1. Online skill-based gaming transactions
The cardholder will not get any reward points for transactions done on online skill-based gaming platforms. Some of these platforms include (but not limited to) Dream11, Rummy Culture, Junglee Games, MPL, etc.
If the cardholder spends more than Rs. 10,000 in a month on these platforms, a 1% charge will apply. The charge will be capped at Rs. 4,999 per month. If the Rs. 10,000 monthly threshold is exceeded, the charge will apply to the entire spends for the month in this category.
The online skill-based gaming platforms will be identified through the Merchant Category Code (MCC): 5816.
2. Wallet loading transactions
If the cardholder uses the credit card to load third-party wallets with a cumulative amount of more than Rs. 10,000 in a month, a 1% charge will apply. The charge is applicable for wallet loading on platforms like (but not limited to) Paytm, Mobikwik, Freecharge, Ola Money, etc.
The 1% charge will be capped at Rs. 4,999 per month. If the Rs. 10,000 monthly threshold is exceeded, the charge will apply to the entire spends for the month in this category.
The wallet loading platforms will be identified through the Merchant Category Code (MCC): 6540.
3. Utility transactions
If the amount spent on utility bill payments is more than Rs. 50,000 in a month, a 1% charge will apply. The utility bill payments include prepaid and postpaid mobile bills, electricity, DTH, broadband, etc.
The 1% charge will be capped at Rs. 4,999 per month. If the Rs. 50,000 monthly threshold is exceeded, the charge will apply to the entire spends for the month in this category.
Insurance premium payment transactions will not be considered utility transactions. Hence, the 1% charge will not be applicable to these transactions.
The utility transactions will be identified through the Merchant Category Code (MCC): 4900.
4. Insurance transactions
Earlier, HDFC Bank credit cards had a daily limit on the maximum reward points that can be earned for insurance transactions. However, from 1st July, there will be a monthly limit on the maximum reward points that can be earned for insurance transactions.
For the Infinia and the Infinia Metal credit cards, the current limit of 5,000 reward points per day has been changed to 10,000 reward points per month. For Diners Black, Diners Black Metal, H.O.G Diners Club, and Biz Black Metal credit cards, the current limit of 5,000 reward points per day has been changed to 5,000 reward points per month.
For all other credit cards, the current limit of 2,000 reward points per day has been changed to 2,000 reward points per month.
The insurance transactions will be identified through the Merchant Category Code (MCC): 1411, 1235, 5960, 6300, and 6381.
5. Revision of maximum charge for specified categories
Transactions in the rent, fuel, and education categories already attract a 1% charge. From 1st July, the maximum charge per transaction has been revised to Rs. 4,999 for these categories.
In the rent category, the 1% charge is applicable on all transactions. In the fuel category, the 1% charge is applicable on transactions exceeding Rs. 15,000. If the transaction amount exceeds Rs. 15,000, the charge will be applicable on the entire transaction amount.
In the education category, the 1% charge is applicable only on transactions done through third-party apps. Some of these apps include (but not limited to) Cred, Nobroker, Cheq, etc. If the transaction is done on the school or college website/POS machine, there will be no charges. International education transactions will not be charged.
How will the above changes affect you?
If you are an HDFC Bank credit cardholder with reasonable spends in the categories like wallet loading, utility bill payments, fuel etc., you need not worry. As long as your spends are within the specified limits, the 1% charge will not be applicable to you. If you pay the education fee directly on the institute website or POS machine, the 1% charge will not be applicable to you.
The spend-based thresholds for charging the 1% fee have been brought in to ensure there is fair usage of the credit cards. It will prevent the bad actors from abusing the credit cards. Most people with spends lower than the spend-based thresholds will not be impacted by the new 1% charge effective from 1st July.
Gopal Gidwani is a freelance personal finance content writer with 15+ years of experience. He can be reached at LinkedIn.
