New Credit Card Rules In 2025: Hidden Charges To Watch Out For
Hidden credit card charges are often concealed in fine print, although they are not necessarily fraudulent.
The Reserve Bank of India (RBI) has released new rules to improve consumer protection, increase transparency, and curb reckless lending. Apart from the regulatory changes, many banks have also implemented changes to credit card features and fees.
These news credit card rules have a direct impact on cardholders' spending, savings and money management.
Beginning from June 1, 2025, a few banks have enacted new credit card rules, which include modifications to reward point programmes, updated charges and other features. It is important to keep an eye on hidden charges like late payment penalties, cash advance fees, foreign transaction fees and over-limit fees. These are lesser-known costs that subtly but steadily raise your overall debt burden.
Credit Card Fees To Watch Out For
No Rewards On Rent Or Fuel Transactions
Many credit card issuers have imposed a cap on spending to earn reward points. A 1% transaction charge will be applied to specific expenses, such as rent and school fees, regardless of the amount spent. The transaction charge will also be applicable to utility bills, wallets, online gaming and petrol costs after certain thresholds.
Kotak Privy League Signature cardholders, for example, will not receive any rewards for fuel or rent transactions and their utility incentives would be limited to Rs 75,000 every billing cycle.
Kotak Mahindra Bank has also increased interest rates on most of its credit cards. The interest rates have now increased from 3.5% to 3.75% every month (from 42% to 45% per year), effective from June 1.
No Membership Rewards Points On Gold Charge Card
With effect from June 12, 2025, American Express will no longer be giving Membership Rewards points for fuel purchases made with the Gold Charge Card. Earlier, customers used to get one membership for every 50 rupees spent on fuel, including CNG, gasoline, and diesel. The new changes include no membership reward points for petrol, CNG and diesel purchases.
Cashback Accrual And Redemption Process Changes
With effect from June 1, 2025, several banks have implemented changes in cashback redemption. For example, Yes Bank KIWI credit card holders will only be given cashback for transactions that total more than Rs 100. For redemption, a minimum of 500 KIWI points, or Rs 125, are needed. Redemptions are only allowed in multiples of 500 rupees. Earlier, the redemption process was flexible and the fee was 2% for members and 1.5% for non-members on all transactions.
Credit Card Reward Points Changes
Beginning on June 20, 2025, Axis Bank will begin making gradual adjustments to its REWARDS Credit Card. Tolls, government payments, utilities, telecom, rent, petrol, wallet top-ups, insurance, and education will no longer be eligible for reward points. Moreover, cash withdrawals, insurance, rent and wallets will not be included in milestone benefits. Apart from these, rent payments and wallet top-ups will not be eligible for the yearly fee waiver.
Apart from the aforementioned changes, certain cards contain an annual service charge along with the membership cost. Most credit card companies usually charge a fee of 1% to 3% for foreign transactions. Moreover, transferring debt from one credit card to another might result in fees of 3 to 5 percent of the total amount.
June 2025 will see the implementation of credit card devaluations for several banks, including American Express Amex Gold Charge Card, Kotak Bank and Yes Bank KIWI Credit Card.
Cardholders can check the new credit card modifications via the mobile app or website of the bank or the credit card issuer.
