Starting from August 15th, AU Bank will be updating its charges for fuel and utility spend categories on credit cards. AU Bank will now implement a fair usage policy and charge individuals who make large commercial spends with their personal credit cards. This change aims to discourage the misuse of personal credit cards for commercial purposes. These adjustments do not apply to AU Corporate and Purchase Credit Cards. Even the interest rates charged on AU Bank Credit Cards have been revised. Let’s take a look at the new charges that will be applied to fuel and utility spends after reaching a certain threshold and the revised APR.
Fair Usage Charges on Fuel and Utility Payments
| Category | Condition | Fair Usage Charges |
| Fuel Spends (MCC: 5172, 5541, 5542, 5552, 5983) | Fuel Spends Less Than 50% of Credit Limit or ₹50,000, Whichever is Lower, Within a Calendar Month | No Charges |
| Fuel Spends More Than 50% of Credit Limit or ₹50,000, Whichever is Lower, Within a Calendar Month | 1% Charge on Fuel Spends Exceeding the Condition | |
| Utility Spends (MCC: 4900) | Aggregate Utility Spends Less Than ₹50,000 Within a Calendar Month | No Charges |
| Utility Spends is More Than ₹50,000 Within a Calendar Month | 1% Charge on Utility Spends Exceeding the Condition |
Fair usage charges do not apply to AU Corporate and Purchase Credit Cards. Additionally, fair usage charges do not apply to international transactions. However, GST will be applicable to all charges at rates as notified by the Government of India. Presently, an 18% GST is applicable on all fees.
Revision of Annualized Percentage Rate (APR)
APR of 3.75% per month (45% per annum) will be applicable on all AU Credit Cards except Zenith+, Corporate & Purchase Credit Cards.
Bottom Line
AU Bank shall implement a fair usage policy on fuel and utility spends starting from 15th August 2024. This move shall put forth a new charge of 1% on making fuel or utility payments above ₹50,000 or more than 50% of the credit limit. AU Bank Credit Cardholders shall largely remain unaffected by this as this is a simple move that would only affect those who use their cards for commercial purposes. While many are terming it as a devaluation of AU Bank Credit Cards, in our opinion, this is the right move by the bank, which some others have also implemented.