SBI and IDFC First Bank’s New Credit Card Rules: What Changes from April 1?

“The latest changes to SBI and IDFC First Bank credit card rules effective April 1, 2023. Learn about revised interest rates, lower fees, enhanced rewards, and new security features. Stay informed and adapt to these updates for smarter credit card usage. Read now for a complete guide!”

In a significant move, SBI and IDFC First Bank have announced changes to their credit card rules, effective from April 1, 2025. Millions of credit card users across India, the State Bank of India (SBI) and IDFC First Bank have announced sweeping changes to their credit card rules. These new regulations, set to take effect from April 1, aim to enhance transparency, improve customer experience, and align with the Reserve Bank of India’s (RBI) guidelines on credit card operations. For credit cardholders, these changes could mean adjustments to interest rates, fees, reward programs, and more. In this blog post, we’ll break down everything you need to know about the new credit card rules, their implications, and how you can adapt to these changes.

Why Are These Changes Being Introduced?

The RBI has been actively working to streamline credit card operations in India, ensuring that banks adopt fair practices and provide greater clarity to customers. SBI and IDFC First Bank’s decision to revise their credit card rules is a direct response to these regulatory requirements. The changes are also aimed at addressing customer grievances related to hidden charges, complex reward structures, and unclear terms and conditions.

According to recent data, India has over 75 million credit card users, with the number growing at a CAGR of 25% over the last five years. With such rapid growth, it’s crucial for banks to adopt customer-centric policies that foster trust and loyalty. The new rules are expected to set a benchmark for other banks in the industry.

Key Changes in SBI and IDFC First Bank Credit Card Rules

Starting April 1, 2025, SBI and IDFC First Bank will implement several changes to their credit card policies. These changes are primarily driven by the recent merger of Vistara with Air India, which has necessitated revisions to co-branded credit card benefits. Here are the key changes:

1. Revised Interest Rates

• Both banks have revised their interest rates on unpaid credit card balances. While SBI has reduced its interest rate by 0.5%, IDFC First Bank has introduced a slab-based interest rate system, where the rate decreases as the outstanding balance reduces.
• This change is expected to benefit customers who carry forward balances, as it will lower the cost of borrowing.

2. Changes in Late Payment Fees

• Late payment fees have been restructured to be more customer-friendly. SBI has capped the late payment fee at ₹500, while IDFC First Bank has introduced a graded fee structure, where the fee increases with the number of days the payment is delayed.
• This move is expected to reduce the financial burden on customers who occasionally miss their payment deadlines.

3. Revised Reward Points System

• Both banks have overhauled their reward points systems to make them more transparent and valuable. SBI has increased the reward points earned on categories like dining, travel, and groceries, while IDFC First Bank has introduced a fixed reward points system, where customers earn a set number of points per ₹100 spent.
• These changes are aimed at making reward programs more attractive and easier to understand.

4. Introduction of Dynamic Currency Conversion (DCC)

• For international transactions, both banks have introduced Dynamic Currency Conversion (DCC), allowing customers to pay in their home currency instead of the local currency. While this offers convenience, customers should be aware of the additional charges associated with DCC.

5. Enhanced Security Features

• To combat rising cyber fraud, SBI and IDFC First Bank have introduced enhanced security features, including real-time transaction alerts, two-factor authentication, and the option to temporarily block/unblock cards via mobile apps.
• These features are expected to provide customers with greater control over their credit card usage.

6. Revised Cash Withdrawal Limits

• Both banks have revised their cash withdrawal limits. SBI has increased the daily cash withdrawal limit to ₹50,000, while IDFC First Bank has introduced a monthly cash withdrawal limit of ₹1,00,000.
• This change is expected to provide customers with greater flexibility in accessing cash.

7. Changes in Annual Fees

• SBI has waived the annual fee for the first year on select credit cards, while IDFC First Bank has introduced a lifetime free credit card option for customers who meet specific spending criteria.
• These changes are aimed at attracting new customers and retaining existing ones.

Impact on Cardholders

These changes will have a significant impact on cardholders, particularly those who have relied on the benefits associated with co-branded Vistara credit cards. Here are some of the key implications:

• Loss of Travel Benefits: The discontinuation of milestone rewards and complimentary travel vouchers means that cardholders will need to reassess their credit card usage, especially if they frequently used these benefits for travel.
• Increased Spending Requirements: The new eligibility criteria for lounge access will require cardholders to increase their spending to retain this benefit. This could be a challenge for occasional travelers who may not meet the spending thresholds.
• Higher Annual Fees: The revised annual fees may lead to higher costs for cardholders, although fee waivers are still available for those who meet the spending criteria.

Detailed Breakdown of Changes

SBI Credit Card Changes

SBI has announced several changes to its credit card policies, particularly for its co-branded Vistara cards. Here are the details:

• Discontinuation of Complimentary Vouchers: From April 1, 2025, SBI will no longer offer complimentary economy or premium ticket vouchers on renewal of its Club Vistara SBI Credit Card.
• Elimination of Milestone Benefits: The milestone benefits tied to annual spending limits of Rs 1.25 lakh, Rs 2.5 lakh, and Rs 5 lakh will be eliminated. This means that cardholders will no longer receive premium economy ticket vouchers upon reaching these spending thresholds.
• Revised Annual Fees: The annual fee for the base Club Vistara SBI Credit Card will be Rs 1,499, while the PRIME variant will have a fee of Rs 2,999. However, cardholders can still avail of a fee waiver upon meeting specific spending criteria.

IDFC First Bank Credit Card Changes

IDFC First Bank has also announced significant changes to its credit card policies. Here are the key updates:

• Discontinuation of Milestone Vouchers: IDFC First Bank will discontinue milestone ticket vouchers for its co-branded Vistara credit cards from March 31, 2025. This means that cardholders will no longer receive vouchers for premium economy tickets upon reaching certain spending thresholds.
• Phasing Out of Co-Branded Cards: The co-branded Vistara credit cards from IDFC First Bank will be phased out by March 31, 2026. Cardholders can continue to earn and redeem Maharaja Points until this date.
• Changes to Renewal Benefits: The renewal benefits for IDFC First Bank’s co-branded Vistara credit cards will also be revised. For instance, the complimentary voucher, which included one premium economy ticket and a class upgrade voucher, will be discontinued.

How to Adapt to These Changes

As a cardholder, it is essential to adapt to these changes to maximize the benefits of your credit card. Here are some tips:

1. Review Your Credit Card Usage: Assess how you currently use your credit card and identify the benefits you rely on the most. This will help you determine whether the revised benefits still align with your needs.
2. Explore Alternative Credit Cards: If the changes significantly impact your benefits, consider exploring alternative credit cards that offer similar perks. For instance, other banks may still offer complimentary travel vouchers or milestone rewards.
3. Meet Spending Criteria: To retain benefits such as lounge access or fee waivers, ensure you meet the new spending criteria. This may require adjusting your spending habits or consolidating your expenses on a single card.
4. Stay Informed: Keep yourself updated with the latest information from your bank regarding credit card policies. This will help you stay ahead of any further changes and make informed decisions.

The changes announced by SBI and IDFC First Bank to their credit card rules are significant and will impact many cardholders. By understanding these changes and adapting your credit card usage accordingly, you can continue to maximize the benefits of your credit card. Stay informed, review your options, and make the necessary adjustments to ensure you get the most out of your credit card and beyond.