There might be times when you are unable to pay your credit card bills on time- it may be an urgent need of funds for a medical emergency or loss of employment, your credit card continues to incur compounding interest on the balance amount due.
Recently, many credit card holders were faced with such a situation during the COVID lockdown as all economic activities came to a standstill. To make things easier, many card issuers offer an option to transfer your due amount to another credit card that offers a buffer period during which you have to pay either zero or a less interest. This facility is called Balance Transfer facility.
Table of Contents
When you transfer your outstanding balance from one credit card to another, the new card issuer pays the outstanding amount to the old issuer; and now you owe credit to the new card issuer which you have to repay as per the terms and conditions of the new issuer. You usually get a buffer period to repay your outstanding amount, during which the interest rate is either zero or very less. This outstanding amount is deducted from the credit limit of the new credit card. Effective credit limit of the card = Actual credit limit of the new card – the outstanding amount transferred. Usually, banks allow the transfer of an amount up to 75 – 80% of the credit limit of the new credit card.
Many banks in India including the HDFC bank, SBI, ICICI Bank, Kotak Mahindra Bank, Standard Chartered Bank, RBL Bank, HSBC Bank offer the balance transfer facility to their cardmembers. In most cases, only primary cardholders can avail of the balance transfer facility. Each bank has its own policy with regard to balance transfer. Here, we’ve covered the balance transfer policy and terms of some of the major card issuers in the country.
SBI Cards is the second-largest credit card issuer in India. You can transfer the outstanding amount on another credit card of yours to your SBI credit card. You must transfer a minimum of Rs. 5,000 to your SBI credit card to avail of the balance transfer facility, while the maximum transferable amount is capped at 75% of the credit limit of your SBI card. You can either repay the transferred amount lump sum within the stipulated time period or you can also choose to pay the transferred amount in EMIs-
SBI Cards Balance Transfer: SBI Cards offers two plans for transferring the outstanding amount on another credit card to their cards-
You can apply for SBI Balance Transfer in 4 ways –
SBI Cards Balance Transfer On EMI: SBI Cards also allows you to convert the amount due on your old credit card into EMIs which you can pay off either in 3 months or 6 months-
Some of the SBI credit cards you may consider to transfer the outstanding balance from your another bank’s existing credit card are SBI ELITE Credit Card, BPCL SBI Card Octane, Club Vistara SBI Card, etc.
You can avail the Balance transfer on EMI facility in the following 3 ways-
HDFC Bank, the largest credit card issuer in the country also allows you to transfer the amount due on your existing (another bank’s) credit card to your HDFC credit card and pay the same in easy monthly installments of 9 to 48 months. The transferred amount shall attract an interest rate of 1.1% per month. Apart from the interest, you also have to pay a processing fee of 1% of the transferred amount, subject to a minimum fee of Rs. 250. Some of the best HDFC bank credit cards to which you can transfer the outstanding amount on your existing credit card include HDFC Infinia Credit Card, HDFC Diners Club Black Credit Card, HDFC Regalia Card, HDFC Millenia Credit Card, etc.
You can transfer the outstanding amount on your (another bank’s) credit card’s statement balance to your Standard Chartered credit card, subject to the following conditions-
To apply for balance transfer to a Standard Chartered credit card, you can SMS BT NOW to +91 9223010121 or dial the bank’s helpline at 080-39401166/080-66011166.
Kotak Mahindra Bank is another popular card issuer that allows you to transfer the outstanding balance on another bank’s credit card to your Kotak Mahindra card. Kotak Mahindra Bank also allows you an interest-free buffer period of 90 days on the outstanding amount.
You can apply for balance transfer to your Kotak Mahindra Credit Card in the following four ways-
You can transfer the outstanding amount on your other bank’s credit card to your ICICI bank credit card. To avail of the balance transfer facility on your ICICI bank credit card, there must be a minimum outstanding balance of Rs. 15,000 and the maximum amount transferable is capped at Rs. 3 lakh. ICICI allows you to pay off the outstanding amount in easy monthly installments within 3 to 6 months. ICICI Bank offers some of the best credit cards in the market to which you can transfer the outstanding balance on your other bank’s credit card like ICICI Bank Emeralde Credit Card, ICICI Bank Sapphiro Credit Card, ICICI Bank HPCL Super Saver Credit Card, etc.
To apply for balance transfer to your ICICI Bank credit card SMS <BT> to 5676766.
