Indian Credit Card companies which operate like the underworld, have started cutting credit limits of customers who fall in the line of sub-prime borrowers. The tight liquidity in the financial market has triggered this measure.
Taking advantage of this situation, they have also raised the interest rates on credit cards. SBI has raised the rates for credit card customers from 3.1% a month to 3.35% a month. HDFC has raised from 2.95% to 3.25%. The rate increase is mostly effected to persons who have missed payments in the past putting them in delinquent category.
However, premium card members with limits above Rs 200,000 are unlikely to see any downward revision in their limits as banks like to pamper them.
Do not ever get into the credit trap of these companies. The rates are extremely high and we strongly recommend to AVOID these credit card companies and doing business with them if you are not capable enough to pay off the entire balance at the end of each billing cycle.