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Because the bank has the right to dip into your savings and settle your credit card dues. An extract from HDFC Bank’s Most Important Terms & Conditions for Credit Cards (version 1.23) reads:
Right of Lien
The bank, at any time and without notice, will have lien and right to set-off all monies belonging to the Cardmember and/or add-on Cardmember standing to their credit in any account/custody of the bank, if upon demand by the bank, the balance amount on the card account is not repaid within the prescribed time.
Could be a sticky issue especially when you have any disputed and unresolved credit card transactions. To play it safe, it’s a good idea to avail a credit card from a bank where you don’t keep your other savings.
What do you think? What has been your experience in this matter?
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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.