RBL Bank also offers the Balance Transfer facility to their cardmembers. You can pay off the amount transferred from your another bank’s credit card in easy monthly installments in 3, 6, or 12 months- the bank offers the choice between three repayment plans, summarised as under-
|Tenure (Months)||Processing Fee||Reducing Interest Rate||Effective Interest Rate|
|3||2.99%, subject to minimum Rs. 750||No Interest||N/A|
You can apply for the transfer of the outstanding balance from your another bank’s credit card to your RBL Bank Card in the following ways-
HSBC Bank offers two types of balance transfer facilities to its credit card customers-
Balance Transfer on EMIs- Under this facility, you can transfer the outstanding balance on your another bank’s credit card and repay the same in easy monthly installments.
Perpetual Balance Transfer: This facility by HSBC Bank allows you to transfer the dues on your other bank’s credit card and repay the same at a lower interest rate. No pre-defined tenure for repayment is applicable in case of perpetual balance transfer.
If you’re struggling to pay the outstanding amount (which attracts recurring compound interest) on one of your credit cards, transferring the same to another bank’s credit card where you get a buffer period with a lower or zero interest rate, can be a good strategy to avoid a debt trap. In most cases, the bank also allows you to pay off the outstanding amount in easy monthly installments. However, one must keep in mind, if you fail to pay off the entire transferred amount within the stipulated time period, the regular interest rate shall be applicable. Also, since balance transfer involves a hard inquiry of your credit report, it can also potentially impact your credit profile. However, not being able to pay the due amount on time has a worse impact on your credit profile; therefore it is advisable to transfer the amount due to another credit card which allows a zero or low interest period for repayment of your outstanding amount.
We’ve summarised the key features of the balance transfer facility offered by the aforementioned major card issuers in the table below-
|Card Issuer||Tenure||Interest Rate||
|SBI Cards||60 days or 180 days for balance transfer||
0% on balance transfer with tenure of 60 days,
1.7% p.m. on balance transfer with tenure of 180 days
|Rs. 5,000||75% of the credit limit||
2% of the transferred amount (min Rs. 2,000) for balance transfer with tenure of 60 days,
nil for balance transfer with tenure of 180 days
|90 days or 180 days for balance transfer on EMIs||
0.75% p.m for 3 months on balance transfer on EMIs,
1.27% p.m for 6 months on balance transfer on EMIs
|1.5% of the transferred amount (min Rs. 199) for balance transfer on EMIs (in both the tenures)|
|HDFC Bank||9 to 48 months||1.1% p.m.||N/A||75% of the credit limit||1% of the transferred amount (min Rs. 250)|
|Standard Chartered Bank||6 months||0.99% p.m.||N/A||Rs. 5 lakh (subject to the credit limit of the card)||N/A|
|Kotak Mahindra Bank||90 days||0%||Rs. 2,500||75% of the credit limit||Rs. 349 per Rs. 10,000 transferred|
|ICICI Bank||3 to 6 months||Shared at the time of application||Rs. 15,000||Rs. 3 lakh||Shared at the time of application|
|RBL Bank||3,6, or 12 months||No interest on the 3-month plan, 12.43% and 11.73% on 6 and 12-month plans||Not pre-defined||Not pre-defined||2.99% (min Rs. 750) on 3 month plan, Rs. 499 on 6 and 12-month plans|
|HSBC Bank||3, 6, 9, 12, 18, or 24 months for balance transfer on EMIs||1.17% p.m. on 3 to 12-month plans, 1.33% on 18 and 24-month plans for balance transfer on EMIs||Rs. 5,000||95% of the credit limit of the card||1.5% of the transferred amount (min Rs. 200) for balance transfer on EMIs|
|No predefined tenure for perpetual balance transfer||1% to 1.2% per month for perpetual balance transfer||1% of the transferred amount (min Rs. 149) for perpetual balance transfer|
Balance transfer on EMIs is a facility offered by some of the card issuers including SBI and HDFC, that allows you to pay off the transferred outstanding amount in equated monthly installments.
Yes, the effective credit limit of the credit card to which the balance is transferred decreases by the amount transferred. Effective credit limit of the the card = Actual credit limit of the new card – the outstanding amount transferred.
Yes, since balance transfer involves a hard inquiry on your credit report, it does negatively impact your credit profile. However, you must keep in mind that not paying your card bills on time has a worse effect on your credit score.
Each card issuer has its own terms and policy with regard to the maximum transferable amount. For example, SBI Cards allows a balance transfer of up to 75% of the credit limit of your credit card, while HSBC bank allows utilization of up to 95% of the credit limit of your card.
The perpetual balance transfer facility by HSBC bank allows you to transfer the outstanding balance on another bank’s credit card to your HSBC credit card, which you can repay in monthly installments. It is different from EMIs as there is no predefined tenure for repayment of the transferred amount. However, you are required to make a minimum payment of 5% of the transferred amount each month.