Credit Card Reward Redemption charges allowed by RBI?

[ltf4ever]

idfc cc has started charging reward redemption charges since the last few months. any kind of redemption (cash/voucher) is charged. I think hsbc also charges.

but this is not the practice industry wide. citi, diners do not charge anything for points redemption. even cashback cards like axis fk dont.

so is this redemption charge something that can be challenged with the RBI? or is it a quick way of making money by the banks just like axis consolidated charges?

why is it that some banks charge while some dont?

 

[akshayhs]

IDFC Reward redemption has been charged from Oct 2022 if I recall correctly. We had a post here about the same, during the same month.

I personally don't think RBI will give a damn about it because certain aspects are on banks themselves. It is definitely a means to make money but it is given since it is a private sector bank.

 

[vasanth_ece]

IDFC Reward redemption has been charged from Oct 2022 if I recall correctly. We had a post here about the same, during the same month.

I personally don't think RBI will give a damn about it because certain aspects are on banks themselves. It is definitely a means to make money but it is given since it is a private sector bank.

Which means they can change the status of our card from Paid to LTF, in future?

 

[akshayhs]

Which means they can change the status of our card from Paid to LTF, in future?

IDFC credit cards were never charged a fee if I'm not wrong as all of their cards are LTF.

 

[NOOBY]

Which means they can change the status of our card from Paid to LTF, in future?

the banks can do this if they think you are not entitled to have LTF cards as per your usage/spending/etc

its no where written that once card is LTF they cant change its status

 

[NOOBY]

idfc cc has started charging reward redemption charges since the last few months. any kind of redemption (cash/voucher) is charged. I think hsbc also charges.

but this is not the practice industry wide. citi, diners do not charge anything for points redemption. even cashback cards like axis fk dont.

so is this redemption charge something that can be challenged with the RBI? or is it a quick way of making money by the banks just like axis consolidated charges?

why is it that some banks charge while some dont?

I dont think RBI can do anything...

Banks need to process internally and need to store all details in some database which costs money... as RPs are additional points and not money, they can charge redemption fees... nothing wrong

if HDFC can bear the amount, they wont charge but some banks might do it

They can say "dont redeem, that way you dont have to pay "

1 thing is, instead of asking money, they should have an option to cut additional points wrt the fees.. i.e. if they charge Rs.99+gst, then they should give any option to pay via 400 RPs (assuming 1RP=Rs.0.25)