What Banks Hide From Customers

Imagine after a peaceful and exciting holiday you receive your bank statement with steep charges. You then rush to your bank and start confronting staff members and to your dismay, you come to know that the high end debit card was charged very heavily. Wouldn't this cause damage to your finances? So remember, the world outside is full of deceptive and double cheating people. Unethical practices are always used by company sales person in order to meet the target. Credit card companies, mutual funds and bank institutions always play dirty tricks to lure customers and the practices are rampant.

So here's how you should be careful while dealing with your banks:

High End Debit Card Charges

While opening an account with a bank you opt for a debit card with minimal charges. But later on when you upgrade your card and opt for high end debit card the annual charge rise by a good amount. Though such a card has slew of features but it all comes at a high cost. Typically these charges are in the range of Rs.500-1000 annually as compared to the basic card where charges are less than Rs. 200.

So point to note:

1. While opening a savings account, fill out the application form yourself and read the details, including the fine print, carefully.
2. Inquire about the annual charges on the debit card and cross check it with what's mentioned on the bank's website.
3. Most importantly when you upgrade your debit/credit card, check and confirm the charges with the bank and their website.

The Hidden Fixed Deposit Rate And Period

Attractive rates are always offered on fixed deposit savings but this is for a specific period. For e.g. bank gives best FD rate of 10.00% for 1 year 45 days. However, for periods between 1 year and 46 days and two years, the rate comes down to 8.50%.
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So what to do:

1. Never book an FD without a long and hard look at the interest rate chart. This will fetch you the best possible interest rate for a tenure around your requirement zone. 
2. Before booking a FD, check the rates, across tenures, on the banks website.

Processing Fee for Loan Application

When you apply for a loan through a direct sales agent (DSA), he would encourage you to apply for multiple lenders citing greater probability of getting a loan. But for every cheque you handover to the DSA for loan application, you're charged a processing fee. Paying processing fee to multiple lenders will damage your credit card history since you're reflecting huge appetite for borrowed money.

Things to consider before applying for a loan:

1. Whether you satisfy all the eligibility criteria
2. File an application with only one lender
3. Get into the reason, in case your application is rejected. Get a solution for this and then apply for the loan with same or another lender.

Free Add-on Cards

Credit card companies are the tricksters. In fact, the customer executive will fill out the application form for you and mark the box under the add-on card category. As a result, you receive an add-on card along with your credit card even though you never wanted one. Credit card companies often hide this thing. And if you're not careful with the spends on your add-on cards and the interest charges, you'll end up seeing higher charges on your statements every month. Besides, even if your spend (on primary and add-on cards) exceed your credit limit by a whisker, you'll have to pat over-limit charges, which could vary and even high on add-on card.

Precautions to take:

1. Always fill out credit card application yourself.
2. In case, sales person is filling it out for you, pay attention to each and every option he's selecting. 
3. Always strike out things you don't require. 
4. In case, you opt to choose a add-on card, be aware of it's usage, over-limit charges, interest rate etc. 
5. Fix a reasonable credit limit on your add-on card and insist on receiving alerts through SMS/email for spends made through primary as well as add-on card.

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