Shopping, buying petrol with cards is economical
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It is quite common now for anyone, from lower, upper middle classes to the rich to own a vehicle. Unless you fill it with petrol or diesel, you cannot step out and no work can be done. Also, some hundreds to thousands of rupees are earmarked monthly, for fuel. But with a little shrewdness, you can save on this budget. Credit cards create this facility. Cards are available, not just for fuel, but for a number of other purchases as well.

representative imageEveryone is not aware that purchasing petrol through credit card is economical. You can save up to 2.5 per cent. This reminds us of the axiom that saving is as good as earning. Banks are partnering with oil companies and offering co-branded credit cards. With these, the card holder can buy fuel as well as use them for shopping and save much more.Citi Bank, ICICI Bank and American Express Bank are partnering with oil companies and offering co-branded cards. Several other banks too are making the same offer. For Citi Bank and American Express Bank you will have to pay Rs. 2,000 annual fees. For the first year it is free. But for ICICI Bank, there is no annual fee. But you will get a discount of 1.44 per cent on fuel.

American Express Bank is partnering with Hindustan Petroleum Corporation Ltd. (HPCL) and offering a co-branded card. For every Rs. 100 spent on petrol, five points are earned. This is equivalent to Re. 1. It means, one per cent discount. On other purchases, for every Rs. 40, you will earn 75 paise worth of points. Annual fee is Rs. 2,000. If the purchases on the card for that year crosses Rs. 60,000, the annual fee will be cut by half. If your purchases cross Rs. 1.10 lakh for that year, the annual fee is waived off completely.

On co-branded credit cards offered by Citi Bank, partnering with Indian Oil Corporation (IOC), four points are rewarded for every purchase worth Rs. 150, at IOC petrol pumps. Every point is equal to a rupee. It means, you have saved Rs. 4. Technically, it means a discount of 2.67 per cent. You will earn 2 turbo points, for every Rs. 150 worth of purchases at grocery or super markets. For ICICI, HPCL cards, there is a discount of Rs. 1.80 for every Rs. 125. After reaching the prescribed purchase limit, you can redeem the points.

DBS treasures VISA infinite debit
representative imageYou can save up to 7.5 per cent on this card. Normally if you buy petrol through credit cards, you pay a surcharge of Rs. 2.5 per cent. But on DBS card you need not pay this. You can also earn five per cent cash back on this card. However, the limit for earning cash back is Rs. 1,000. That is you will get cash back, on Rs. 20,000 fuel purchase per month.

Standard Chartered Super Value Titanium card
This card offers 5 per cent cash back on fuel, utility articles and Telecom bills payments. However, the cash back is only on purchases of Rs. 750 and above. Only Rs. 100 maximum cash back is earned through a single transaction. In one month, you can earn only Rs. 500 cash back. For other purchases, one point is earned for every Rs. 100 purchase.

RBL Titanium delight
There is no 2.5 per cent fuel surcharge on this card. Cash back of 5 per cent can be earned on purchases in Big Bazar, every Wednesday. For other purchases, two points will be rewarded for every Rs. 100 spent. Similarly, 10 per cent cash back can be earned at Pizza Hut and Dominos Pizza every Wednesday, for orders booked online. Two tickets are offered free on any Wednesday, through 'Book My Show.' If Rs. 1 lakh is spent in one year, processing fee for the next year is scrapped.

representative imageSBI Simply Save
There is no fuel surcharge on purchases worth Rs. 500 to Rs. 3,000 on this card. For every Rs. 100 spent on films, shopping, dining, groceries etc., 10 reward points can be earned. Four reward points are equal to Re. 1. That is 2.5 per cent is saved. For some other purchases, one point is rewarded for every Rs. 100.

HDFC Money Back card
On every Rs. 150 spent for fuel, two points will be rewarded. The same amount spent online will fetch four reward points. In every billing cycle, Rs. 250 will be discounted towards fuel surcharge. An expenditure of Rs. 50,000 and more within one billing cycle (almost one month), fetches 50 per cent additional reward points. Three add-on cards can be availed on this card, without any extra charges. The annual fees for the first year is waived, on expenditure of Rs. 10,000 and above, within the first 90 days of obtaining the card. Even renewal fee for the next year is discounted, for expenditure of Rs. 50,000 and above within one year.

Points to be noted
Annual fees is to be paid on credit cards. This is usually waived, when expenditure is over and above the limit of amount prescribed by the company issuing the card. Also, minimum expenditure limits are set for reward points and surcharge discounts. Depending on the card, this limit is between Rs. 100 to Rs. 800. It is advisable to take cards that are accepted in maximum number of petrol pumps. Some cards offer benefits only for purchases made at specific petrol bunks. If the cards are not used, paying annual fees, etc., will become burdensome. Heavy annual fees is collected over unused cards. For example, in case of IOC Citi Bank platinum card, if not used, an annual fee of Rs. 1,000 to Rs. 30,000 is collected. The cards are convenient for people who purchase fuel, items at super markets, groceries stores or online purchases. For such citizens the cards would come handy.

Earning of reward points
representative imageThe card companies earn interchange fees from the trader, on every transaction that is made through credit or debit cards. This could range between 1 per cent to 2.5 per cent. Added to this, the card holders pay processing fee annually. Also, heavy interests are collected over the amounts that have not been paid within a billing cycle. A part of these revenues are paid to the customers as reward points. This way, the use of cards are encouraged, and more revenue is earned.

There a variety of credit cards. Reward points are less on basic cards, while they are more on premium and super premium cards. Even the annual fees is different for each type of card. The annual fees is more on premium cards. Reward points have to be used before a deadline. Normally it is between one year  to three years. If they are not used before that period, banks can scrape it. The points are just for encouraging more purchases.
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