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Nandipati goutham (Software)     20 June 2016

Credit card settlements


I had a credit card with Standard chartered bank with a credit limit of 30k when my outstanding was 20K, one fine day they suddenly reduced my credit limit to 17k and charged on excess on credit limit. Due to this I stopped paying oustanding amount after a long argument with bank saying before chrging for excess amount due to sudden change in credit limit i need to be given enough time. To my knowledge after 90 days of non pament accoutn has to be declared as NPA and stop charging interest, but they charged interest until it reach 1.90Lacs. Whether bank can charge interest until those many day nearly around 5yrs, any info would be appreciated

Thanks, Shiva


 6 Replies


NPA does not mean that the debtor has been exempted from interest becoming due on the outstanding principal amount from time to time. NPA accounts are added in the non-active accounts for the time being till that is not revived again as an active account.


Nandipati goutham (Software)     20 June 2016

Thank you Sir for your reply, will it may take 7yrs to revive as an active account.

Intrest is being charged until 7yrs and account and finally it shown as closed on cibil with writtenoff status.

Kumar Doab (FIN)     20 June 2016

THe query is also posted at:

Pls post in one thread only.

matt   21 June 2016

Oops! 17k to 1.9 Lacs .its really a very very high interest. I think you should go to court to settle this matter.

Kumar Doab (FIN)     21 June 2016

'Written Off'  status is of no help to you.



Dear Matt,


Your surprise is valid. But the fact is that credit card for defaulters becomes a great curse. First of all the monthly interest rate is too high that ranges from 3% to 3.5% (36% to 42% P.A.) + service tax on each transaction. On default that amount is added to the previous balance due and the interest applies to that consolidate amount. Besides, a penalty of about 5% with minimum amout of not less than Rs.300 is levied on each default. Even if the due amount is paid partly, the balance becomes part of the consolidated amount on which high rate of interest is charged. This process continues till the settlement is made with the credit card company.


So, the credit card becomes monetary facilitator only for those who have the capability to clear the bills on due date of payment every month, not for those, who defaults or make only the minimum amount fixed by the credit card company.




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