New credit card rules & rewards this September: What you need to know

September brings new credit card rules: increased RuPay rewards, HDFC caps, IDFC payment changes, and RBI's network choice mandate. Here's all you need to know

September is here, and with it come various updates from banks regarding credit card rewards, payments, and a new directive from the Reserve Bank of India (RBI). Here’s what you need to know:

RuPay Credit Cards: More reward points

From September 1, RuPay credit cardholders are benefiting from more rewards. The National Payments Corporation of India (NPCI) has mandated that RuPay credit cards now earn the same reward points for UPI transactions as other payment service providers. This move came after the NPCI noticed that RuPay credit cards on UPI weren’t receiving the same benefits as other transactions and issued a directive to address this discrepancy.

 

In a circular dated August 5, the NPCI instructed banks to ensure that there’s no difference in the rewards and benefits for RuPay credit cards used on UPI versus regular credit card transactions. They stated, "Issuers shall ensure that reward points, benefits, features, and other ancillary offers should not be lower (directly & indirectly) for RuPay Credit Cards on UPI transactions and RuPay credit cards, except for transactions where issuer does not earn any interchange fee."

HDFC Bank: Caps on reward points

As of September 1, HDFC Bank has introduced caps on reward points for certain transactions. Here’s what has changed, according to a notification issued by the bank:

Utility spends, telecom, and cable transactions: Reward points are now capped at 2,000 per month across all credit cards.

Education payments via third-party apps: Payments made through apps like CRED, Cheq, and others no longer earn reward points. However, payments made directly through college or school websites will continue to earn points on all other HDFC credit cards.

Apple product redemptions: Redemption of reward points for Apple products will be limited to one product per calendar quarter, effective October 1.

Tanishq voucher redemptions: Starting October 1, redemption of reward points for Tanishq vouchers will be capped at 50,000 points per calendar quarter.

HDFC Bank also introduced a 1% fee on rental transactions made using third-party apps such as CRED, PayTM, Cheq, and others, capped at Rs 3,000 per transaction, which took effect last month.

IDFC First Bank: Changes to payment terms

IDFC First Bank has made adjustments to its credit card payment terms effective September 2024. The changes include:

Minimum Amount Due (MAD): The calculation of the Minimum Amount Due has been reduced from 5% to 2% of the outstanding principal balance, excluding FIRST SWYP & Commercial Suite Credit Cards.

Payment due date: The payment due date for credit card statements has been shortened from 18 days to 15 days. For example, if your statement was generated on September 1, your payment due date will now be September 16 instead of September 19.

New RBI rule: Freedom to choose your card network

Starting September 6, 2024, the RBI will prohibit card issuers from signing exclusive contracts with card networks. This means you’ll have the freedom to choose your own card network, either at the time of issue or later.

Why is this important?

According a RBI circular issued in March, 2024, the decision is aimed at promoting customer choice. Currently, when you apply for a debit or credit card, the network provider is chosen by the card issuer, leaving you without a say. The new rule changes this, allowing you to select your preferred network.

The RBI has instructed card issuers not to enter into agreements with card networks that restrict them from using other services. This option to choose will be available at the time of card issuance or renewal.

Who is exempt?

This new rule doesn’t apply to credit card issuers with fewer than 10 lakh active cards or to those issuing cards through their own approved networks.