The Hidden Rupee: Kotak Fortune Gold [Credit] Card — Your Happiness Lasts Just 48 Days

by Vinaya HS on August 6, 2008

in Finance

Thanks for visiting Capital Advisor. I frequently update this blog to cover various topics on personal finance such as investment strategies, financial products that you should buy and ones that you really should stay away from, financial calculators, emerging themes such as early retirement and financial independence, and much more. You can Subscribe through Email and receive new articles directly in your Inbox or you can Subscribe through the RSS Feed and receive new articles in your feed reader.

When you see a financial offer that sounds too good to be true, you should always read the fine print.

For example, a recent issue of Outlook Money carried an ad from Kotak Mahindra Bank that touts a 48-day interest free period on cash withdrawals done using the Kotak Fortune Gold [Credit] Card in lieu for a flat-fee of Rs 199. Sounds too good to be true right? I mean…no interest for 48-days and just Rs 199…wow!

But, on the 49th day, when you receive your credit card bill, you discover that

  1. There is a flat-fee of Rs 199 for every Rs 10,000 withdrawn.
  2. There is a service tax @ 12.36% on this flat-fee.

So, you’re being charged approximately Rs 223.60 for every Rs 10,000 that you withdraw! And where exactly were these details provided? In the fine print (printed in microscopic fonts)! How often do you stop to read the fine print?

Such practices are what I hope to expose through The Hidden Rupee series.

On a different note, this credit card is aptly named — just that you are not the one who’s making the fortune. How can you? Especially when this credit card encourages you to use it for

  • Personal emergencies, and
  • Business emergencies.

If that’s what you actually use your credit card for, you seriously need to rethink your finances.




Thanks for reading this article. I'd love to hear your opinion. Please use the comments section below to share your thoughts. I frequently write new articles that also cover several other aspects of personal finance including credit cards, financial goals, health insurance, income tax, life insurance, mutual funds, retirement planning, and much more. You can Subscribe through Email and receive new articles directly in your Inbox or you can Subscribe through the RSS Feed and receive new articles in your feed reader.

{ 1 comment… read it below or add one }

Austin August 10, 2008 at 11:25 PM

Vinaya,

I don’t find anything wrong here. For those using credit cards are pretty much aware that any fees (annual fees, finance charges) charged by the credit card company “does” attract Service Tax.

- Austin

Previous post:

Next post: