The State Bank of India (SBI) is one of the largest banks in India. It offers various financial services, including credit cards. Many people in India use SBI credit cards for shopping, travel, online payments, and more. Now, SBI Card has announced a new rule that will soon be applied to all cardholders. Let’s understand what this new rule is, when it will be active, and how it will affect users.
What is the New Rule State Bank of India ?
State Bank of India SBI Card has announced that a new processing fee will be charged when you pay your rent using an SBI credit card. Earlier, users were able to pay rent to their landlords using credit cards without any extra charges. But from now on, SBI Card will apply a processing fee on such transactions.
When Will the New Rule Start?
The new rule will come into effect from 17 August 2024. After this date, if you pay rent using your SBI credit card, you will have to pay extra charges.
What Are the Charges?
According to the official notice from SBI Card, a 1% processing fee + GST will be applied on all rent payments done using credit cards.
Let’s take an example:
If you pay ₹20,000 as rent using your SBI credit card:
- Processing Fee (1%) = ₹200
- GST on ₹200 = ₹36
- Total Extra Charges = ₹236
So your total bill will become ₹20,236 instead of just ₹20,000.
Why Is This Rule Being Added?
State Bank of India SBI Card has not shared a full reason, but experts say that:
- Many people were using rent payments to gain reward points or increase credit limits.
- Processing rent payments involves a cost for the bank, which was not being recovered.
- By adding a fee, SBI wants to control misuse and recover costs.
How Will This Affect You?
This change may impact people who regularly use their SBI credit card to pay monthly rent. Here’s how:
- Higher Cost: You will now pay more each month if you continue using a credit card for rent.
- Fewer Benefits: Earlier, rent payments helped earn rewards or cashback, but now the fee may cancel out those benefits.
- Better to Use UPI or Net Banking: These methods are still free for rent payments, so many people may shift to those.
Important Points to Remember
- The rule is only for rent payments made through the credit card.
- You can still use your SBI credit card normally for shopping, food, travel, etc., without this extra fee.
- Auto-pay rent setups using credit cards will also be charged from 17 August.
- This rule is for all SBI credit card holders, no matter which card you have.
How to Avoid the Charges?
If you don’t want to pay the extra charges, here are some options:
- Use UPI apps like Google Pay, PhonePe, Paytm, etc.
- Use bank transfers or net banking.
- Ask your landlord if they accept cheques or cash instead.
- Check if you really need to pay rent through a credit card or not.
Benefits of Not Using Credit Card for Rent
What Should You Do Now?
If you are an SBI card user and you use it for rent payments, take these steps before 17 August:
- Check your credit card statement to see how much rent you usually pay.
- Calculate the extra fee you will have to pay.
- Decide if you want to continue using the credit card or change your method.
- Inform your landlord if you plan to change the payment mode.
- Keep an eye on any new updates from SBI Card.
Final Words
This new rule by SBI Card may seem small, but it can affect your monthly budget. Paying rent by credit card was easy and offered rewards, but now it comes with extra cost. So, it’s better to plan in advance. Think smart, compare your options, and make sure you’re not paying more than needed. Always stay informed about such updates to make better financial decisions.
