Missing a credit card payment in India can lead to financial penalties, credit score damage, and even legal consequences in extreme cases. The impact varies depending on how late the payment is and your bank’s policies.
1. Immediate Consequences of Missing a Payment
🔹 Late Payment Fee
- Banks charge a late fee (₹500–₹1,000 or more) if you miss the due date.
- Example:
- Person A forgets to pay their ₹10,000 credit card bill. After 3 days, they’re charged ₹500 + GST as a late fee.
- Person B pays on time—no penalty.
🔹 Higher Interest Charges
- If you don’t pay the *full bill, interest is charged *daily (3%–4% monthly) from the transaction date (not just the due date).
- Example:
- Person A owes ₹20,000 but pays only ₹5,000. The remaining ₹15,000 attracts 3.5% monthly interest (≈42% annually).
- Person B clears the full bill—no interest.
🔹 Loss of Interest-Free Period
- Normally, you get up to 50 days interest-free if you pay the full bill.
- Missed payment? The next month’s purchases immediately start accruing interest.
2. Long-Term Consequences (30+ Days Late)
🔹 Negative Impact on CIBIL Score
- Late payments (30+ days) are reported to *CIBIL, dropping your score by *50–100+ points.
- Example:
- Person A misses a payment by 35 days → CIBIL drops from 780 to 680.
- Person B pays on time → CIBIL stays strong.
🔹 Penalty APR & Reduced Credit Limit
- Banks may increase interest rates (up to 48% p.a.) or lower your credit limit.
- Example:
- Person A frequently pays late → Bank raises their APR from 36% to 42%.
- Person B maintains good history → keeps low APR.
🔹 Harassment from Recovery Agents
- After 60–90 days, banks may call repeatedly or send recovery agents.
- Example:
- Person A ignores ₹50,000 dues → gets daily calls from recovery agents.
- Person B negotiates a payment plan → avoids harassment.
🔹 Legal Action (For Severe Defaults)
- If dues exceed ₹1 lakh and remain unpaid for *6+ months, banks can file a *lawsuit under the SARFAESI Act or negotiate a settlement.
- Example:
- Person A ignores ₹2 lakh debt → bank files a case in Debt Recovery Tribunal (DRT).
- Person B settles early → avoids court.
3. What Should You Do If You Miss a Payment?
✅ Pay ASAP (Even a Partial Payment Helps)
- The sooner you pay, the less damage occurs.
✅ Negotiate with the Bank
- Some banks may waive late fees for first-time offenders.
✅ Opt for EMI Restructuring
- If you can’t pay the full amount, convert dues into an EMI plan (higher interest but manageable).
✅ Set Up Autopay (Minimum Due)
- Ensures you never miss a payment, even if you can’t pay the full bill.
