- This topic has 17 replies, 11 voices, and was last updated 1 year, 5 months ago by
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USo one of my friend was using credit card and he got one of the bill of 8k rupees in July 2017.. he paid the bill in full .. but in Aug 2017 cycle he got another 100 rs as credit card bill. He ignored this and no call from bank came at all 6 months fast forward bank starts calling and asking for 5k is amount as bill with lots of charges and late fees added every month
Fast forward to one year – the bill was at 7500/- on Aug 2018
Now he has defaulted on that and he is not receiving calls from recovery agents and all.
He often get emails and the email is from lawyer it says – once twice a year with inflated amounts – latest being upward of 25k as credit card bill as of Jan 2025.
Is this valid scenario? Can bank take action?if u see none of this bill is capital and everything is interest..
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UMost probably 100 rs was his yearly card fee. If he defaulted that, they would have charged a fixed amount for not paying the minimum due default fee + interest on 100. Every month they will add a fix minimum due default fee + base 100 +last month’s fee + the interest, which will baloon up.
Happened to me too, with ICICI credit card of my wife. We cleared all dues. But suddenly after 6 months, I randomly checked and found the bill is 2k. So, it was 500 yearly card fee that was charged after 3 months, so for next 3 months, they were adding 400 each month for not paying the bill and charging interest on everything.
I quickly repaid everything and closed that card, as my wife was not checking the statement emails or logging to her icici account. Now, I just let her use the add on cards, so that I control the credit card billings.
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SStandard Chartered damn notorious for this. Used the card for 3L last month. Claimed Cashback as 3K and Paid 2.97L as remaining bill before the due date. Next month they added 29k as Payment Interest charges by giving the reason that I did a partial payment and 3K is supposed to be counted next billing cycle even though outstanding amount was showing 0. Called and threatened to close the card. a couple of calls later, it was reversed.
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CSo from what I understand, this friend of yours have defaulted on credit card payment for almost 7 years?
Of course, the outstanding will increase as it has.
This friend of yours is not very smart. Why not get it over with when they started calling for 5k so many years and let it drag on?
From 100 rupees to 25k….
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MAlways read “terms and conditions” of your credit card agreement when you get one and/or every month’s bills. You know the text that’s written in fine print. There’s no point in seeking legal advice here without knowing the terms of your credit card and getting clarification from the bank on what that initial Rs 100 amount was for, and what are the subsequent penalties, charges and interest levied.
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CHmm. I don’t think anyone who has replied to this post is a lawyer.
Anyway, the only thing that is messed up in this would be your friend’s CIBIL score.
As you said, your friend paid all dues sometime August 2017 and that only 100 odd rupees was left to be paid. If this is the only amount that is to be paid, then the credit card company would have three years from September 2017 to initiate any legal action for recovery of the money. Even if one excludes Covid 19 period, still they should have filed something in the beginning of 2023. So legally they can’t recover the principal of 100 Rs as the debt is time barred.
But, if there are yearly charges which are getting added every year, the the Credit card company gets a fresh right every year for the annual charges and the time to file any proceedings is 3 years from the date when you have to pay for those yearly charges.
So, ask your friend to download all statements from July 2017 till date and see what you are being charged for.
Getting CIBIL corrected is another headache.
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UQuestion here is can bank initiate an action like a law suite or police case? Cibil score is anyway gone – so he is not worried about it.
Also he had tried to settle it when this was 8k+ reported in Jan 2022 ish , however when he contacted the settlement email guy( must be recovery agency)- they mentioned that he will have to pay 19k ( including some legal fees) … So they are trying to extract as much as they can..
Are you a lawyer Sir?
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CI am a lawyer.
This is a civil dispute. They can try to make it criminal but the police will most likely not entertain such a complaint. The amount involved is also meager.
Yes, they are trying to extract as much money as possible. Don’t give into their demands. Legally they have a very weak case. If they settle for like 5k, that should be fine. It will put a closure to this issue.
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