Credit cards have now become a powerful financial tool for individuals, for making expensive online purchases. It furnishes the customers with features that are rich with benefits and lucrative rewards useful for handling multiple expenses. Due to these hosts of benefits, India has seen significant growth in the credit card users in the past three years. According to a survey reported in the Economic Times, around 93% of Indians choose online card payment for purchasing expensive commodities. But with a rise in the number of users, the rate of online credit card payment delinquencies have also risen.
Recurrent usage of credit cards for carrying out expensive outlays, without settling the dues on time can negatively affect one’s credit history and profile. Credit history is an important aspect and should not be overlooked by an individual who is an active credit card users. An impeccable credit record helps in determining the loan repayment habit of an individual along with asserting his/her creditworthiness.
A healthy credit score usually lies between 750 and 900; this score can be achieved by adopting specific guidelines that can help an individual manage his/her finances better and raise his credibility.
Timely bill payments play an important role when it comes to building a strong credit profile. Following is an overview of how late payments can affect one’s credit score and how to avoid such situations.
How can late payment affect credit score?
An individual’s payment history accounts for 30% of his/her credit score with other factors like credit exposure, credit age and the total number of accounts making up the rest. Therefore, making timely online credit card payment is a mandate when it comes to maintaining a healthy credit score and building a strong profile.
Following is an overview of how late payments can affect one’s credit score –
- According to a recent survey conducted by CIBIL, delinquency on credit card bill payments for a 30-day period can reduce one’s credit score by 100 points. If an individual neglects their payment even further, their score will be further reduced.
- The record for missing one credit card repayment can reflect in one’s credit score for up to 7 years and more.
- Alongside affecting credit score, late payments can also affect one’s interest payment, with financial institutions levying a higher rate on advances, based on the borrower’s previous records.
To avoid such circumstances, it is imperative for borrowers to make online credit card bill repayments in a disciplined manner.
How to ease timely credit card bill payment?
Individuals can avoid debt accumulation on their credit cards by adopting the following methods –
- Automate credit card payments.
- Check the billing cycle carefully to ensure that you are aware of your due date.
- Keep track of your bill payments periodically.
With these few factors, individuals can ensure that their bill repayments are made on time and avoid the risk of delinquencies.
How to make credit card bill payment easily –
To facilitate easy repaying of your credit card debt, credit card issuers have introduced various online payment methods. Following are a few convenient methods which can allow individuals to ease online credit card payment –
● NEFT –
NEFT is a method to carry out easy one to one fund transfer. Through this method, credit card users have to submit the following details to make their online payment –
- Their name as it appears on their card
- Their credit card number
- Name of their financial institution
- IFSC code
- Branch location
● Bill Desk –
Bill desk is an online payment gateway that facilitates credit card bill payment for users. It is one of the most convenient pays to pay bills as individuals can receive their payment confirmation instantly.
● Through Apps –
Nowadays, financial institutions have introduced their mobile apps which allow users to make easy bill payments. For instance, one can choose to pay the bill of their Bajaj Finserv RBL Bank SuperCard through the RBL MyCard App. Payments made through apps are most convenient because it becomes easy to track the payment history and receive an instant confirmation for the same.
● NACH –
NACH is an electronic payment facility that facilitates online transactions. Individuals can utilize this facility to make bill payments for their credit cards easily.
With such payment modes and more, online credit card payment has been simplified to quite an extent. Therefore, individuals can adopt any of these convenient options to pay credit card bills and minimize the risks on one’s credit score arising from late bill payments. This can assist them to maintain a healthy credit profile with ease.
Author Bio: Shailendra Kumar is an experienced Financial Consultant and Tech Reviewer who has 6+ years of experience in the field of finance, business, and technology. He is very passionate to write about Finance, Business, Technology, Gadgets, Shopping, Fashion, Lifestyle, etc