure.
New Fair Usage Policy of AU Small Finance Bank:
- Fuel: If aggregate fuel spends exceed 50% of your credit limit or Rs. 50,000, whichever is lower, within a calendar month, you will be charged 1% on aggregate fuel spends exceeding this condition.
- Utility: If aggregate utility spends exceed Rs. 50,000 within a calendar month, you will be charged 1% on aggregate utility spends exceeding this condition.
Interestingly, AU Small Finance Bank linked the fuel spend condition to the credit limit, but that's okay. As I said earlier in the case of HDFC Bank and other banks, all banks should allow their credit card holders to pay their actual utility bills using their cards and offer them rewards. They should put a maximum cap on how much you can spend on utility or any other low-margin category before the bank starts charging you for the commercial use of your personal card, instead of removing rewards from those important categories completely.
Well done, AU Small Finance Bank. Rs. 50,000 is a decent cap, and no one should have complaints about this.
[original pdf copy of this guideline attached]
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