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How to read a credit card's key terms before you apply

The RBI's credit card directions set out which terms an issuer must disclose, and when. This guide lists them and what to look for in each, so you can compare cards on the issuer's own published terms.

Written and maintained by the PaisaKhoj editorial team. No individual author is credited.

Credit card terms sit in several places: the card page, the issuer's fee schedule and the document the issuer is required to give you. This guide follows the Reserve Bank of India's Master Direction on credit cards. It shows which terms to find before you apply and what each one covers. It does not rank cards or say which terms suit anyone.

What the MITC is

Under the RBI's Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022, card issuers give cardholders a set of Most Important Terms and Conditions (MITC). The Directions say what the MITC contains and when each part is shared:

  • During marketing: the fees and charges items.
  • At application: a key fact statement covering the fees and charges, drawal limits and billing items, and any additional information the customer may desire.
  • In the welcome kit: all the MITC items.
  • On billing: the fees and charges, drawal limits and billing items.
  • On an ongoing basis: any change to the terms and conditions.

Fees and charges

The first group of MITC items covers the money side of the card. The Directions list:

  • Joining fees for the primary cardholder and for add-on cardholders.
  • Annual membership fees for the primary and add-on cardholders.
  • The cash advance fee.
  • Service charges levied for transactions.
  • The interest-free (grace) period, illustrated with examples.
  • Finance charges for both revolving credit and cash advances.
  • Overdue interest charges, which are to be given on a monthly and an annualised basis.
  • Charges in case of default.

Issuers state rates per month, per year or both. Check which period a figure uses before you compare two cards: a monthly rate and an annual rate are different numbers.

On the interest-free period, the Directions say the MITC must explain that the interest-free credit period is suspended if any balance of the previous month's bill is outstanding. On late payment, they say late payment charges and other related charges are to be levied only on the outstanding amount after the due date.

Limits

The second group covers the credit limit, the available credit limit and the cash withdrawal limit. A limit is set for each cardholder by the issuer, so a card page can show the range an issuer publishes but not the limit you would be given.

Billing, default, closure and complaints

The remaining MITC items cover:

  • Billing: how often statements are sent and by what mode, the minimum amount payable, the method of payment and how billing disputes are resolved.
  • Default: the procedure and notice period for reporting a cardholder as a defaulter, how a default report is withdrawn after dues are settled, and the recovery procedure.
  • Closure: the procedure for surrender or closure of the card by the cardholder.
  • Loss, theft or misuse: how to report it and the cardholder's liability.
  • Grievances: the redressal and escalation process, the timeline, and the issuer's contact details.

The Directions also say an issuer may change the terms but must give 30 days' notice of the change.

Checks to make before you apply

  1. Find the MITC or key fact statement on the issuer's own page for the card.
  2. Note whether each rate is stated per month or per year.
  3. Read the fee schedule for the joining fee, the annual fee and any waiver condition the issuer states.
  4. Read how the interest-free period works and what suspends it.
  5. Compare the same item across cards on the same basis. PaisaKhoj's card pages show figures as the issuer states them, and say "Not stated" where the issuer's page does not give one.

You can browse the cards PaisaKhoj tracks on the credit cards page. Meeting a card's published eligibility criteria is not an approval: the issuer decides on its own assessment.

Source

Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022, Reserve Bank of India, dated 21 April 2022 and updated as on 7 March 2024. Read for this guide on 15 November 2026; check the RBI page for any later update.