Credit Card Interest Rates - Airtel Finance

The Airtel Axis Bank Credit Card charges 3.6% per month on overdue balances and cash advances. Other issuers offer different rates, ranging from 1.99% to 3.50% per month depending on the card. These rates are applied when the outstanding balance is not cleared by the due date. No hidden charges are applied on transactions.

Credit card interest is calculated using the average daily balance method. The annual percentage rate (APR) is divided by 365 to find the daily rate. This rate is multiplied by the outstanding balance and the number of days in the billing cycle. Since interest compounds daily, the total cost increases if dues are not cleared on time.

No, you do not pay any interest if you clear your total outstanding bill on or before the due date. Interest applies only on unpaid balances and cash advances. Paying on time ensures that no finance charges are applied, and you can use your credit card without worrying about additional borrowing costs.

If you miss paying your bill, penalty interest is added on top of the standard charge. This penalty rate is higher than the regular monthly rate, increasing your total outstanding balance. In addition, banks may also apply late payment fees. Paying bills on time helps avoid penalty interest, extra charges, and higher debt accumulation.

Yes, converting large purchases into EMIs can reduce the burden of paying high charges on the full outstanding amount. Instead of applying the regular interest rate, the purchase is split into smaller monthly installments at a structured EMI rate. This makes repayment manageable, though interest is still charged, but in a predictable and controlled way.

In India, interest rates vary across issuers and card types. Rates range from 1.99% to 3.60% per month. For example, the Airtel Axis Bank Credit Card charges 3.6% monthly, while premium cards like HDFC Infinia and SBI Prime Advantage offer lower monthly rates. These variations depend on the card category, issuer, and features.

APR, or Annual Percentage Rate, is the yearly cost of borrowing money on your credit card. Unlike the monthly rate, APR reflects the annualised interest, including charges and fees. It is calculated by dividing APR by 365 for daily compounding. APR gives a more complete view of borrowing costs compared to monthly rates displayed by issuers.

Credit card interest starts from the day the payment due date is missed or immediately on cash advances. Purchases enjoy an interest-free period if the bill is cleared on time, but overdue amounts are charged interest daily. Cash withdrawals do not get any grace period, and interest begins from the transaction date until repayment is made.

Yes, paying only the minimum due avoids penalties but still attracts full interest on the remaining balance. The unpaid portion continues to accumulate daily compounding charges. This means the debt grows over time, and repayment takes longer. Clearing the total outstanding amount is the only way to stop interest from being applied to your credit card.

The monthly interest rate is the percentage charged per month on unpaid balances, while APR is the annualised cost including fees. For example, a 3.6% monthly charge compounds into a much higher yearly cost. APR gives a clearer picture of total borrowing expense, whereas the monthly rate reflects what is applied on a shorter billing cycle.

No, cash withdrawals do not enjoy any interest-free period. Interest starts immediately from the date of withdrawal until repayment is made. This makes cash advances the costliest type of transaction on a credit card. In addition to interest, banks may also charge a cash advance fee, further increasing the cost of using this facility.

You can avoid paying interest by clearing your full bill before the due date. Other ways include converting high-value purchases into EMIs, avoiding cash withdrawals, and enabling autopay to never miss deadlines. Maintaining a strong repayment record ensures no interest is applied. Discipline in usage and timely payments are key to keeping borrowing costs low.

Late payments attract both penalty charges and regular interest on the outstanding balance. The penalty rate is higher than standard rates, making missed payments costly. For example, if dues are not paid, the monthly charge of 3.6% applies plus penalty interest. Paying on time is the only way to avoid these extra charges and prevent compounding debt.

Yes, balance transfers may carry promotional lower rates initially, but once the offer period ends, regular charges apply. Interest is calculated daily on the transferred balance if it is not cleared in full. While balance transfers can provide temporary relief, they are not interest-free. Careful repayment within the promotional window is necessary to avoid extra costs.

If bills remain unpaid for several months, compounding interest and penalty charges significantly increase the total outstanding balance. The issuer may also report defaults to credit bureaus, damaging your credit score. Continuous non-payment can lead to legal recovery actions. Clearing bills regularly prevents such consequences and keeps credit usage within manageable financial limits.

Yes, your credit score directly impacts the rate offered by issuers. A higher score between 700–900 allows you to negotiate lower rates, while a poor score attracts higher charges. Lenders assess repayment history, credit utilisation, and overall financial behaviour before deciding the rate. Strong credit habits help you qualify for better terms on new credit cards.

Yes, you can negotiate a lower interest rate by maintaining a good repayment record and a high credit score. Issuers consider timely payments, low credit utilisation, and stable history before approving requests. With a score above 700 and no recent defaults, banks may reduce your rates. Strong financial discipline increases your chances of securing better terms.