Use credit cards elegantly

A characteristic free credit period in India is 45-51 days. If you pay off the dues within this period, the interest is saved. If in case you are unable to pay off the entire amount within the due date, a common practice is rolling over the dues after paying the minimum amount. This could be expensive as you would have to pay an interest of about 3 % per month and the new purchases made will not get any interest-free period until the dues are completely settled. So, here’s a quick look over the other schemes offered by card companies to clear off credit card bills.
Balance transfer
If you opt for Balance Transfer, you can transfer the outstanding balance from one card to another, and thereby extend the repayment period.
Process
A balance transfer can take place between any two banks. The process takes 7-10 working days with a processing fee, and a maximum of 2 % will be levied.
Low interest rates or sometimes zero interest rates are available for balance transfers.
Points to be taken care of
Check for hidden charges or if the bank charges a transfer fee in addition to the processing fee.
The low interest rates the banks offer on balance transfers may be for an introductory period and once this period is over, it may return to the normal rates.
It is important to note that the credit limit of the card on which your new due is, will be reduced proportionately. Also remember that the balance transfer amount will be limited to a maximum 80 % of your credit limit.
EMIs on credit card loans
If you are having a problem in paying the entire credit card bill at one go, a good option is to convert it into EMIs. This facility is similar to a personal loan. But here, unlike personal loan there is no paper work and no waiting for approvals either.
Another advantage here is that you need to pay a lower interest rate of about 1.5 to 2 % whereas the normal credit card rollover interest rate is higher than 3 %. Also, while this scheme is running, one still gets the interest-free period on new purchases.